The Direct Selling Association is a joke and here's why
Filed under: Entrepreneurship, Ripoffs and Scams
YTB International, an online multi-level marketer masquerading as a legitimate travel agency, was sued by California's Attorney General back in August 2008, accused of being nothing more than a "gigantic pyramid scheme."YTB settled the charges and agreed to pay a $1 million fine on top of huge changes in its business. In its latest SEC filings, YTB notes that there is "substantial doubt about the company's ability to continue as a going conern."
In September 2007, a year before the California Attorney General sued, YTB's application for membership into the Direct Selling Association was approved. The DSA describes its mission as "To protect, serve and promote the effectiveness of member companies and the independent business people they represent. To ensure that the marketing by member companies of products and/or the direct sales opportunity is conducted with the highest level of business ethics and service to consumers."
So the DSA would appear to have a pretty serious problem on its hands: A member that settled allegations that it was a massive pyramid scheme, surely a problem that doesn't mesh well with a commitment to "business ethics and service to consumers."
So how did DSA respond? Was YTB kicked out of the organization? Nope! Instead, the DSA issued a 497-word statement last month that says almost nothing.
"DSA prides itself in serving as a steward of consumer and distributor protection through its efforts to create and enforce acceptable business standards that often go beyond the requirements of the law," said Neil Offen, president and CEO of the Direct Selling Association, in the statement. "This situation is a clear indication that we must redouble our efforts to make sure our processes are sound and that our members not only understand the requirements of the Code of Ethics but that they are incorporating them into every aspect of their business operations."
But isn't the first step to redoubling your efforts kicking out the company that the California Attorney General said is "immensely profitable to a few individuals on top and a complete rip-off for most everyone else."The message for consumers here is clear: The Direct Selling Association is a lobbying organization that pretends to be some kind of industry watchdog, and multi-level marketing operations of questionable merit use its imputed credibility to recruit new would-be entrepreneurs.
But if a company like YTB can be a member in good standing of the DSA, consumers would do well to be highly skeptical of any sales pitch that invokes this trade group.
Reader Comments (Page 1 of 1)
6-09-2009 @ 8:57AM
Big Daddy said...
I get on the average 3 extended auto warranty offers per month from various 800 numbered companies. Calling them is pointless. Never a name or an address of the company but BBB (Better Business Bureau) member logos affixed. Curious as to how you can check a companies legitimacy with no name I contact my local BBB and gave the 800 number on the card. After several frustrating Emails and even scanning the card and emailing, as instructed because it was illegal for them to use the BBB logo, I got back a Homer Simpson email from the Stupidvisor of the S.Florida BBB. Can you please tell me again your concerns? I rest my case when it concerns any organization touting the benefits of doing business with a member-There Are None!
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6-09-2009 @ 12:22PM
karan said...
try speaking to www.strategyindia.com they will guide you better than the dsa in india.we have tried it and they are any day better.
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6-10-2009 @ 8:50AM
Dave Thornton said...
CrimeBustersNow
Check the CBNow opinion of the DSA and the unholy alliance with governments world-wide particularly here in Canada.
Check the rest of our site, the scams; billions in fraud from Canada spreading to the U.S.; the confrontations, the $10,000,000 liable suit to shut down our website that turned horribly wrong for the bad guys; the false arrest of the president of CBNow and the quick withdrawal of the trumped up charges when the RCMP found themselves caught on CBC National Tv. and more...
http://www.crimebustersnow.org/html/competition_bureau_puppets.html
http://www.crimebustersnow.org/html/ytb__belly_up_.html
http://www.crimebustersnow.com
dave - CBNow
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6-10-2009 @ 10:27AM
Andre Vatke said...
Is the DSA really a watchdog? No. They don't even bill themselves as one. They are an association that's interested in representing their own interests - what would be good for their business as a whole. Some of that is good, some questionable and tainted by self-interest.
However, isn't that what all industry associations do? At least the DSA and companies like YTB (even if they really are evil) didn't destroy a global economy like the banking sector.
I have spend over 20 years helping people treat their network marketing business as a business (@ http://www.leadersclub.com) - weather it's YTP or any other. There are bad apples in the barrel - but the most important factor boils down to knowing all 3 dimensions of marketing and dealing ethically with customers and prospects.
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6-15-2009 @ 12:51PM
Marc said...
Thank you! It's about time somebody said this in print. These MLM companies use their DSA membership as a stamp of legitimacy, and it's very powerful. People take this seriously when they hear it.
How many companies that have been in the DSA have been shut down for being pyramid schemes? Off the top of my head, I know of two of them: Equinox International and Trek Alliance.
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