vemma ftc shutdown

Vemma Autoship Shutdown Review By FTC

It's official: the sports nutrition and energy drink company Vemma (Vitamins, Essential Minerals, Mangosteen & Aloe) along with flagship core products verve and bodē has temporarily shut down operations after the Federal Trade Commission allegations were handed down mentioning they were running an illegal pyramid scheme and ordered to cease and desist all business operations until further notice.

All we have to say is wow, what a blow to Vemma distributors, customers, affiliates and members and the entire network marketing MLM industry. Let's try to make sense of and review Vemma getting shut down by the FTC.

Where Did Vemma Company Management Go Wrong – Allegedly?

Vemma, a company who reported earning over $200,000,000 million in both 2013 and 2014, allegedly committed a series of ‘criminal' offenses, according to claims from the FTC report released and delivered on August 26, 2015.

Defendants B. K. Boreyko, and Tom Alkazin were charged with the following MLM offenses as well as Vemma's entire company assets being seized and froze for the time being:

— Promising Recruits They Could Make Up To $50,000 Per Week
— Offering Little Help In Selling Its Products
— Requiring Autoship
— Rewarding Recruitment And Ignoring Product Sales
— Failing To Warn Recruits That Most Vemma Affiliates Will Not Earn Much Income
— Providing Deceptive Marketing Materials To Affiliates
— Having A Compensation Plant That's Confusing, With Many Convoluted Rules And Requirements, With Bonuses That Have Tight Limitations And Restrictions

Vemma has been pitched largely to college students, most of whom believed the wildly exaggerated income potential but wound up losing lots of money.

How they lost money is precisely part of the problem, according to the FTC.  To sell Vemma, one must make an initial investment of $600.  In addition to that, one must commit to $150 per month in Vemma product purchases. In the industry, that's called “Autoship”, and it's where the prime FTC charge originates.

Vemma's Young People Revolution #YPR

Vemma's marketing philosophy, according to the FTC report, has been to target young professionals or young people.  That's why you'd find affiliates visiting college campuses and encouraging students to consider becoming a Vemma affiliate rather than opting for a traditional job.

Promotional materials show young affluent-looking young adults set against a backdrop of jets, fancy cars, and yachts.  (You can't buy a yacht for less than a million dollars!).  The FTC report claims these materials give the message that substantial wealth is possible with just a minimal amount of work and experience.  The report quotes the following snippets from Vemma promotional materials:

“What's possible with a Vemma business?  Unlimited possibilities!  Achieve goals like financial freedom.  If you can dream it, you can achieve it!  So if our dream is to get out of debt, exchange the traditional 9 to 5 for our own schedule, Vemma's business opportunity can help you achieve it.

My nme is B.K. Boreyko and a big part of my job here at Vemma is to help people create a full-time income with part-time effort.”

-Vemma promotional materials

The report cites numerous instances of how Vemma gives advice on how to recruit, but virtually no resources on how to sell the product.  In fact, it's cited that Vemma actually tells affiliates to give away the product as samples in order to recruit more people.

Here's a different perspective

In the world of multi-level marketing, a lot of things have changed in the past few years.  For one, more companies are upping their game and offering legitimate products backed by a fair and rewarding compensation plan.  There is now a self-governing association: the Direct Sellers Association, which serves as a measuring stick of sound MLM business practices.  They recognize direct selling companies who adhere to their strict quality guidelines and are making great strides helping MLM gain acceptance by a wider marketplace as legitimate.

Vemma is a member of the Direct Selling Association.

Some would argue that many of these companies make much of their income off their Autoship programs.  They have solid product lines and fair compensation plans and they do not resort to shady recruitment practices to grow their affiliate networks.

The Vemma case is seen by some to be a precursor to the FTC banning all Autoship programs, no matter the circumstances.

What happens next

For the time being, although the Vemma website is still up and running, their “join now” page has this message:

“Product orders and access to your Back Office are temporarily unavailable at this time. We appreciate your patience.”

Not good.  But when the FTC freezes your assets, what choice do you have?  The FTC wants Vemma shut down and also want restitution for injured parties, and return of funds, as well as a permanent injunction against defendants for any future violations.  We'll all be keeping an eye on this case, as it affects everyone in the MLM industry.

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4 COMMENTS

  1. You have got to be kidding me? Their characterization of Vemma describes almost every MLM out there! They didn’t just shutdown Vemma’s autoship, they obtained a court injunction which (among other things) froze the assets of the company, the owner, and the distributor at the top of the pyramid. The FTC is starting to get very serious about MLM and its “peculiar” business model. Burnlounge, now Vemma…….. next stop Herbalife?

  2. This is bad journalism. I can tell you firsthand that numerous statements are inaccurate. I did Vemma in order to get my product for free and never gave any money other than what I spent on my own product. AutoShip was optional you had to check inbox saying if you wanted it or not. Please get your facts correct before you publish stories it reflects poorly on your skills.

  3. This is the Sugar Daddy of Kayla Kellar aka Kayla Oberg. She graduated from Gilbert High School in 2005. BK Borekyo is an 53 year old man. That makes him at least 23 years older than Kayla, old enough to be her father. Deb & Dan, can you not see this? It’s utmost disgusting.

    This comes direct from the the dirty.com

    THE DIRTY ARMY: Nik, you need to expose Kayla Oberg to all the individuals scammed by Verve. She is home wrecker #1 of Arizona. BK Boreyko who is the founder of Verve left his wife for this trailer trash. Let me break it down; Verve is a multi-level marketing scam, they only sell product to their reps and not to the general public. Idiots who work for Verve are brainwashed to think they are making money, but in reality they have 50 cases of product sitting in their garage collecting dust while Kayla Oberg buys new designer shoes, clothes, etc. BK Boreyko was married to a woman who had 6 of his children in 6 years. BK Boreyko strategically started sponsoring the Phoenix Suns female dancers while he was still married. This is when Kayla Oberg saw the opportunity to make $$$. Her and her friend Kaytie O’Brien started going on trips with BK. During this time Kayla was also married with Stax Bistro restaurant owner, Christopher Bran Oberg in Scottsdale who they have a daughter with. Now get this, BK hired Kayla Oberg to travel with him as his ‘make-up artist’ that was the cover. These were all secret affair trips paid for by Verve. He also bought her a brand new Porsche Pantera a few months back. BK cheated on his wife and becomes Kayla Oberg’s sugar daddy supporting her friend Kaytie O’Brien too, he put her on the Verve payroll (hush money). Well Nik, the wife finds out BK was having an affair and to this day is completely embarrassed. So Kayla Oberg gets my vote for the top home wrecker of Scottsdale. The funniest part; Kayla and Kaytie have their own blog where they brag about all the money they spend. Verve scam money.

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