Loading ...
We have had a couple of angry BurnLoungers complaining about our coverage of the FTC lawsuit against four of the internet music website’s “top moguls.” 
So here’s a chance for those involved with BurnLounge to SHOW their side of the story.
A tipster/commenter pointed us to a BurnLounge message board where critics have been asking members of the website to post a screenshot of their earnings to validate that it meets the criteria for a legitimate music business (to date, their requests have gone unanswered).
According to the FTC, a pyramid scheme is:
A sales scheme, Ponzi scheme, chain marketing scheme, or other marketing plan or program in which participants pay money or valuable consideration to the company in return for which they receive:
1. the right to sell a product or service; and
2. the right to receive in return for recruiting other participants into the program rewards which are unrelated to sale of products or services to ultimate users.For the purposes of this definition, “sale of products or services to ultimate users” does not include sales to other participants or recruits in the multi-level marketing program or to participants’ own accounts. [FTC v. Equinox, April 2000]
That basically means that it is illegal for the majority of a business’ profit to come from people inside the compensation scheme. Usually, the first indicator of this is that a large portion – usually more than 70 percent – of the gross profit is earned from signing-up others rather than from sales of the intended service or product. This is deceptive and usually results in those at the bottom of the pyramid to lose a great deal of money.
So, in the interest of fairness, we’re going to open up this thread for those involved in BurnLounge to refute the pyramid scheme claims and offer evidence that their sales are legitimate; we’ve been told that anyone with an “online store” at BurnLounge can access this information in less than 10 seconds. Have at it!
Good luck – but I think this thread will be very, very quiet.
Besides, we already know exactly what every Burnlounger’s sales figures shows. Don’t we?
Not one out of 60,000 will prove you wrong. Watch and see. The excuses will amuse you.
We’ve been asking for those numbers at our site for over a year now. The only numbers that ever were posted (and some did) showed clearly that the huge majority of income came from selling recruitments – not music.
Intelligent – care to share?
The sad irony of all this is these people are devouring their own. By that I mean they are scamming their friends and family and their friends’ friends and family. Its a vicious cycle perpetuated by pure greed.
+00 cl0se
only time will tell…
BURNLOUNGE, INC. RESPONSE TO COMPLAINT
BY FEDERAL TRADE COMMISSION
In response to inquiries, Sheldon H. Sloan, attorney for BurnLounge, Inc.,
today issued the following statement:
“BurnLounge is pleased with the United States District Court Central
District of California’s decision refusing to grant the Federal Trade
Commission’s request for a Temporary Restraining Order (TRO) and remains
committed to compliance with all applicable laws and regulations. The
Court’s denial of the FTC’s request is a significant victory, and furthers
the Company’s belief that it has conducted its business lawfully. The
Company’s business continues uninterrupted and it will defend itself
vigorously in subsequent Court hearings.
“Through its unique and revolutionary business model, BurnLounge will
continue to afford its customers the opportunity to enjoy sharing their
tastes in music and films, while providing an avenue for them to express
their entrepreneurial talents.”
I noticed all the BurnLounge Bots that commented on the last message are silent now. (I thought their conference calls are always on Mondays.)
Oh well, here a link to the papers that the FTC filed against BurnLounge in case any of the Kool Aid drinkers think this is a joke that will blowover because their talking points tell them so.
http://www.ftc.gov/os/caselist/0623201/index.shtm
Well, this isn’t very surprising, is it?
What’s the quickest way to silence a Burnlounger?
Easy. Ask them to support their claims by showing you their sales figures versus recruiting income.
They immediately fall silent.
If it weren’t so sad, it’d be a funny joke.
Not even one person. Even after all those comments on the other thread.
Still no numbers posted, I see.
Wow, just like on the other board. Doesn’t ANYONE involved in Burnscam want to come in here and prove us all wrong?
I see someone posted the statement from Burnscam that claims “victory” over the FTC about freezing assets — yet if you read the FTC documents they clearly state that all that happened was that Burnlounge asked for time to prepare and was given until the 19th of June.
Get out now folks.
As with many start up MLM programs, a “one trick pony” (offering one “exclusive” product or line) has quite a strain, ditto the “sales force” without a FTC approved prospectus of potential earnings.
Quo vadis Excel, Equinox, Heritage?
I’ll grant several have survived and meet the FTC’s test, Avon, Mary Kay, Amway, Tupperware, Pampered Chef, Discovery Toys for example come to mind. As a legitimate business, I’d note that Berkshire Hathaway’s guru Warren Buffett bought Pampered Chef, in toto. Buffett wouldn’t have done that if it was shady or a poor risk for returns to the ownership.
This could consititue birthing pangs for Burntlounge or the deathknell, that, I suspect, is left to an adminstrative law judge.
Not every “Burnlounger” is on the take. I think it’s cooler to own your own online store than to go to iTunes or Yahoo. Why? Because you do get rewards (either monetary or points to purchase logo items or additonal music. The music costs the same as iTunes (and in a lot of cases, less). I haven’t gotten rich, but I’ve paid for my investment. The FTC has contacted me ( I am within the Columbia Burnlounge umbrella, tho not recruited by Mr. DeBoer) and I told them what I believe to be true, that is, Burnlounge and its unique software can be a positive force. Here’s one way how: It’s a great gift to young people. What kid wouldn’t love the hip factor of owning your own online music store that you could tell your friends about who, in turn, go to the store and buy music from their friend? Of course, they could buy their own store if they wanted to, it’s entirely up to the individual. There are other positive uses for Burnlounge, of which I will name one very valuable one…education. Before you flame me, listen. I brought this suggestion up a year and a half ago but was “pooh poohed” out the door. Burnlounge could offer a set number of online stores (at a reduced price) to school districts to use for DECA club use or various business class curriculum to use. They could assign a store to each student to utilize for a semester (or duration of the class) to learn how marketing and business development works. Depending on what the student puts into it (just like anything else) he/she would get valuable “hands on” experience “owning” a business. Trust me, it’s a lot more fun, cool and hip than selling the “World’s Greatest Chocolate” Bar with a Pizza Hut coupon on the back.
The problem is that the direction of Burnlounge has been hijacked by the MLM pros. As I told the FTC, of all their concerns about BL, I shared about 4 or 5 of them. You can’t go straight to your individual store (which I got around by buying a domain name and linking it to my store…which is apparently prohibited), until recently, Mac users and many Windows users couldn’t access an individual’s sites, and advertising your store by any other means than “word of mouth” is strictly prohibited. Plus, in the past year and a half, the emphasis has been on recruitment rather than music sales. Their excuse for the latter? “We’re building our infrastructure”. It just didn’t make sense. The MLM people have always participated in MLM endeavors, so all they have to do is “activate” their MLM “cells” which, in turn, activate their respective MLM “cells and so on. They have built in networks which are very profitable ones. The individual who isn’t a part of the MLM culture is kind of left out in the cold.
In summation, I’m just saying that Burnlounge can be a positive thing if it is allowed to be.
Ok…flame away.
My
My gripe with
Join James Brown’s Burnlounge team and meet James Brown. I guess that ploy worked while he was alive.
you guys say all the $$ is made recruiting, when if fact these guys are selling a V.I.P. package of products, who says that it is wrong to make more $$ selling a package of dvds, magazines, and a V.I.P. membership to concerts, than selling music????
Apparently the FTC does… thanks for playing.
Still no numbers posted, I see.
[...] The Wizard of Odds: Some Big Names Tied to BurnLounge WHEN THE SEC MEETS THE SEC – With Leather Show us your numbers ? The Palmetto Scoop __________________ Don’t leave it to Al Gore and the hippies: Save the [...]
One of my friends I got into Burnloune last year tried to cash his last Burnlounge Check this week—a total of $26.60. His bank let him know that there were not enough funds to cash the check, so the bank is now charging my friend $10 thanks Burnlounge!!!!!