Philip Reitcheck | greentrees

Empower Network's Compliance Problems

Jul 23rd 2013 at 5:19 PM

It now looks like Empower Network MLM program owners are finally getting concern about their compliance issues after two years of giant check waving.  Now Empower Network has posted a new 1/2 hour compliance video with MLM attorney Kevin Thompson and EN president David Sharpe in their site compliance section.

One of the "humorous" parts of the video is where David Sharpe opens a segment by pretty much stating that anybody who calls a company a pyramid scheme has no idea what they are talking about, with the attorney Kevin Thompson then taking over and reducing David's  “everybody”comment to “90% of people”.  Kevin Thompson goes on to state "The reality, the very simple boiled down version of what makes up a pyramid scheme is, are you paying rewards based on recruitment?  And so, if the pay plan is driven by product sales, that’s an indication of a good program. And in Empower Network, 100% of the commissions are driven by product sales. But, product sales alone does not mean it’s a perfectly clean model.  You have to sell something valuable.  We could have a networking program where we’re selling $10,000 lemonade.  Yes, it’s a product sale and, yes, those sales are funding the commissions but clearly there is a problem." My question is this, isn't selling a "free" blogging program (WordPress)  for a $25 monthly fee basically the same as selling over priced lemonade? 

Now that Empower Network is working on becoming MLM "compliant", no more giant check waving,  telling affiliates that they are "wussy" if they did not purchase marketing products, and the “badass” marketing campaigns.  Plus now it looks like Empower Network is working hard on trying to "shut down" two of its newest marketing teams, Project A.W.O.L. and the, with President David Sharpe stating Yeah we know we made millions of dollars over the past two years doing what you’re trying to do now but that has to stop.”

What exactly did Project A.W.O.L. and Empowerville do wrong?  They have both been promoting the Empower Network program that same way as Empower Network has been doing, over the last 2 years.  As far as I can see, other than stepping on the feet of existing Empower Network teams and A.W.O.L. using the word “investment”, I can’t really see why these two teams have been singled out by Empower Network.

The Project A.W.O.L. web site, started by Empower Network affiliates Kameron George and Glenn Arcaro, have offline as their website as it now states that the site is “under construction”.  But the group appears to be fighting back.  On the bottom of their site page is a small link labeled “compliance update”, that when clicked states "On Friday, the 12th day of July, 2013, EN Compliance posted ‘Empowerville’ had violated terms within their compliance/affiliate agreement.  They did so without due-process, as no prior warning, nor contact was ever initiated.  For your review, we posted our response along with the compliance video (hosted on their website) in the ‘Forums’ section of our website.

Also in response to Behind MLM blog post titled Empower Network battles affiliates over compliance,
Empowerville responded in the comments section with the following:

"Way to shed some light on the bias. That being said, we wanted to chime in on a couple of points. First and foremost, when you enter, we simply collect your email; your friend’s list and and anything else is not collected.  Anyone who has ever set up a Facebook app knows this.  Second, we NEVER spam. In fact, we send out an email less than twice a month (or less).
As for the Forums section, it is still up and running:

That being said, we have also noticed that EN is working hard de-index our website and Facebook page. They may be using illegal trickery to do so, as Empowerville is a rare term. We should automatically be listed first. But EN is working hard to de-rank us.

Nevertheless, we appreciate this post. There is a ton of bias in EN compliance. One only needs to type ‘Empower Network’ into Google to see this. ‘Empowerville’ is a term we have coined. Therefore, we own the rights to it.  Keep in mind that Empower Network cannot trademark the word ‘Empower’ and even if they were to do so in the future, ‘Ville’ is not a word, so they cannot make the argument that Empowerville is a compound word.

There is a ton of bias in there compliance dept.  There are at least 5+ people receiving huge checks at every event who are CLEARLY in noncompliance. Stay tuned, we’ll be listing them ALL on our website very soon."

It looks like the "gloves" are now off and the fight is on.  I cannot blame Empowerville for their been unhappy as it is clear Empower Network just "pulled the rug" out from under them and their team overnight.

Just My Opinion,
Philip Reitcheck

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