Vemma Top Earners Might Face Clawbacks

FTC, Vemma, Lawsuit


According to an article in the New York Post, Vemma top distributors might face threads of claw backs if the FTC wins the case.

The New York Post:

A former top distributor for Vemma may have to fork over millions of dollars in earnings after regulators accused the energy drink maker of running a pyramid scheme that preyed on college students, legal experts told The Post.

Anthony Powell, a top distributor who left Vemma two months ago, was singled out in a report filed last week detailing the alleged scheme. He was a major player in the multilevel marketing company, which the Federal Trade Commission temporarily halted late last month pending the outcome of a Sept. 15 court hearing.

The report, from the temporary receiver appointed to oversee the company, found that 42 percent of the complaints about Vemma were related to Powell’s lead generation business, Global Pro System, which he used to drum up business.

The FTC also received complaints about GPS.

If Vemma is found to be a fraudulent scheme at next week’s hearing, Powell may have to turn over all his profits from his time at the company, lawyers told The Post.

“I strongly believe the receiver is going to initiate clawbacks against high earners [like Powell] if the FTC’s injunction sticks,” said multilevel marketing lawyer Kevin Thompson, who noted that such clawbacks have been initiated in prior pyramid shutdowns.

Powell is believed to have made as much as $10 million while at Vemma, sources said. To put that into perspective, Vemma founder BK Boreyko made $19 million between 2010 and 2015, according to receiver Robb Evans.

Powell joined Vemma in 2013 from Herbalife, where he was a top distributor for 22 years. He left Herbalife soon after hedge-fund activist Bill Ackman in December 2012 took aim at the diet shake maker, calling it a pyramid scheme. Ackman also detailed some of Powell’s business dealings during his three-hour presentation.

Within weeks of Ackman’s presentation, Powell was out at Herbalife because of what the company called a “difference of philosophy,” according to press reports. Herbalife has vehemently denied being a pyramid.

Since Powell left Vemma, he has been promoting his new MLM called Zyn Travel, according to his Facebook page.

Powell did not return a call for comment.

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