My, What Strange Bedfellows!

Wow, when I look back to my first post in this blog back in October, who would have ever thought that I would be sending Christmas gifts to Doug Bauknight, a YTBer whom I now consider a friend? We are still on the opposite sides of the fence but we talk If that weren't strange enough, I now find myself corresponding with one of the top Corporate attorneys in the MLM world. What is even more strange is that he was the Chief Counsel for YTB and led the firm from nothing to nearly 150,000 RTAs strong. Stranger still, he was a decades old personal friend of "The Coach".

It appears that when Ted Lindauer began to do what he was hired to do, the megalomaniacal duo of Scott and Coach Tomer fired him without nary a reason. Apparently Ted wanted them to comply with some laws as it related to their expansion into cars, flowers, and other ventures. He wanted to make sure that the hundreds of thousands of lemmings running around the country were selling the program legally. Apparently he wanted to let him know of the legality (or illegality) of charging the RTAs for credentials. But the Tomers were on a roll. Back in September when Ted was fired, the stock was up and it was a great time to sell. And sell they did! Ted was replaced by in a nepotist move when the Tomers replaced him with Andrea Clagg, the wife of CFO, John Clagg. Andrea apparently has no legal background and is all of a sudden the Director of Legal Services.

Now, the good Christian Coach will not speak with Lindauer nor offer any explanation as to why he was ousted. So much for loyalty and friendship. Ted has a website with a lot of very good information on YTB--MLM Lawyer. What I find particularly interesting is that his claims are fairly parallel to my suspicions all along--YTB is operating on the fringe of legality. But with his inside information and his recent letter to the Board of YTB, I suspect that YTB has crossed the line. I wonder how "Coach" is going to spin this bit of news. Ted has now put the Board of YTB on notice of their illegal ways with an eye opening letter. An attorney with nearly a half century of experience does not write such a letter lightly.

Just some key points:

• The required trainings and purchasing of credentials violates civil and criminal provisions of many states' anti-pyramid laws and constitute deceptive trade practices under the FTC.
• The RTAs that sell cars need to be licensed to sell cars in many states.
• The Two Fly Free program constitutes a Travel Club or Discount Buying Service which requires licensing and bonding in many states. YTB has not obtained them.
• The promotion of the medical insurance has effectively resulted in YTB being deemed an unlicensed insurance provider in many states.

Ted also points out some "accounting irregularities", something to which YTB is no stranger:

• As of December 31, 2006, they were overdrawn on the corporate bank accounts is excess of $1 million dollars.
• Their CFO, John Clagg, is not a CPA (but he plays one during the week and his wife plays an attorney)
• The promotional materials used by the RTAs are not being reviewed by knowledgeable legal counsel prior to publication (can you say "Coming to you from the farm...")
• The companies have ceased publishing monthly data on Rep and RTA earnings and RTA travel bookings.

So, what does all this mean? Well, Ted, as a shareholder of record has put the Board on notice that they must comply with his requests or provide a satisfactory response to him. If not, he is prepared to file a stockholders derivative suit in the US District Court to compel YTB to comply. I imagine that word of this action will spread to several other three letter agencies that might have an interest--IRS, SEC, FTC, and the AGs of many states.

NOTE: I have placed a link to Ted's site on this blog. I feel it is important for everyone on both sides of the fence to read this information. Please visit it and read some of the comments from current and former YTBers, responses from YTB HQ, and Ted's comments on the whole situation!

YTB Kick Off 2008

This video had embedding disabled by request, so you will need to CLICK HERE to see it. While the contents offer no surprises, yet again, it reinforces just how important the recruiting aspect is to YTB.

The message is all about exposing the opportunity daily to as many people as possible. The "actor" stresses to not deal with people that "don't get it" or "don't want to get it", but to make sure you find those that "do get it". Pretty reasonable. He also said that "most" don't get it. One wonders why?

One of the points he made was to get "travel testimonials" which apparently is a different definition than I am used to using. As I see it, he is talking about personally traveling on the perks and discounts in order to provide your own testimony in selling the program. He tell you that you should use the CLIA number since they lost the IATA number and encourages people to go out and get some discounts and travel. He mentions a recent trip to Cozumel with his parents that was 100% tax deductible. Hmmm. I like the way the IATAN thing was glanced over.

In the "real" travel industry, a testimonial is from a client and it discusses how the agent served them, their experiences at the property or cruise line, and typically some sort of endorsement.

This appears to be more of a travel on a discount so you can tell people you travel at a discount. And then sell them on the program. Again, no real surprises here but still awfully smarmy!

Will The Real Phil Piccolo Please Stand Up

There have been a lot of comments and speculation about a nefarious scammer, Phil Piccolo, having joined YTB with the intent of being the biggest and the baddest YTB Rep/RTA there ever was.

Just who the hell is Phil Piccolo? Sure, I have read some internet sites that reference him--and he does indeed seem like a one man MLM scam machine! If the rumors are true, I understand that he has already been named a director. So, again,why does YTB want a known scam artist as their Numero Uno Major Domo? I mean they already had some bad press on Angelo Degenhard--just does not make sense to me. My hypothesis is that the more people recruited, the more money for the top of the pyramid! The owners are sure not making any money on selling their stock now that it seems firmly entrenched at a buck--so I guess if Phil can bring in 100K members that is a cool $50 Mil for the top dogs and another $5 Mil a month in rental fees for the websites.

It has been posed that we do not know this is the "same" Phil Piccolo--but that is sort of like saying we have a quarterback that played in the SuperBowl for the Patriots several times named "Tom Brady" who wants to play for us--but we are not sure it is the same "Tom Brady".

So, what is the story on this mysterious Phil Piccolo? Google it here!

Is Carnival Coming Around?

It seems as if Carnival may be coming around. Maybe the new CEO Gerry Cahill is taking a look at this from a financial angle!

It appears that Carnival, effective immediately, is requiring any individual agent to have sold 5 cruise in the prior 12 months before being offered any discounted travel or FAMs. So there goes a huge recruiting tool from the YTB Book of Recruitment.

Per Vicki Freed:

"There are so many different business models out there in the travel distribution system now that it is becoming increasingly important to ensure that only professional travel agents who are actively promoting and selling cruises are receiving travel agent discounts," said Vicki Freed, Carnival's senior vice president of sales and guest services.

...which I think is a bit of backpedaling since when we spoke she stated that Carnival had no means to track an individual's sales. I did not believe it then and apparently for good reason.

So, how does one sell "traveling like an insider" and traveling on hugely "discounted rates" when the #1 supplier of YTB has now clamped down. Here is a novel concept--sell travel and not the website! To a few in YTB this has no impact (as it has no impact on the traditional agents who have supported Carnival for many years), but for the vast majority of people who signed up for the CLIA card, the IATAN card, and the discounted cruises on Carnival---they will need to re-evaluate the value of the $50/month they are paying!

All in all, I see this as the right move by Carnival even though it is a move to save a little face as well. I think RCI has the right idea, and egos will not allow that admission at Carnival so this is the answer!

YouTube Overload

This is apparently a series of 7 videos comprising an hour long presentation. I imagine it is supposed to be similar to the one I attended, but I cannot say as I have not seen them all yet. What is interesting is the presenter. This guy is someone that an RTA was "shocked" that I did not know--being in the travel industry. Well, this is "Mike The Travel Guy". Anyone ever heard of him? Maybe someone with more than the 12 years in the industry that I have?

He professes to have 25 years in the travel business as a travel agent, travel agency owner, and a tour operator. Yet later in the video he claims that he was with AL Williams and had been working in home based businesses off and on for 30 years. The math is just not working for me--but then again, math tends to elude most in the MLM game. One of his comments is a common misnomer--he alludes that because YTB is publicly traded it MUST be a good thing. This cannot be further than the truth. He also says that when he heard "Coach" was involved, he did not need to know any more and signed right up. Take a look. Proud, is this a good presentation?

An Attorney Mystery

This bit of news seemed to slip under the radar back in the fall, but apparently, the attorney that was a major domo in YTB was let go and no one really seems to know why? You can get these originals from Ted Lindauer's website. Hmm, just not sure what to make of this? Any conspiracy theorists out there?

The first letter:

At the request of Coach Tomer, I closed my network marketing legal practice of 37 years in September, 2005. I immediately moved to Southern Illinois and began working full time at Your Travel Biz.com in multiple capacities as marketing compliance legal counsel, a department administrator and as a marketing consultant.

On September 7, 2007 Coach cancelled my contract with YTB without explanation or prior notice. I have reopened my network marketing practice and have had no affiliation whatsoever with any of the YTB companies since September 7, 2007. This Announcement became necessary after Coach repeatedly refused my requests that he publicly announce that I was no longer affiliated with YTB. In my opinion, the withholding of this information from YTB Reps and RTAs was just not right.

Since September 7, 2007 the maintenance of YTB's marketing compliances has been the responsibility of a team of attorneys with law practices in Southern Illinois.

I have filed an arbitration proceeding against YTB to collect back compensation owed to me. As a YTB stockholder I have requested that the Board of Directors of YTB International, Inc. require that the officers of the various YTB companies be ordered to take a number of specific actions. In my opinion each of these actions is critically necessary to ensure the survival and future success of YTB. In the event the Board of Directors refuses my requests I will file a stockholders lawsuit to have the court order that the actions be taken.

Thayer C. Lindauer

The YTB response:

In response to the e-mail recently circulated to some of our Directors from Ted Lindauer, YTB makes this initial statement. Mr. Lindauer was engaged by YTB as legal counsel for several years and has been a friend of Coach's for decades. Mr. Lindauer submitted a written resignation to YTB on August 10, 2007. Although Mr. Lindauer's arrangement with YTB did not provide for compensation in the event of his resignation, Mr. Lindauer made several arbitrary and unreasonable demands on the company.

After months of attempting to work with Mr. Lindauer in good faith to arrive at a generous settlement providing for more than he was entitled to under the terms of his engagement, YTB is shocked to now learn that its own former counsel has attempted to alarm the YTB community with this confusing and unwelcome e-mail communication. We are disappointed that Mr. Lindauer has apparently chosen to cease negotiations and pursue another agenda seeking to harm his former client and its business family.

This situation is being evaluated by our legal team and appropriate action will be taken immediately.

And the Lindauer response again:

Friday, January 4, 2008

I resigned from YTB in April, 2007 because YTB was ignoring my compliance recommendations and refusing to provide staffing to support my administrative responsibilities. Coach asked me to withdraw my resignation and promised to address my compliance recommendations and to provide the needed staffing. I accepted Coach at his word and withdrew my resignation. In the following months my administrative department received additional personnel, including the appointment of CFO John Clagg’s wife, Andrea, a non-attorney, as the Director of Legal Services. My compliance recommendations continued to be ignored.

In early August, 2007 I learned that John Clagg was giving various compliance directives to his wife. Neither John nor his wife were discussing these matters with me before acting on them. I objected noting to Coach that neither John Clagg nor his wife were qualified to make legal compliance decisions and the decisions they had made were wrong ones. Coach refused to stop the Claggs from making compliance decisions and refused to reverse the erroneous compliance decisions they had made. On August 10^th I resigned and submitted my request for severance.

Andy Cauthen, who was then CEO of Your Travel Biz.com, and Coach both asked me to once again withdraw my resignation. Coach promised to address my concerns after the August Convention in St. Louis. He also promised a generous severance package when I retired from YTB. I again withdrew my resignation and returned to work at YTB.

After the Convention Coach informed me that local attorney John Simmons was being engaged as overall General Counsel for YTB International, Inc. and its subsidiaries. I met with John Simmons on several occasions in August to review my compliance and other recommendations previously provided to Coach in several memos. On September 7, 2007, John Simmons asked me to temporarily vacate my office at YTB so it could be modified to house two attorneys. That evening I received an email from John Simmons welcoming me to his new legal team.

Several days later, while working at home, I received an email from Thad Leach, a local attorney who is part of the new legal team. Mr. Leach’s email contained one sentence and stated that YTB had decided that it was no longer in need of my services.

I immediately asked for and was granted an appointment with Coach and Scott. On the day of the appointment I received a call cancelling the appointment and telling me to contact Thad Leach. Mr. Leach and I exchanged various emails about my severance with Mr. Leach denying that YTB owed any severance to me despite the fact my written agreement with YTB called for a specific severance package.

In October YTB offered me a new 3-year consulting agreement in lieu of my pursuing my claim for severance. I agreed in principle subject to having an acceptable written agreement. Mr. Leach sent a proposed draft of a new agreement which was one-sided and allowed YTB to cancel the agreement at any time with no further obligation to me. I rejected this draft and proposed seven changes. Mr. Leach dragged the matter out for several months, finally saying he needed to speak with Coach. I never received a response from YTB as to the seven changes I requested. Mr. Leach notified me just before Christmas that there had been unspecified “new developments” and he would be back in contact with me “after the holidays.”

Continuously throughout the months following September 7, 2007 I offered to train the new legal team in MLM legal compliance requirements in 12 two-hour training seminars without any compensation to me and whether or not I was able to settle my severance claim or enter into a new agreement. Mr. Leach rejected my training proposal at first, then refused to respond as I renewed my offer over and over again.

Most disappointing of all was the refusal of Coach, despite my repeated requests and then demands, to let the YTB Reps and RTAs know that as of September 7, 2007, I was no longer affiliated with YTB and to tell them who is overseeing YTB’s marketing legal compliances. If Coach is comfortable having a team of local attorneys with no Multi Level Marketing experience take on the responsibility of keeping YTB in legal compliance, why hide them and pretend that I was still at YTB?

Ted Lindauer

Blatant Lies

It is not getting any better. Here is a press release I received today. Maybe if one of the YTBers on this blog might be able to let HQ know that no one is listening to them. I have reported this to IATAN as well since I am sure they have a vested interest. This is getting ridiculous!

Suppliers--do you not care that these "agents" have so little respect for the truth?

Here is the press release http://www.webwire.com/ViewPressRel.asp?aId=56090

And here are some quotes from it and the bold statements are my issues!

When you become an RTA you can receive a real, tangible Home-Based Business you can run from anywhere in the world, even from your kitchen table. You get huge discounts on Hotels, Car Rentals, Cruises, Free Upgrades, Exotic Vacations, and many more travel perks. Your own personal travel agent photo ID card and credentials. Support and backing from a State-of-the-Art Travel Agency in Illinois. Your own online travel booking website and 60% of paid commissions. A position in YTB’s Affiliate Marketing Program, allowing you to earn a serious income and bonuses on you and your teams production. “Fam” Trip Access to Exotic Places and your own personal IATAN (International Airlines Travel Agent Network) Card

“We are extremely excited to join over 130,000 other YTB “RTA’s” (Referring Travel Agents) in the travel industry said Dallas von Nieda. Not only can we earn commissions and write off our trips when we travel, but we can also take advantage of insider information, discounts and special opportunities available only to those in the travel industry in the past. We get paid to travel! Everyone travels and everyone knows people that travel so this business sells itself she says. If you ask anyone if they had more time or money what would they do, the number 1 answer is TRAVEL! ”

Again, the gist of this release is NOTHING about selling travel. These folks claim that they are RTAs but the whole pitch is recruitment of the REP! If you are interested in SELLING travel why are you spewing on about how you travel for cheap and get deals? You do not see Macy ads saying "screw the product we sell, come work with us and take the discount"! Do you? NO!! They sell the damned product. This is BS people and it is only getting worse.

I know, I just don't understand. But this is an outright LIE. They do not get an IATAN credential nor are they even able to sell enough to be eligible because IATAN revoked their accreditation!