An online company was accused of running a “gigantic pyramid scheme” in a lawsuit filed last week by California Attorney General Edmund G. Brown Jr.
YourTravelBiz.com offered to help consumers set up their own online travel agencies, then delivered little, according to Brown’s office.
The scheme was “immensely profitable of a few individuals at the top and a complete ripoff for most everyone else,” Brown said in a statement.
The state seeks to “shut down the company’s unlawful operation before more people are exploited by the scam,” he added.
The firm marketed the scheme through its Web site, www.ytb.com, and in meetings and workshops. The site featured videos of people driving Porsches and holding $10,000 checks, according to Brown’s office.
The company had 200,000 members in 2007. The typical victim was bilked for more than $1,000 a year, Brown’s office stated.
Each one paid $449.95 and an ongoing monthly fee of $49.95, but only 38% of them earned any travel commissions, and their median income was $39, the state continued.
These members earned money for each new person they enlisted whether or not they sold any travel.
According to Brown’s office, the company had generated 139,000 “virtually identical” travel sites.
