By: Brian Garvin
Submitted: 2008-09-27 23:49:13 | Word Count: 539
Seven or eight years ago, Skybiz was the happening thing. An MLM (Multi Level Marketing) company, it was among the lucky few that took off relatively quickly. However, shortly after opening, the FTC (Federal Trade Commission) shut down all Skybiz activity. It was deemed a pyramid scheme and an illegal one at that. Therefore, in 2001, Skybiz was forced to shut its doors permanently.
Signs up were halted in 2002, however, for those that had made payment already, they were allowed to keep their end of the bargain for as much as one year. For the most part, MLM companies are legal and a reliable way to do business. The only catch with the law is that all MLM based companies, which are those that pay a commission based on sales and recruitment, must provide their customers with a real service or product.
[ advertisement ]
If any company fails to provide their customers with a solid, real service or product, they can count on the FTC knocking on their doors and a host of other troubles. At the same time, the service or product should be that in which someone regardless of representatives or customers should be able to purchase without having to consider any type of plan, compensation wise. Skybiz got into hot water in this aspect.
The Product
Skybiz was in the business of offering people training and websites. In their original form, no. These websites were typically web packs. They were not generally used outside of the company, therefore, the company offered no real value of any sort to any one.
The company was charging new representatives $125 to join Skybiz. The FTC determined that this was illegal. According to the FTC, Skybiz was deceitful in their advertisements and claims and did not warn their representatives and in general, people who join these types of company actually lose money, more so than they make it. In fact, the FTC charged Skybiz with four different FTC Act violations.
The top earners of Skybiz have been displayed on the World Wide Scam site for years. They are MLM Heavy Hitter Household names so to speak, although admittedly not too many hear from these people lately. For some reason Robert Burtis from the World Wide Scam Network or WWSN really likes to pick on some of these guys. In fact, I checked out WWSN last week while doing the research for this report, and I noticed that some of the top skybiz earners are getting pounded for other newprograms they are promoting at this time.
Now I m not saying I don t respect someone for building such a massive team and downline, I definitely do, but the fact I like to ponder is are the new programs these heavy hitters from skybiz are trying to bring people in going to work? Of course they claim they will, but the truth of the matter is if this was the case, then why are they on WWSN?
Eventually Skybiz and its affiliates caved to the FTC and lost their appeals. They agreed to and were ordered to pay 20 million United States dollars to those who invested money into the company. As of September of 2007, the monies had been paid and all claims were thus closed.
