ST. LOUIS POST-DISPATCH:
Another layer of trouble has landed on Wood River-based travel company YTB International, this one in the form of a class-action lawsuit filed Friday in East St. Louis.
Attorneys representing two agents and sales reps for the company say it is an "illegal pyramid scheme" and "employs an illegal chain referral sales technique" in violation of Illinois law. They are seeking $100 million in damages for the at least 140,000 agents who have joined YTB Travel.
In a filing with the Securities and Exchange Commission, the company said it "intends to vigorously defend the case."
The suit's charges echo those in a suit filed last week by California Attorney General Jerry Brown, who called the company a "gigantic pyramid scheme" in which 140,000 "referring travel agents" pay $450 up front and $50 a month to sell travel but rarely earn any money on commissions. Meanwhile, sales reps — including many of those travel agents — receive commissions and bonuses to sign up more agents.
"These are all different components of the same pyramid scheme," said Christian Montroy, the East St. Louis attorney who filed the suit.
The Illinois attorney general also is investigating YTB Travel, and the local chapter of the Better Business Bureau(BBB) slapped YTB Travel with a negative report last week.
Also on Monday, YTB Travel disclosed in an SEC filing that its application for listing on the American Stock Exchange was withdrawn Friday. The company's stock is currently traded on the Over The Counter bulletin board and it has been trying to get on a more prestigious exchange.
The company didn't say why it withdrew its application to AMEX and didn't respond to questions Monday.
However, the only thing that is different from that morton salt box and YTB Travel is the little girl on the box has an umbrella and YTB Travel doesn't.
For more Information Contact:
Daryl D. Alex
Regional Executive
Traverus Travel and TeleVerus Cell Phones
1.800.781.3254
1.877.744.3431
225.590.7700
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