A new class-action lawsuit alleges that Trump, his kids, and the Trump Organization all helped prop up a multi-level-marketing scheme.
Donald Trump, his children, and the Trump Organization are facing a new class-action lawsuit over their promotion of some shady multi-level-marketing (MLM) businesses. It's well in keeping with the family's obvious desire to make as much money as possible off as many people as possible.
Back in 2005, right as "The Apprentice" was becoming, regrettably, a sensation, the Trump Organization began partnering with ACN, a multi-level-marketing (MLM) company. ACN's business model was pretty much a standard MLM racket: People only made money by recruiting other people downstream, who would then ostensibly sell ACN's product and make payments upstream to the people who recruited them.
ACN sold things like internet plans, but its primary product was a fantastically outdated videophone. As Skype and other video technologies were taking off, ACN was pushing a Frankenstein behemoth that was a desk telephone plus a video screen plus a webcam plus a handset plus a keypad. And if you wanted to call someone, they had to be using an ACN phone too.
Trump didn't just casually endorse this MLM scheme. He did videos for ACN, wrote blog posts for them, and put some ACN folks on "Celebrity Apprentice." The Trump children also pushed ACN, appearing with the founders. Trump told people it was a low-risk investment, which is just not the case for MLM ventures. He bragged that ACN was selling a half-billion dollars worth of video phones annually, which was also not true.
Trump also forgot to tell anyone that, between getting paid for his speeches at ACN conferences and ACN ponying up to be featured on "Celebrity Apprentice," he made millions off of his work with the company.
While Trump made a ton of money off this endeavor, the people who signed up with ACN did not. One of the plaintiffs alleges she spent several thousand dollars to attend ACN events and try to recruit other salespeople. Eventually, she made a grand total of $38. Another plaintiff was homeless and went into debt to be able to participate. He never made any money, and the debt remains today.
The lawsuit is brought on behalf of everyone that was scammed by Trump and ACN. These plaintiffs took a chance on ACN, they say, because they felt like Trump's backing made it a sure thing.
This lawsuit also covers yet another MLM scheme Trump was involved in called the Trump Network. It was basically the same situation as ACN, albeit with health and wellness products. That venture, Trump claimed, was "an exciting opportunity to opt out of the recession."
And then there was the thing about the teens.
ACN and Trump were involved with a nonprofit called SUCCESS Foundation. (Yes, it was in all caps.) The noble purpose of the organization was to provide personal development books for teenagers. When ACN connected Trump with this organization, they said they did so because "no one knows better than Mr. Trump the importance of personal development for our youth and the direct impact it can have on their future."
When Trump signed on, SUCCESS announced his involvement by saying, “Trump has become a household name synonymous with success.” There was also a giant picture of teenagers on a stage with the headline, "The TRUMPS of TOMORROW."
It's unclear why Trump bothered to connect with SUCCESS, save for his relationship with ACN. The lawsuit speculates that ACN used SUCCESS as a sort of feeder group to get recruits for the MLM business.
One of the most pathetic parts of this lawsuit is just how tawdry it all is. These are nothing but unremarkable multi-level-marketing (MLM) scams, although the "Teens of Tomorrow" part is a bit of a twist.
Trump isn't a stranger to tawdry scams. His "charity," the Trump Foundation, was forced to shut down after the New York Attorney General determined the foundation was “little more than a checkbook to serve Mr. Trump’s business and political interests.”
And then there was Trump University, which was the subject of another class action lawsuit — this time from people who had paid to attend real-estate seminars that would supposedly provide them with Trump's secrets to real estate investing, taught by instructors hand-picked by Trump.
Instead, they spent as much as $35,000 to learn definitely-not-secret things such as the fact that you can go to the IRS to learn about tax deductions, and you can use real estate websites like www.trulia.com to find properties. Shortly after the election, Trump settled the Trump University lawsuit, agreeing to pay $25 million to the class.
That a sitting president would face these sorts of lawsuits once seemed unthinkable, but now they're just part of the landscape. That's what happens when you have a grifter-in-chief rather than an actual leader.
Published with permission of The American Independent Foundation.