Connecticut Better Business Bureau issues alert about possible pyramid scheme

Sept. 23, 2009 - PRLog -- Connecticut Better Business Bureau is warning job seekers about a new opportunity that claims to “multi-level market the Internet.”  An investigation by BBB shows that Texas-based iJango – a new self-described multi-level marketing company – is aggressively seeking representatives for a product that has no track record, indicating that it could be an illegal pyramid scheme.

Multi-level marketing is one form of compensation often employed by direct selling companies, whereby sales agents recruit other sales agents and receive a cut of their product sales. On the other hand, pyramid schemes, which are illegal in 26 countries including the U.S., rely heavily on commissions for the recruitment of other representatives. The money is then filtered up through the pyramid.

BBB believes the potential to generate revenue may primarily depend on the ability of participants to recruit additional representatives.

Connecticut Better Business Bureau President, Paulette Scarpetti, says consumers should understand the distinction between legal multilevel marketing and pyramid schemes.

“We are alerting Connecticut consumers and job seekers about iJango and its business model.  Residents should be cautious of invitations to attend an in-person sales presentation, Web marketing presentation or e-mail offers to make money by recruiting friends.”

iJango claims, for an upfront fee of $50, consumers can join the program, but recommends purchasing a package for $149.95 and a monthly maintenance fee of $19.95. In the company's promotional materials, iJango is described as an interactive Web site "portal" for customers to access social media and interact with online merchants. Would-be recruits are told they can earn commission by inviting friends, family and associates to use iJango’s “portal” Web site for online commerce.

Better Business Bureau in Austin, TX has received more than 4,000 inquiries about iJango since August 1, 2009. Complaints received by BBB voice concerns about problems using the iJango portal, www.ijango.biz, delayed availability and alleged difficulty in canceling membership. The company has responded to some consumers by stating that they have issued, or will issue a refund.

In an August meeting with BBB to clarify the nature of iJango’s business practices, the company’s CEO indicated that potential clients will be paid for the recruitment of registered customers and the recruitment of others to do the same.

iJango’s current rating is an F and its full BBB Reliability Report is available online.

One of the co-founders of iJango, Cameron Sharpe, has traveled the country presenting the iJango concept. Sharpe also co-created Ultimate Introductions, a.k.a. Ultimate Singles, purportedly a Christian dating service that generated complaints from customers by charging thousands of dollars and failing to deliver on promises. Ultimate Introductions was sued by another company in 2004 for theft, fraud and unfair competition. As part of the settlement it was required to go out of business.

BBB recommends consumers exercise extreme caution when evaluating any business opportunity and consider the following advice in order to make an informed decision:

•Avoid any plan that places primary emphasis on commissions for recruiting additional distributors. It may be an illegal pyramid scheme.

•Beware of plans that require purchase of expensive products and marketing materials upfront. These plans may be pyramid schemes in disguise.
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•Beware of plans that claim to sell miracle products or promise enormous earnings.

•Don't pay or sign any contracts in an "opportunity meeting" or any other pressure-filled situation without first taking time to think over the decision. Talk it over with a family member, friend, accountant or lawyer.

•Remember that no matter how good a product may be or how solid a multi-level marketing plan appears, an investment of time, as well as dollars, may be needed for your investment to pay off. If it sounds too good to be true, it probably is.

For more information on pyramid schemes and to check the reliability of any business, visit www.bbb.org.

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Founded in 1928, Connecticut BBB is an unbiased non-profit organization that sets and upholds high standards for fair and honest business behavior. For more advice on finding companies and businesses, start your search with trust at www.bbb.org.