Cagey Consumer

Is Destiny Telecomm an mlm?

Both North Carolina and California investigated whether Destiny Telecomm was an illegal pyramid, and both had allowed Destiny to continue operating after making limited changes to the way it operated. After moving out of its offices in Oakland, California, Destiny renamed itself Renaissance USA.

Read the temporary injunction issued in Oklahoma.

Here's how one person feels about this company:

A group of people who trusted that this company had integrity found out very quickly this was a word they had no concept of. We never received the calling cards we paid for. Innocent people lost an average of $360 with no way of receivng any compensation. How can anyone who was involved in this scam can go to bed and sleep with a clear conscience?

To now see it renamed Renaissance USA and think anyone who had any dealings with them would not recognise this group name. Most of us were and still are treatment foster parents. We thought we had found a way to work and receive the benefits that were proclaimed. Our dream was to put this money into needed programs and activities for the children. We learned a difficult and expensive lesson.

The Destiny Compensation Plan

The following discussion relates to the operation of Destiny prior to changing its name to Renaissance USA.

Destiny Telecomm's compensation plan is a matrix plan of sorts. Ordinarily In a matrix plan, you receive compensation for sales made by people below you in the matrix. But the only sales that count in Destiny's matrix plan are for recruiting new distributors and for "re-entry" of existing distributors.

Whereas in an ordinary matrix plan, you benefit from ongoing sales once your matrix has been established (and you receive compensation for people you recruit based only on their retail sales), the matrix portion of Destiny's plan pays off only if new distributors enter the plan. When your matrix fills up as required, instead of receiving credit for ongoing sales from your downline, you receive a flat fee for having sold so many money centers to new recruits, and then you get started on another matrix.

Destiny calls each position in the matrix a "money center". The amount of money you make as a distributor depends on the number of people you recruit as well as on the number of money centers you purchase, and the number of money centers the new recruits purchase.

New distributors are encouraged to buy up to 7 money centers. Although buying more than one money center isn't going to result in recruiting more people (or making additional sales), it gets one of your money centers halfway towards the goal of "selling" 12 money centers (because 6 of the 7 of your own purchases are credited to the remaining money center you bought), and it means that each sale you make will be credited towards multiple money centers, because your 7 money centers will be at 3 different levels in the matrix.

Where are the retail sales?

One guideline that state regulators go by is that a multi-level marketing plan should have at least 70% of its volume in retail sales, which usually means that these sales should be made to non-distributors. In the agreement with North Carolina, Destiny agreed to cease recruiting new distributors in the state until this requirement could be met, even though the money center payoffs are unrelated to retail sales.

Destiny does have retail sales, but the money center payoffs are not based on a percentage of the retail sales, they are based on how many money centers are sold. Apparently, North Carolina regulators think that an otherwise illegal activity is legal, provided it's embedded in or associated with a legal activity. Cagey Consumer thinks this is a clear symptom of dementia.

What kind of an activity is Destiny running?

Destiny Telecomm denies that they are operating a multi-level marketing plan, and Cagey Consumer doesn't disagree. It's difficult to pinpoint just what Destiny Telecomm is operating, so Cagey Consumer will let you decide for yourself:

Legal authorities to blame

It is not hard to understand why operations such as Destiny Telecomm persist: there are many people hoping for a fast buck who are willing to risk some money to get it. The legal authorities are sending the message that there aren't going to be any prosecutions of such operations, as long as the operation makes some pretense that their purpose is to market a product or service.

Related links:
Destiny in North Carolina followup story
Settlement with North Carolina (1/23/97)
Destiny's Offices Raided by Police (2/28/97)
Lawsuit targets Destiny (2/28/97)[gone]
Prosecutors Sue Oakland Phone Card Company (SF Chronicle, 3/1/97)
Destiny insists law shouldn't flirt with it (3/1/97)[gone]
Destiny chief denies pyramid accusation (3/2/97)[gone]
Destiny used surreptitious lingo (3/7/97)[gone]
AG on Destiny Telecomm (3/8/97)
Destiny made changes only in 'wording' (3/8/97)[gone]
Destiny's regulatory worries continue (3/10/97)[gone]
Rally to support Destiny manifest (3/12/97)[gone]
Deal near in Destiny Telecomm Suit (3/15/97)[gone]
Destiny Agrees to Pay Fine, Revamp Business (SF Chronicle, 3/19/97)
Destiny Settles Lawsuit (3/19/97)
Record New York Fine in Pyramid Scheme (5/28/97)
Destiny Telecomm fined in New York (6/18/97)[gone]
Destiny asked to explain mistake (7/17/97)[gone]
Destiny packs its bags for Texas (7/23/97)
Local companies sue Destiny for past bills (8/7/97)
Pair try to help Little League get phone cards working (8/14/97)
Illinois AG Sues Destiny (11/5/97)
Destiny Telecomm corporate home page (gone 9/2/97)
Team International (International Resource Group as of 7/28/97)
Tom and Sue Bentley (Networkers Internationale)
Dale and Karen Boyd (gone 8/6/97)
Clint Bushaw (Eagle Team) (Renaissance USA as of 9/9/97)
Elaine Camyn (represents Changes International but web page includes Destiny Telecomm in the keywords list)
Miriam Clark (New World Marketing) (gone 4/4/98)
Patrick Clarke (New World Marketing) (gone 4/4/98)
Eldridge Currie (Destiny page missing as of 8/1/97)
B. J. David & John David (Team Global)
Joseph Flaherty (also representing HOPE) (gone 9/9/97)
Mike Gaudin (Eagle Team) (Renaissance USA as of 9/9/97)
Lu Rae Hannon (Eagle Team) (Renaissance USA as of 9/9/97)
Bill and David Haupt (switched to Ameristar Worldwide Entertainment)
Paul Haynes
Gary Hilgeman (New World Marketing) (gone 4/4/98)
S & G Jackson (gone 9/9/97)
Brenda Jamison (New World Marketing) (gone 4/4/98)
David Johnson (switched to Sunridge Lottery Tickets as of 7/28/97)
Lynwood & Anna Jones (gone 9/9/97)
JSE (gone 10/23/97)
William Koester (gone 4/4/98)
[name omitted by request] (New World Marketing) (gone 4/4/98)
Jann Martin (MTW Team Solutions) (gone 4/4/98)
MBL Marketing (switched to "Gifting Program" before 7/28/97, then selling books as of 7/31/97)
David McCall (representing KallCent$ as of 9/7/97)
Errol McFarlane (New World Marketing) (gone 4/4/98)
Duane McKay (gone 10/23/97)
Kimberly Drake & Victoria McMartin (gone 4/4/98)
Glynn Miller (New World Marketing) (gone 4/4/98)
Paul Mullins
Myers Team (gone 6/8/97)
Maurice Pierce
Jerry Relth (gone 10/23/97)
Michelle Reyes (New World Marketing) (gone 4/4/98)
John Roe (New World Marketing) (gone 4/4/98)
Cynthia S. (Eagle Team) (Renaissance USA as of 9/9/97)
Mark and Theresa Seedorf
Wayne Stewart (gone 6/8/97)
Scott Tarnell (New World Marketing) (gone 9/12/97)
N. Taylor
Jim & Marla Thomas
Robert Tucker (gone 4/4/98)
Leslie Turner (New World Marketing) (gone 4/4/98)
Steve Veltkamp (gone 10/23/97)
Verb-o-Comm (representing Infodisk as of 4/4/98)
David Weld (switched to Unified International as of 7/28/97)
Ron Wilmot (switched to Calorad)
A quitter!
Buy Online
Team Europe
Destiny Telecomm Canada (gone 4/4/98)
Home Based Business (gone 7/28/97)

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