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Friday 20.10.2017 | Name days: Leonīda, Leonīds

Income At Home, Herbalife, and the multi-billion pyramid

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Barron Hansen is a self-employed web developer and researcher in San Diego. Like many people who work from home, he spends a lot of time alone in front of the computer, listening to talk radio. Over time, he began to notice that all of his favorite radio personalities seemed to be endorsing a business opportunity called Income At Home.

Author: PantherMedia/SCANPIX“Start making money on your own terms,” said one ad, read by Glenn Beck. It sounded too good to be true, the kind of thing most listeners probably dismiss without a second thought. And as long as Hansen had been hearing the endorsements, that’s exactly what he did. That is, until last January, when one of his web development clients burned him to the tune of $50,000. Suddenly, Beck’s offer seemed worth considering. The first step in this exciting opportunity was the purchase of an information packet for $9.95, so he went to incomeathome.com and entered his personal information, including home address and credit card number.

A few days later, the Internet Business Starter Pack arrived. Consisting of a single DVD and a 12 page glossy sales brochure that “could’ve been designed by some high school kid,” according to Hansen, what most infuriated him was what the kit lacked: any indication of the actual business behind the business opportunity.

His curiosity pivoted. No longer wondering what sort of opportunity Income At Home might provide, he was now curious about who — or what — might be behind the company itself. Some rudimentary Google research led him to a constellation of nearly identical websites promoting the same info-product he had purchased.

All the websites in this network contained the same small-print notice, stating that the copyright on the material belonged to an obscure firm in Barbados called the Centurion Media Group.

Barbados isn’t a “tax haven” in the most egregious sense: according to The Economist, it doesn’t even make a list that includes such exotic locales as Delaware, Nevada, and Wyoming. But judging from the fact that well over 80 percent of the country’s corporate income is derived from foreign businesses, there must be some advantages to filing your paperwork in the Caribbean. One of those advantages, as The Verge discovered, is that discovering who exactly started the company isn’t just a simple matter of checking out an online database or making a phone call to a Secretary of State — as it would be if the company was located in, say, Nevada.

After repeated requests to speak to a company rep went unanswered — numerous phone calls and email messages, sent to Dahl and the company itself — it’s easy to conclude that Shawn Dahl doesn’t want to appear on The Verge.

For instance, Shawn Dahl features in Income At Home ads, always with the very strong suggestion — although it’s never stated outright — that he is simply someone who made money by taking advantage of this opportunity.

Discovering the source of Dahl’s wealth — and, it follows, the company behind Income At Home — is as easy as performing a Google search for Dahl’s name. Yet Barron Hansen learned that the person trying to sell him on the biz opp (generously designated his “mentor,” but merely an Income At Home participant who had purchased his name and contact info) carefully avoided naming the mysterious, billion-dollar company behind all the success stories. In fact, after receiving his disappointing marketing product, Hansen had taken a follow-up call precisely to pose this question.

“If it is such [an] incredible opportunity,” he asked, “then why is it so difficult to get you to simply tell me who the big company is that I could ultimately be working for?”

The operator responded, lamely: “Is that all you are interested in right now?”

“Pretty much,” Hansen replied. He’d paid the money, read the sales booklet, sat through the DVD, and dealt with a “mentor” who couldn’t even be bothered to make her appointment — finally having another sales rep make the call. And he still didn’t know anything about the company behind Income At Home. He wasn’t asking about Centurion — who sold the biz opps — he wanted to know which multi-billion dollar company they were selling relationships with.

‘If this business opportunity is so great,’ he continued, “what’s there to hide?”

After more prodding, she finally offered a name. To his surprise, it was one he’d heard many times before.

“It’s Herbalife,” she said.

As you probably know, Herbalife is what’s known as a multi-level marketing company (MLM). Instead of dealing directly with franchises, an MLM distributes products through a network of independent distributors. The real nature of his success, however, is embodied by two key MLM terms: upline and downline. Simply put, if you signed up for Herbalife today — and please don’t — you wouldn’t interact with the company at all. You’d interact with the person who recruited you: your “upline.” (And if you started recruiting distributors yourself, they would be your “downline.”) Since you’re restocking through your upline, it’s the person who recruited you in the first place who receives a commission from any sale that you make. Or any sale you fail to make, as long as you keep placing orders.

The first step with Online Business Systems is purchasing something called the Internet Startup Kit. This is the same thing that Income At Home sold Barron Hansen. If you go to either of those websites at the time of this writing, the ordering page clearly states that you can try the kit risk free for 14 days, if you pay $9.95 shipping and handling. After two weeks, if you don’t return the kit, you’re charged the full $39.95 price. According to Hansen and several others, the terms weren’t always that clear: the web is full of complaints made by people who thought they were paying $9.95 for something that cost five times that.

If you’re still with the program, you’ll receive a call from a “mentor,” which is little more than someone who was recently in your position. They bought the kit, liked what they heard, and stuck with it long enough to purchase your name from Online Business Systems. Hopefully, they’re having less luck than their mentor did.

The next step in the process is to sign you up as an Herbalife distributor. Outside of Dahl’s “system,” this will cost you something in the $100 range. But with Online Business Systems, the price is $399.

And what if you want to start your own downline? In order to do that, you need to become a supervisor. This requires other product purchases, where you’ll spend up to $4,000. With this investment, you’ll receive a ton of sales tools and advice from Shawn Dahl’s team, some of which may be helpful. But unfortunately you won’t get any sales leads. And you can’t really sell Herbalife without anyone to sell Herbalife to.

Cheap leads cost about $6. But if you want the good leads, the Barron Hansen-quality leads — that is, people who have responded to Glenn Beck’s radio ads and typed their credit card numbers into a website purporting to provide business information — you’re paying closer to $100 a head. There’s no guarantee that any of those leads will pan out, of course, but the opportunity’s there.

An anonymous forum post from January 2010 lists 28 such companies registered with Herbalife for its Business Methods list. This list includes Centurion Media Group, Income At Home, and Online Business Systems.

Barron Hansen, in the meantime, hasn’t sat idly by while Herbalife experienced this major public shakeup. In fact, he took a page from the Shawn Dahl playbook and started building websites. In January 2012, after his ill-fated conversation with an Income At Home distributor, he started Income At Home Exposed, a website devoted to telling his story and sharing what he saw as a fraudulent business targeting vulnerable people. The website’s content has continued to branch out. He now owns his own constellation of “exposed” websites. In addition to the parent site, there is: Shawn Dahl Exposed, Online Business Systems Exposed, Centurion Media Group Exposed, and a host of others.

“I think they should be in chains,” Hansen said, referring to Dahl, Herbalife, and the groups associated with business methods and the misleading lead generation tactics of Income At Home and Online Business Systems.

“I think they should be prosecuted.”

Ref.110.110.110.3757


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