Another Board Member Feels The Heat

Burt Saunders, one of the latest additions to the YTB Board of Directors is feeling some heat. As he mounts a campaign for US Congress, the question about his affiliation with an alleged pyramid scheme is becoming an issue.

Now I wonder what Burt will decide. What is the better gamble, becoming one of the Coach's Millionaires (at 48 cents a share)? Or partaking of the cushy pension and benefits of a US Congressman?

The story has created quite a flury of news in the Naples Florida area. You can read about it here, here, here, and here.  But Burt is keeping pretty mum on any of his dealings with YTB. Stay tuned!

Naples is no stranger to YTB. Remember, Rick Ricketts lives in  the area and he was investigated by the Attorney General and agreed to "settle" for $400K--do innocent people settle for nearly a half million dollars?. And we cannot forget the YTB Director and convicted gambling kingpin Chris Paraldi.

Breaking News!

Apparently the Bonus Reset program is not working. Apparently the RTAs and Reps are still leaving in droves. In yet another grasp at maintaining their current levels of "agents", YTB is making the following changes:

We find it very fitting that the news we are about to share with you comes during the month of October. As you know, the end of this month is Halloween which consists of "trick or treating". The "trick" part of "trick or treat" is a threat to play a trick on the homeowner or his property if no treat is given.

We are very pleased to inform you that Coach, Scott, and Kim have their own "trick or treats" for everyone (depending on which side of the fence you sit on) for the month of October.

There has been frenzy of activity going on behind the scenes the past few months and we are finally able to provide you with some very helpful and hopeful information concerning what YTB is rolling out as a result.

Reps and RTA's of YTB...we are on the verge of an updated RTA program THIS MONTH with several different levels.

For those who simply want to refer people to their Booking Engines, can still do so and earn 60% commission on all sales from their Travel Web Sites. This basic "affiliate program" (possibly to be renamed later) will be offered as an entry level. Group bookings, and vendor contacts and bookings will NOT be available to these "affiliates". These affiliates are not required to be trained and operate the same way Travelocity, Orbitz and Expedia do, without any personal assistance or contact with clients or vendors.

If you choose to upgrade with YTB for a chance to earn commissions from groups and the ability to work directly with our growing list of suppliers and vendors, RTA's can upgrade by enrolling in an expanded and updated "First Class Training" and by doing so will also increase their travel commission to 70% on all personal bookings.

For those already certified in years past either with the previous CRTA or the updated "First Class Training" will be required retake the updated training for a nominal fee. (Probably $49.95) By upgrading at this time not only will you upgrade your personal bookings to 70% from here on out, but YTB will give you an opportunity to receive 100% commission on two bookings (up to a group of 8 passengers) of your choice!

While details are still in the works at this time, we have also received word that the word "Referring" can also be dropped from your title with YTB and for those who desire, can earn the title of "Travel Agent" with YTB. (More information to follow as either we or the company provides it and details concerning this option are ironed out.)

We want you to reserve this date on your calendars, Saturday, October 18th. James Tackett who many of you know is working full time with YTB is working on the improved "First Class Training" to be launched on this date. While there are several "First Class Trainings" trainings scheduled around the country, we want everyone to have a chance to see first hand what this expanded and updated RTA program will offer you as a member of YTB Travel Network. Therefore the company is setting up a LIVE WEBINAR for the ENTIRE COMPANY on this date. The class will be approximately 4 hours in duration, and our Travel Agent Programs will be explained in detail at that time.

We also wanted to let you know that these new opportunities for you are a result of all the perceived adversity our company has gone through since the National Convention back in August. Through our ongoing discussions with the California AG, new and existing suppliers who offered their input and assistance, the DSA (Direct Selling Association) and our own Directors and Circle of Champions all have provided us with extremely valuable resources and insight into these new programs being rolled out.

What looked like the end of YTB to some back on August 5th when news broke just a day before our National Convention is now making an abrupt about face much to the dismay of our critics.

"Trick or Treat"!

And yes, when you spend that additional $149.95 (for newbies) and $49.95 for the people that were already trained, this will mean you are entitled to 70% commission on all sales and a bonus of 100% commission on two bookings of your choice. So for $449, $50 a month, and $149 for the training, your average annual income will rise from $102 to $109. Quite a return on your $149 investment don't you think? But if everyone took advantage of this, YTB (the company) would do very well.

Besides, it appears they offered the big middle finger to the industry and is now allowing their people to call themselves "travel agents"--they can drop the "referring".

I just wonder how they will sell it to their rapidly dwindling stable of RTAs? It is difficult to sell an upgrade to a product that has been proven not to work. More smoke and mirrors folks. Nothing unexpected!

Update On Federal Suit

According to Travel Weekly, this suit was filed for $100 million dollars.  Wow, that is $125 million in less than 5 days.

Two former referring travel agents for YTB Travel Network launched a class-action lawsuit in U.S. District Court in East St. Louis, Ill., seeking more than $100 million in actual damages for themselves and others who invested in the YTB programs.

They claim they and the members of their class suffered financial losses because YTB International and its divisions operated an illegal pyramid scheme.

The lead plaintiffs are Faye Morrison of St. Louis and Kwame Thompson of Atlanta. One of their attorneys, Christian Montroy, said that because the lawsuit is so new, it is uncertain how many plaintiffs are in the class but “certainly more than 1,000.” He said two more plaintiffs will be added to the suit in the next week.

YTB Executives Being Sued In FEDERAL Court In Illinois

Developing story....but from the Alton Telegraph:

The suit, filed Friday in U.S. District Court for Southern Illinois, names two specific plaintiffs, Faye Morris of St. Louis and Kwame Thompson of Atlanta, Ga., but seeks class action status on behalf of potentially more than 1,000 people who were members of the YTB travel network, either as independent marketing representatives or referring travel agents.

News From The Convention Floor

Fighting for truth, justice, and the YTB way! Our very own Clark Kent Travel-Pro is reporting from the convention floor. The report was extensive, so we are including only excerpts.

I would urge anyone who is not here in St. Louis to get yourself to the Opening of our Convention at the Edward R. Jones Dome, Friday morning at 9:00am Central Standard time. The company has decided to postpone the unveiling of our Lady Liberty and dedicate the first 15 minutes of our opening specifically addressing this issue before we move into the Second Phase of YTB.

How un American. How can Liberty be put on hold? Oh wait, this "Liberty" is a fraud. Must be the theme of the convention.

We can not express how important it will be for you and your YTB business to see first hand what our Founders and our Legal Team have to say. We want to give you ample opportunity to hear first hand just how we will vigorously fight this personal attack" and why we believe we have a very solid shot at prevailing and inning the frivolous lawsuit.

Recruit to the death! Must recruit! What is Coach gonna say that he already has not? If he talks about it to 20,000 people his ego has finally been eclipsed by his stupidity!

Make no mistake, this suit was a personal attack towards YTB and the Traditional Travel Agents are behind what is going on. The timing of this suit was far too orchestrated and calculating for it not to be, as an embargo was put on the release of this suit until 10:00 PM Pacific Time on August 4th. Just 1 day before the opening of our National Convention.

The TTAs are flattered that you feel we orchestrated this. I am pretty sure the attorney general might feel otherwise. And just how is it that YTB has been negotiating this for 18 months and the TTAs have been actively campaigning for only 12? Travel-Pro...make sure you attend a math class at the University!

In addition, California has also filed suites this year with Heinz, Frito-Lay, Kettle Foods, McDonald's, Wendy's, Burger King, KFC, Pepsi, Proctor and Gamble, AOL, and Country Wide Home Loans just to name a few.

Travel-Pro---take spelling as well. Those "suites" they filed. Can you show shere they were intended to topple McDonalds, Burger King, Et Al? Most likely it was for something less than scamming hundreds of thousands of people out of money. I mean McDonalds has screwed up my order on occasion, but to my knowldge they never scammed me. And to boot they don't use styrofoam! And it seems like all of those companies actually pay people to work for them. Not ask people to pay to work for them.

If however you want to be part of the battle with another State just like Florida in 2006 and Rhode Island in 2007, both of which YTB prevailed, I urge you to be in the Dome Friday morning. Our National Convention has more than 20,000 Reps and RTA getting the same play at the same time from Founders and Leaders and we have plenty of room for you.

Wait a minute, for the past year you have said YTB has never been investigated. Please decide which side of your mouth you want to speak from.

Coach, Scott and Kim know how to handle this, they are handling this, and we are not going to hide. We recommend that you stand tall with us on Friday, August 8th at 9:00am when the play is called.

So Coach is calling another play? We saw how well the play turned out when you sold the Carnival certificates in November. The Olympic play was also a good one. Heck, it seems that his play on the two cruises did not work out too well. If the lemmings will not get behind him during good times, what are they gonna do now? And what is he? A coach, pastor or what? Or does it depend on the audience? And what team does he coach? And why does he have only a corner when most coaches have fields or courts? But I am sure he is pleased that you got one more recruiting pitch in!

It should also be noted that if anyone tries to contact you about this suit, please forward any questions and comments to media@ytb.com, and let our Company handle this battle. This is their responsibility, not yours.

Oops, you maybe should tell that to the people at the convention that are talking to the media out front. When you have 438,000 people in a scam one never knows what they will say. And to be honest, the ones that are quoted so far, have not really shed any type of intelligent light on YTB. Note to those that do talk to the media...calling the Attorney General an idiot doe NOT help the case.

See you at the Convention!!
Doug & Ronda BauknightAKA:
TravelProTravel Agents / Network MarketersYTB Travel NetworkPhone:
678.458.5812

OK, one last pitch!

Well there it is, live from St. Louis! All is well and the Coach is going to address the 3,600 Reps and RTAs that are in attendance on Friday. Wait...3,600 you say? Well, yes, 1,600 is the number of people that are Reps and RTAs. The remainder of the reported 22,000 are family and friends. The attendance figures do include friends, neighbors, children, aunts, uncles, and anyone else that wants to attend. You see, even the play called for the convention was a disappointment and they (like the cruise) decided to give it away. After all, it is all about recruiting.

Don't expect too much on Friday other than a round of Kool-Aid and soothing music assuring you that it is all a misunderstanding. Have we heard that before?

--Kate Holmes

PS: Tell Candi May that all of her travel agent friends say hello. And please tell Dr. Bob Seligman we are thinking of him!

Some Thoughts On Yesterday's News

Well, yesterday's news should have come as no surprise to anyone. It was bound to happen and it could have been one of 50 AGs or some Federal authorities. It is quite likely that there will be additional actions being taken with similar claims of deceptive and unfair business practices and of course running an illegal pyramid scheme.

In looking through some forums yesterday, it seems that there are many at YTB that simply have this blind faith in YTB and will take whatever is told to them at face value. Before doing that, please remember how long it took for YTB to disclose the termination by Royal Caribbean and the loss of the IATAN accreditation.  Management was not exactly forthcoming.

Yesterday's news was not a surprise to the Management. They had been trying to prevent this day for 18 months and apparently have failed. As Mark Ewing has pointed out in his YouTube Video and in a comment on this blog, this is not IATAN or a vendor, this is VERY serious ande has some very far reaching implications for YTB, their Management and yes, even the Reps and RTAs that may not have been 100% ethical in their recruiting. The AG is looking for yet unidentified defendants.

If you are a Rep or an RTA in California, I woudl think a call to your attorney (not Pre-Paid Legal) woudl be a good investment. If you are a Director in California, I would definately make an appointment, because it is likely you will be named in this suit and you will be required to defend yourself. Do not count on YTB to do it for you.

As I mentioned, Mark Ewing has a very fair and balanced (sorry Fox) perspective on this:

The YTB Response

YTB has responded to the suit:

On August 4, 2008, a civil action was filed against three subsidiaries of YTB International, Inc. (the "Company") and certain executive officers of the Company in the Superior Court of California, County of Los Angeles, by the California Attorney General. The complaint alleges that the defendants violated California's unfair competition and advertising laws. The Company believes it has operated in full compliance with California law and intends to vigorously defend the case.

The complaint was filed after eighteen (18) months of dialogue, initiated by the Company with the Attorney General to discuss the implementation of a new California law's potential effect on the Company's business model. Throughout these discussions, which broadened over time, the Company has consistently cooperated with the state's information requests and provided detailed evidence in face-to-face meetings explaining how and why the Company's business model is in full compliance with California law. The parties recently came to a standstill and the August 4, 2008 complaint is a result of this standstill. The Company believes it has meritorious defenses to the claims, intends to advocate its position aggressively, and believes it will ultimately prevail in the case.

Scott Tomer, CEO of the Company, stated "we are disappointed that the state has decided to take this action. We firmly believe that the facts in this matter support our position and our legal counsel has advised us that our position is strong. The Company will vigorously defend this matter and we look forward to having the courts decide the merits of our case".

The Actual Suit

If you are interested in reviewing the actual suit which was filed in The Superior Court of the State of California, I have made it available for download.

It is a PDF file and it appears that in addition to the four named individuals they will be pursuing up to 100 other individuals to be named at a later date. I have been told by a local attorney, that the phrase "Does 1-100" typically does not indicate a specific number, but rather that there will be additional people enjoined in the suit.

It appears that at this time, this is only a civil matter.

The $64,000 $25,000,000 Question

This is just developing, but there appears to be huge news tomorrow and if my sources are accurate, this will be bigger than Lady Liberty!