Lyoness USA Responds To Ponzi Accusations
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MLM Helpdesk – Troy Dooly has published an article titled “Lyoness America Violating Pyramid, Ponzi, Business Opportunity & Security Regulations?” Troy visited the Lyoness offices in Miami in August and he says, I don’t think anyone is going to be a huge flight risk.
Lyoness response:
Below please find our responses to the assertions, inaccuracies, and misrepresentations that have been put forth against Lyoness as posted on your website. Please note that we copied and pasted the actual nine (9) numbered claims written in italic font made and posted on your website in their “as is” form without making any corrections.
Lyoness is a global shopping community that operates in 40 plus countries with over 3 million Members. Lyoness offers a free Membership with a Cashback card attached to a loyalty program.
1. Lyoness does allow someone to register for free through referrals to earn a profit center.
This takes approximately $1,500 of purchases. A review of Lyoness’s actual records will demonstratt less than one percent of the qualified distributors started this way. In fact, there may have never been one.
It is true that Lyoness does allow a prospective Member to register for free to enjoy the Lyoness benefits and earn units. Profit centers do not exist in Lyoness, and therefore, cannot be created. The author’s claim regarding “reviews of Lyoness’s actual records will demonstratt less than one percent of the qualified distributors started this way.
In fact, there may have never been one,” is simply false. This is a deliberate misrepresentation of the Lyoness program. Commencing for the period of January 1, 2013 through July 31, 2013, ninety three percent (93%) of the Members who enrolled started without making any kind of payment or purchase at the time of enrollment.
While Membership is free, sales must occur for a Member to acquire and accumulate units. “Units” can best be understood as the universal currency of Lyoness. A “Loyalty Benefit” is a non-income producing benefit. Loyalty Benefits cannot be considered income, because they cannot be used as cash or as shopping credits. Lyoness does not pay out Loyalty Benefits to Members. Rather, the Loyalty Benefits are used to generate Accounting Units in the Accounting Program. Lyoness Members can acquire Accounting Units by using Loyalty Benefits they have earned by shopping in the Lyoness shopping community. A Lyoness Member always earns Loyalty Benefits each time he shops at a Lyoness retailer.
For example, in addition to earning a 1% to 2% cash rebate and the Friendship Bonus on two levels, shopping will also provide a Member with Loyalty Benefits, the percentage amount of which depends on the rebate amount contracted between Lyoness and the respective Lyoness retailer. In case of a 10% rebate, 2% is paid out as cash back; 1% is paid as the Friendship Bonus, and 7% (the Loyalty Benefit) will go towards creation of the next unit. The amount of a Loyalty Benefit changes depending on the total rebate, which can be as little as 1%, or as high as 25%.
It is important to understand that unlike other direct selling companies, Lyoness does not require its Members to purchase and/or inventory products. Instead, Lyoness has negotiated relationships with local, regional, and national retailers that are called Lyoness Loyalty Merchants so that Lyoness Members can receive cash back from normal, everyday purchases. As most people know, “cash back” programs are very popular today. The problem with many programs is that you must join a separate program for each retailer at which you shop. In addition to convenience, Lyoness affords its Members the ability to benefit from the purchases of other Members referred by them.
Lyoness also does not require Members to pay a Membership renewal fee, does not require Members to purchase start-up packages, and does not require Members to commit to an auto-ship. Gift Cards purchased from Lyoness are sold and redeemed at full face value. In addition, we help Members get rebates and other benefits on everyday purchases made within the Lyoness shopping network.
The extraordinary benefits of Lyoness are that it offers every Member the ability to: (1) earn rebates on their own everyday purchases from thousands of merchants; (2) earn money from the everyday purchases of the individuals they refer. And the benefits Lyoness provides Members with the rebates Lyoness negotiates with Loyalty Merchants are significantly larger than those offered by other cash back programs. It is also important to note that the Lyoness program does not motivate individuals to purchase products they do not want or will not use. Lyoness Members purchase goods they normally use from merchants they normally shop at!
A Member may acquire units through one of four shopping methods: (1) using his or her Lyoness Cashback Card at Lyoness Loyalty Merchants; (2) Online Shopping with Loyalty Merchants via the Lyoness website; (3) fully and partially paid Loyalty Merchant Gift Card orders; or (4) shopping with a proprietary and free Lyoness smartphone application that can be downloaded by Members on the iPhone or other smartphone.
The following is an example of how a Member can generate a unit by making purchases at a
Lord and Taylor department store using $1,500.00 worth of Gift Cards purchased through Lyoness. If a Member purchased $1,500.00 worth of merchandise from Lord and Taylor using six (6) $250.00 Gift Cards purchased from Lyoness, the Member will receive 2% Cashback ($30.00) and the remaining rebate of 5% ($75.00) is the Loyalty Benefit deposited in the Member’s Loyalty account. That $75.00 creates a Unit and either starts the Member’s personal Accounting Program for Accounting Category I, or is placed in the Member’s existing Accounting Program for Accounting Category I. As you can see by the above example, one way a Member may earn a unit is by accumulating $75 in a Loyalty Account from shopping rebates received by making fully paid Gift card Orders. Members generate units in this fashion and by shopping for everyday household goods at participating local merchants or even by purchasing large ticket items such as automobiles through the Lyoness Loyalty Network.
We encourage anyone interested in learning more about the Lyoness program to review our website www.lyoness.com and read our Income Disclosure Statement that can be accessed at www.lyoness.us by scrolling to the bottom of that page and clicking on the “GTC” link.