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{{Short description|American multi-level marketing company}}
'''YTB International''' ({{Otcbb|YTBLA}}), sometimes known as '''Your Travel Biz''', operates a "[[network marketing]]" opportunity under the holding company YourTravelBiz.com, Inc. through owner-affilliate websites offering travel, excursions, and lodging. Participants, who pay a $495 set up fee and $50 per month to maintain an "online travel agency" website,<ref name=suitpr>{{cite web|url=http://ag.ca.gov/newsalerts/release.php?id=1596|title=Brown Sues To Topple Online Pyramid Scheme|last=Gareth|first=Lacy|date=August 05, 2008|publisher=California Attorney General Press Office|accessdate=2008-09-14}}</ref> can collect commissions for recruiting new participants, utilize the website for their own travel purposes, as well as sell travel packages to others.<ref>{{cite news|url=http://travel.latimes.com/articles/la-trw-travelsuit5-2008aug05|title=Jerry Brown sues YourTravelBiz.com over alleged pyramid scheme|last=Lifsher|first=Marc|date=August 05, 2008 |publisher=''[[Los Angeles Times]]''|accessdate=2008-09-14}}</ref> YTB International is a member of the [[Direct Selling Association]].<ref>{{cite web|url=http://www.dsa.org/press/press_releases/index.cfm?fuseaction=show_release&Document_id=1883|title=DSA Statement Regarding the California Attorney General’s Complaint Against YourTravelBiz.com|last=Robinson|first=Amy|date=August 8, 2008|publisher=[[Direct Selling Association]]|accessdate=2008-09-14}}</ref>
{{more citations needed |date= June 2023}}
{{Infobox company
| name = YTB International
| logo = YTB International (emblem).jpg
| type = [[Private company|Private]]
| traded_as =
| foundation = {{start date and age|2001}}<br>[[Alton, Illinois]], [[United States|U.S.]]<br />
| founder = J. Lloyd “Coach” Tomer,<br> Scott Tomer and<br> Kim Sorensen
| location_city = [[Wood River, Illinois]]
| num_employees = 120 <small>(2010)</small>
| industry = [[Travel]]
| homepage = {{URL|https://www.ytb.com}}
}}


'''YTB International''', known as '''YTB Global Travel''', '''Your Travel Biz''' or '''YTB''', is a [[multi-level marketing]] business through owner-affiliated websites offering travels, excursions, and lodgings. The company was funded in 2001 by J. Lloyd Tomer, Scott Tomer, and Kim Sorensen. The company is currently owned by Sam Hathi.
[[California Attorney General]] [[Jerry Brown]] and former employees sued the company in early August, 2008, alleging it to be a pyramid scheme, among other claims. The Illinois [[Better Business Bureau]] and [[Illinois Attorney General]] [[Lisa Madigan]] joined Brown in investigating the company.<ref>{{cite news|author=Steve Gonzalez|url=http://www.stclairrecord.com/news/214177-ytb-targeted-in-federal-class-action-lawsuit|title=YTB targeted in federal class action lawsuit|publisher=[[Madison County Record]]}}</ref>


Between 2006 and 2009 the company was the subject of several lawsuits and investigations in [[California]], [[Illinois]], and [[Rhode Island]] that alleged the company was a [[pyramid scheme]] and had used deceptive marketing.<ref>{{cite news |url=http://www.stltoday.com/stltoday/business/stories.nsf/story/7647B35CE68492D186257604000C930D?OpenDocument |title=YTB sales rep meeting is here |last=Logan |first=Tim |date=July 31, 2009 |newspaper=[[St. Louis Post-Dispatch]] |access-date=2009-08-12}}</ref><ref name="RI" /> A subsequent decline in revenues led to the company's bankruptcy in 2013, after which it was purchased by Jamraval, Inc. and reorganized under the name YTB Global Travel.
⚫
Other YTB subsidiaries include YTB Travel Network, Inc. and REZconnect Technologies, Inc, with which YTB merged in 2004.<ref>http://findarticles.com/p/articles/mi_m0EIN/is_2005_Jan_5/ai_n8683762</ref><ref>{{cite news|url=http://www.prweb.com/releases/2004/9/prweb162804.htm|title=REZCONNECT TECHNOLOGIES,Inc. MERGES WITH YTB TO CREATE MEGA TRAVEL ORGANIZATION|publisher=[[PRWeb]]}}</ref> The company is based in [[Wood River, Illinois]]. International subsidiaries operate in the U.S., Puerto Rico, the Bahamas, Bermuda and Canada.<ref>http://www.secinfo.com/d12TC3.t2Gq.d.htm</ref>


⚫
Other YTB subsidiaries include YTB Travel Network, Inc., Zamzuu, Inc., and REZconnect Technologies, Inc. (2004–2009). YTB is based in [[Wood River, Illinois]]. International subsidiaries operate in the U.S., Puerto Rico, the Bahamas, Bermuda, and Canada.<ref>[http://www.secinfo.com/d12TC3.t2Gq.d.htm SEC Info - YTB International/Inc - 8-K - For 1/12/08 - EX-99.1]</ref>
⚫
==History==
J. Lloyd "Coach" Tomer, his son Scott Tomer, and Kim Sorensen launched YTB in 2001. The company's business model of selling travel-related websites to work-at-home travel sales agents has been the same since its inception. Growth was slow until 2004, when YTB's creators bought controlling interest in a related company, increased their marketing budget, and aggressively recruited new members with videos of successful salespeople --- along with material incentives for their best performers.<ref name=Logan>{{cite news|url=http://www.stltoday.com/stltoday/business/stories.nsf/business/story/7ef3275c5fbee143862574b600121327?OpenDocument|title=YTB sells dream of prosperity, but some say it is a nightmare|last=Logan|first=Tim|date=August 31, 2008|publisher=''[[St. Louis Post-Dispatch]]''|accessdate=2008-09-13}}</ref> In 2007, 73% of YTB's revenue came from the sale of YTB websites and monthly fees, with a further 10% from the sale of marketing and training material to members. 14.5% came from the sale of travel.<ref>{{cite web|url=http://ag.ca.gov/cms_attachments/press/pdfs/n1596_civil_pleading_ytb.pdf|title=California v. YourTravelBiz.com, et al: Complaint|date=August 2008|publisher=California Attorney General|accessdate=2008-09-14}}</ref> The company's success led to a $25 million new headquarters in a rehabbed [[Kmart]] building to accommodate its rapidly growing staff.<ref>{{cite news|title=Travel company will expand its headquarters; YTB International will spend $25 million to rehab a former Kmart in Wood River|last=Logan|first=Tim|date=August 24, 2007|publisher=''[[St. Louis Post-Dispatch]]''|pages=Business, pg. B2|accessdate=2008-09-14}}</ref> The number of agents increased exponentially until 2008, when it shrunk slightly:
{{Table
|type=class="wikitable"
|title=Agents per year
|hdrs=Year!!Number of agents<ref name=Logan /><ref>{{cite news|title=Number of agents shrinks|last=Logan|first=Tim|date=August 15 2008|publisher=''[[St. Louis Post-Dispatch]]''|pages=Business, pg. B2|accessdate=2008-09-14}}</ref>
|row1=2004{{!!}}8,500
|row2=2005{{!!}}22,000
|row3=2006{{!!}}~60,000*
|row4=2007{{!!}}131,000
|row5=March 2008{{!!}}138,800**
|row6=June 2008{{!!}}131,600**}}
:<nowiki>*</nowiki>Source indicates "nearly 60,000". <nowiki>**</nowiki>The second source is for the figures for 2008.


⚫
== History ==
YTB laid off 17 employees in late August, 2008, stating the move was part of a reorganization.<ref>{{cite news|URL=http://www.bizjournals.com/stlouis/stories/2008/08/25/daily112.html|title=YTB cuts 17 positions|publisher=''[[St. Louis Business Journal]]''|date=August 29, 2008}}</ref> {{asof|2008}} the company's revenues are $44.8 million.<ref>{{cite news|url=http://money.cnn.com/news/newsfeeds/articles/prnewswire/200808151540PR_NEWS_USPR_____NYF073.htm|title=YTB International Announces Financial Results for the Second Quarter of Fiscal 2008|author=PRNewswire-FirstCall|date=August 15, 2008|publisher=[[CNNMoney.com]]|accessdate=2008-09-14}}</ref>
J. Lloyd "Coach" Tomer, his son Scott Tomer, and Kim Sorensen launched YTB in 2001 in [[Alton, Illinois]].


In 2004, YTB's founders bought interest in a related company, REZconnect Technologies, and increased their marketing budget. Members were then recruited through videos of successful salespeople.<ref>{{cite news |date=January 5, 2005 |title=REZconnect Technologies, Inc., into Which YourTravelBiz.com, Inc. Had Previously Been Merged, Has Reincorporated in Delaware, Changed the Name of the Company to YTB International, Inc. and Now Has YTBL as Its New Trading Symbol |work=Business Wire |url=http://findarticles.com/p/articles/mi_m0EIN/is_2005_Jan_5/ai_n8683762}}</ref><ref>{{cite news |title=REZCONNECT TECHNOLOGIES, Inc. MERGES WITH YTB TO CREATE MEGA TRAVEL ORGANIZATION |publisher=[[PRWeb]] |url=http://www.prweb.com/releases/2004/9/prweb162804.htm|archive-url=https://web.archive.org/web/20041215171515/http://www.prweb.com/releases/2004/9/prweb162804.htm|url-status=dead|archive-date=December 15, 2004}}</ref><ref name="Logan">{{cite news |last=Logan |first=Tim |date=August 31, 2008 |title=YTB sells dream of prosperity, but some say it is a nightmare |newspaper=[[St. Louis Post-Dispatch]]}}</ref>
YTB have stated they are considering replacing their referring travel agent business model with one based around franchises.<ref>{{cite news|title=YTB International Contemplates Implementation of Franchises|url=http://www.mywire.com/a/PRNewswire/YTB-International-Contemplates/6950258?extID=10051|publisher=[[PR Newswire]]}}</ref> On October 18, 2008, they introduced a new tier of affiliates in an attempt to fit better into the travel industry, saying the new training program they will be introducing for those who remain as 'referring travel agents' improves over the previous "one-day classroom event".<ref>{{cite news|url=http://www.travelweekly.com/article.aspx?id=181020|title=YTB creates 'affiliates' label for agents making referrals only|author=Nadine Godwin}}</ref>


In 2007 [[Royal Caribbean International|Royal Caribbean]] stopped doing business with YTB. They described the company as a "card mill", an industry term for businesses that sell "travel agent identification cards" to customers, promising travel discounts or other perks and a commission on any sales of these kits to other consumers.<ref>{{cite news |last1=Jainchill |first1=Johanna |last2=Godwin |first2=Nadine |date=15 October 2007 |title=Royal Caribbean throws 3 'card mills' overboard |work=Travel Weekly |url=http://www.travelweekly.com/article3.aspx?id=134600 |access-date=10 August 2014}}</ref><ref>{{Cite web |title=YTB defends its business practices |url=https://www.travelweekly.com/Travel-News/Travel-Agent-Issues/YTB-defends-its-business-practices |access-date=2023-03-01 |website=www.travelweekly.com |language=en}}</ref><ref>{{Cite web |last=Biesiada |first=Jamie |date=February 10, 2016 |title=Ghosts of card mills |url=https://www.travelweekly.com/Travel-News/Travel-Agent-Issues/Ghosts-of-card-mills |website=Travel Weekly}}</ref>
==Pyramid scheme accusations==
Critics, including [[California Attorney General]] [[Jerry Brown]] -- as well as former associates suing the company, allege that its operation is a scam and a [[pyramid scheme]]. Brown sued the company for $25 million in early August 2008, charging unfair business practices, false advertising, and operating a "gigantic pyramid scheme that is immensely profitable to a few individuals on top and a complete rip-off for most everyone else".<ref>Kelsey Volksmann (August 5, 2008). [http://www.bizjournals.com/losangeles/stories/2008/08/04/daily11.html Brown sues over alleged pyramid scheme], Los Angeles Business from bizjournals.</ref> Brown found that in 2007, only 38% of members earned commissions on travel, and those who did earn a commission made a median income of $39, less than the monthly fee for a YTB website.<ref name=suitpr/> According to the ''[[St. Louis Post-Dispatch]]'', [[SEC]] filings showed that the company's three creators earned more than $2 million in 2007, a dozen salespeople earned more than $800,000, and dozens earned more than $100,000.<ref name=Logan /> The ''Post'' quotes Brown's lawsuit as indicating that 45,000 sales reps earned an average of about $90 in 2007 and of their 200,000 agents, 125,000 earned nothing and 37,000 earned less than $39.<ref name=Logan />


In 2008 the company was sued by [[California Attorney General]] [[Jerry Brown]]. An out-of-court settlement required changes to the company's business model and generated a decrease in membership attributed to bad publicity.<ref name="slide">{{cite news |last=Logan |first=Tim |date=1 March 2013 |title=Long slide lands YTB in bankruptcy court |newspaper=St. Louis Post-Dispatch |url=http://www.stltoday.com/business/local/long-slide-lands-ytb-in-bankruptcy-court/article_0cf832a6-6ab5-591b-a852-2588ccd49b83.html |access-date=28 May 2014}}</ref><ref name="Barr">{{cite news |last=Barr |first=Diana |date=5 March 2013 |title=YTB International files for Chapter 11 bankruptcy |newspaper=St. Louis Business Journal |url=http://www.bizjournals.com/stlouis/news/2013/03/05/ytb-international-files-for-chapter-11.html?page=all |access-date=29 May 2014}}</ref> Later that year, YTB laid off 17 employees.<ref>{{cite news |date=August 29, 2008 |title=YTB cuts 17 positions |publisher=[[St. Louis Business Journal]] |url=http://www.bizjournals.com/stlouis/stories/2008/08/25/daily112.html}}</ref> In 2008 the company's revenues were $44.8 million.<ref>{{cite news |author=PRNewswire-FirstCall |date=August 15, 2008 |title=YTB International Announces Financial Results for the Second Quarter of Fiscal 2008 |work=Reuters |url=https://www.reuters.com/article/pressRelease/idUS195832+15-Aug-2008+PRN20080815 |url-status=dead |access-date=2009-07-18 |archive-url=https://archive.today/20120907130600/http://www.reuters.com/article/pressRelease/idUS195832+15-Aug-2008+PRN20080815 |archive-date=2012-09-07}}</ref><ref>{{cite news |title=SEC Info: Annual Report |url=http://biz.yahoo.com/e/080331/ytbla.ob10ksb.html |access-date=1 June 2014}}</ref> YTB said its independent auditor at the end of 2008 expressed "substantial doubt about our company's ability to continue as a going concern,"<ref name="settlement">{{cite news |last=Lifsher |first=Marc |date=May 15, 2009 |title=California settles with Internet travel business it accused of running pyramid scheme |newspaper=[[Los Angeles Times]] |url=http://www.latimes.com/business/la-fi-travel-crackdown15-2009may15,0,3670191.story |access-date=2009-05-15}}</ref> a sentiment the company later echoed.<ref name="losswidens">{{cite news |last=Tritto |first=Christopher |date=August 7, 2009 |title=YTB loss widens, sales plummet |publisher=[[St. Louis Business Journal]] |url=http://www.bizjournals.com/stlouis/stories/2009/08/03/daily68.html |access-date=2009-08-12}}</ref>
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Several former agents filed a class-action lawsuit — seeking to include more than 1,000 of their peers — around the same time, alleging the company to be an illegal pyramid scheme. The lawsuit says that the company "claims to sell travel services, but said company's main business is inducing others to become travel agents".<ref name=Volkman>Kelsey Volkmann (August 11, 2008). [http://www.bizjournals.com/stlouis/stories/2008/08/11/daily14.html Former agents sue YTB International]. ''[[St. Louis Business Journal]]''.</ref> YTB responded by stating that it intends to "vigorously defend the case".<ref name=Volkman /> [[Illinois Attorney General]] [[Lisa Madigan]], after her office and the Illinois [[Better Business Bureau]] received more than 150 complaints about the company, partnered with Brown's office in his state's investigation of the company. The BBB indicated that 80% of YTB revenue came from new agent recruitment, with agents earning an average of $111 per year, almost $400 less than the initial $499 sign-up price.<ref>Kelsey Volkman (August 8, 2008). [http://www.bizjournals.com/stlouis/stories/2008/08/04/daily87.html UPDATED: BBB received 90 complaints about YTB, Ill. AG received 70]. ''[[St. Louis Business Journal]]''.</ref>


In 2009 the company operated at a loss of $1.9 million for the first three months of the year. Revenue in that quarter dropped 49% to $21.8 million<ref name="settlement" /> and then to $18 million in the second quarter.<ref name="losswidens" /> The number of the company's paying members declined from a high in April 2008 of 138,000 to 60,414 in mid-2009.<ref>{{cite news |last=Logan |first=Tim |date=August 11, 2009 |title=Earnings |pages=Business, p. A10 |newspaper=[[St. Louis Post-Dispatch]]}}</ref> This decline in revenue led the company to sell several commercial properties, including the company's Learjet.<ref name="logan2008">{{Citation |author=Logan, Tim |title=YTB growth stalls in Q3, sells assets |url=http://www.stltoday.com/blogzone/business-news/biz-buzz/2008/11/ytb-growth-stalls-in-q3-sells-assets/ |work=Blog Zone |publication-date=2008-11-17 |archive-url=https://archive.today/20090603013155/http://www.stltoday.com/blogzone/business-news/biz-buzz/2008/11/ytb-growth-stalls-in-q3-sells-assets/ |publisher=[[St. Louis Post-Dispatch]] |archive-date=2009-06-03 |url-status=dead}}</ref> That year YTB also sold RezConnect to company officers. Under the terms of the sale, YTB would [[indemnification|indemnify]] the new owners for any YTB-related liabilities.<ref>{{cite news |last=Godwin |first=Nadine |date=July 9, 2009 |title=YTB sells RezConnect to executives |newspaper=Travel Weekly |url=http://www.travelweekly.com/article3_ektid197476.aspx?terms=*ytb* |access-date=2009-07-18}}</ref>
Several current YTB reps have characterized the complaints from former agents as [[wiktionary:Sour grapes|sour grapes]] from those who didn't spend enough time attending to their business. "We are proud of our business model and how our operations are conducted in an ethical and transparent way," said chief executive Scott Tomer. "We also are wholly confident that our business model will withstand scrutiny, and look forward to setting the record straight in court."<ref>Tim Logan (August 8, 2008). [http://www.stltoday.com/stltoday/business/stories.nsf/0/D161A4BA9E78CBE68625749F0012C1AB?OpenDocument Illinois launches probe into YTB International travel company], ''[[St. Louis Post-Dispatch]]''.</ref>


In 2011 the company sold its headquarters building and adjoining property for $7.6 million.<ref>{{cite news |last=Volkmann |first=Kelsey |date=25 March 2011 |title=YTB to sell Wood River headquarters for $7M |newspaper=St. Louis Business Journal |url=http://www.bizjournals.com/stlouis/news/2011/03/25/ytb-to-sell-wood-river-headquarters.html |access-date=29 May 2014}}</ref> In October 2011, a newly formed company, Sixth Scott LLC, began purchasing YTB Travel Network from YTB International.<ref>{{cite news |last1=Jainchill |first1=Johanna |date=2 November 2011 |title=Travel veteran Jeff Scott is YTB's new owner |work=Travel Weekly |url=http://www.travelweekly.com/Travel-News/Travel-Agent-Issues/Travel-veteran-Jeff-Scott-is-YTB-s-new-owner/ |access-date=10 August 2014}}</ref><ref>{{cite news |last1=Jainchill |first1=Johanna |date=27 October 2011 |title=YTB's travel operations purchased |work=Travel Weekly |url=http://www.travelweekly.com/Travel-News/Travel-Agent-Issues/YTB-s-travel-operations-purchased/ |access-date=10 August 2014}}</ref> The company was relaunched as First Alliance Travel in 2012.<ref>{{cite news |last1=Rice |first1=Kate |date=8 October 2012 |title=Company launches host agency with YTB assets |work=Travel Weekly |url=http://www.travelweekly.com/Travel-News/Travel-Agent-Issues/Company-launches-host-agency-with-YTB-assets/ |access-date=10 August 2014}}</ref>
⚫
YTB was also investigated for similar allegations in Rhode Island.<ref>{{cite news|url=http://traveltrade.com/news_article.htm?id=326|title=RI Agency Investigates YTB Business Model|author=George Dooley}}</ref>


On February 1, 2012, founder J. Kim Sorenson died at the age of 62.<ref>{{cite news |title=YTB Travel executive Kim Sorensen dies |work=Travel Weekly publication |publisher=Travel Weekly |url=http://www.travelweekly.com/cruise-travel/ytb-travel-co-founder-kim-sorensen-dies/ |access-date=2012-02-02}}</ref> In March 2012 the YTB announced a plan to merge with LTS Nutraceutical, another MLM firm. In May, the company began a major restructuring and stated that the President and CEO, Robert Van Patton, had submitted his resignation. In September, YTB called off the merger and announced that founder and chairman Scott Tomer was resigning.<ref name="slide" /><ref name="Barr" /><ref name="Barr-2">{{cite news |last=Barr |first=Diana |date=5 September 2012 |title=YTB calls off LTS merger, Chairman Scott Tomer resigns |newspaper=St. Louis Business Journal |url=http://www.bizjournals.com/stlouis/news/2012/09/05/ytb-calls-off-lts-merger-chairman.html |access-date=29 May 2014}}</ref>
Other complaints include deceptive or misleading claims about comissions by reps. One such claim is making 60% of the comission on a travel sale, but actually is 60% of YTB's comission on the sale.

On March 1, 2013, YTB International filed for [[Chapter 11 protection]] in federal court in St. Louis. The company filed its last quarterly earnings report in the third quarter of 2011, although the company later announced that the report contained errors.<ref name="slide" /><ref name="Barr" /><ref>[http://www.secinfo.com/dUuzd.xaw.d.htm SEC filing w.r.t. to Chapter 11 protection]</ref>

On October 11, 2013, YTB completed the sale of its assets to Chicago-based businessman Sam Hathi of Jamraval, Inc. Since being acquired YTB has operated as YTB Global Travel.<ref name="YTB emerges">{{cite web |last=Brown |first=Lisa |title=Chicago investor acquires YTB business |date=11 October 2013 |url=http://www.stltoday.com/business/local/chicago-investor-acquires-ytb-business/article_59a2524a-dc79-544f-b6e4-a8bfced71c77.html |access-date=11 February 2014 |publisher=St Louis Biz Journals}}</ref> As of March 2, 2015 the company ceased enrolling new agents and representatives but still provides resources for existing members.<ref>{{Cite web |title=Ghosts of card mills |url=https://www.travelweekly.com/Travel-News/Travel-Agent-Issues/Ghosts-of-card-mills |access-date=2023-06-06 |website=www.travelweekly.com |language=en}}</ref>

==Lawsuits==
In August 2008 [[California Attorney General]] [[Jerry Brown]] sued the company for $25 million, alleging it to be a [[pyramid scheme]], among other claims.<ref>{{Cite web |title=YTB: What's true and what isn't |url=https://www.travelweekly.com/Travel-News/Travel-Agent-Issues/YTB-What-s-true-and-what-isn-t |access-date=2023-03-16 |website=www.travelweekly.com |language=en}}</ref> The Illinois [[Better Business Bureau]] and [[Illinois Attorney General]] [[Lisa Madigan]] joined Brown in investigating the company.<ref>{{cite news |author=Steve Gonzalez |url=http://www.stclairrecord.com/news/214177-ytb-targeted-in-federal-class-action-lawsuit |title=YTB targeted in federal class action lawsuit |publisher=[[Madison County Record]]}}</ref><ref>{{cite news|last=Volkmann|first=Kelsey|title=Brown sues over alleged pyramid scheme|url=http://www.bizjournals.com/losangeles/stories/2008/08/04/daily11.html|access-date=28 May 2014|newspaper=L.A. Biz (St. Louis Business Journal)|date=5 August 2008}}</ref> Brown's lawsuit indicates that 45,000 sales reps earned an average of about $90 in 2007 and of their 200,000 total agents, some 125,000 earned nothing and 37,000 earned less than $39.<ref name=Logan /> On May 14, 2009, California authorities settled their suit with YTB for $1 million. As part of the settlement, YTB agreed to restructure, possibly hastening a transition to a franchise system. That same day, Madigan filed a similar suit in Illinois.<ref name=logan20090515>{{citation
|url=http://www.stltoday.com/stltoday/business/stories.nsf/story/32ACD29A32AE57D4862575B70002546B?OpenDocument |title=YTB settles with California, promises big changes |last=Logan |first=Tim |date=May 15, 2009 |publisher=[[St. Louis Post-Dispatch]] |access-date=2009-05-15 |archive-url=https://web.archive.org/web/20090520005927/http://www.stltoday.com/stltoday/business/stories.nsf/story/32ACD29A32AE57D4862575B70002546B?OpenDocument |archive-date=May 20, 2009 }}</ref> Brown said the agreement would end the sale of personalized websites that cost $450 to purchase and $50 per month to maintain.<ref name=settlement />

⚫
Around the same time, several former YTB agents filed a [[class-action lawsuit]] that alleged the company was an illegal pyramid scheme. The lawsuit says that the company "claims to sell travel services, but said company's main business is inducing others to become travel agents."<ref name=Volkman>Kelsey Volkmann (August 11, 2008). [http://www.bizjournals.com/stlouis/stories/2008/08/11/daily14.html Former agents sue YTB International]. ''[[St. Louis Business Journal]]''.</ref> YTB responded by stating that it intends to "vigorously defend the case,"<ref name=Volkman /> and the case was dismissed in July 2009 on the grounds that non-residents of Illinois could not pursue the matter under Illinois law.<ref>{{cite news |newspaper=Travel Weekly |title=Judge throws YTB complaint out of court |date=July 21, 2009 |author=Nadine Godwin |url=http://www.travelweekly.com/article3_ektid197844.aspx}}</ref> [[Illinois Attorney General]] [[Lisa Madigan]], after her office and the Illinois [[Better Business Bureau]], received more than 150 complaints about the company, partnered with Brown's office in his state's investigation of the company. The BBB indicated that 80% of YTB revenue came from new agent recruitment, with agents earning an average of $111 per year, almost $400 less than the initial $499 sign-up price.<ref>Kelsey Volkman (August 8, 2008). [http://www.bizjournals.com/stlouis/stories/2008/08/04/daily87.html UPDATED: BBB received 90 complaints about YTB, Ill. AG received 70]. ''[[St. Louis Business Journal]]''.</ref> In May 2011, it was announced that YTB had reached a settlement with the state of Illinois, paying $150,000 in restitution. No admission nor denial of guilt was made in the settlement.<ref>{{cite news|url=http://www.stltoday.com/business/local/article_ec8848e4-654d-11e0-b312-001a4bcf6878.html|title=YTB settles deceptive marketing charges by Illinois|date=May 4, 2011|publisher=StlToday.com}}</ref>

⚫
In 2007, YTB was also investigated for similar allegations in Rhode Island.<ref name=RI>{{cite news|url=http://traveltrade.com/news_article.htm?id=326 |title=RI Agency Investigates YTB Business Model|author=George Dooley |archive-url = https://web.archive.org/web/20080514135632/http://traveltrade.com/news_article.htm?id=326 |archive-date = 2008-05-14}}</ref>

In defense of YTB, chief executive Scott Tomer said, "We are wholly confident that our business model will withstand scrutiny, and look forward to setting the record straight in court."<ref>{{cite news|last=Logan|first=Tim|title=Travel company faces additional investigations Illinois and the local Better Business Bureau are also looking into YTB, which California is suing as a 'gigantic pyramid scheme.'|newspaper=St. Louis Post-Dispatch|date=8 August 2008}}</ref>


==References==
==References==
{{reflist|2}}
{{Reflist|30em}}

==External links==
*{{official website|www.ytbpulse.com}}

{{Multi-level marketing}}

{{DEFAULTSORT:Yourtravelbiz.Com}}
[[Category:Companies based in Madison County, Illinois]]
[[Category:Online travel agencies]]
[[Category:Multi-level marketing companies]]

Latest revision as of 06:37, 15 August 2024

YTB International
Company typePrivate
IndustryTravel
Founded2001; 23 years ago (2001)
Alton, Illinois, U.S.
FounderJ. Lloyd “Coach” Tomer,
Scott Tomer and
Kim Sorensen
Headquarters
Wood River, Illinois
Number of employees
120 (2010)
Websitewww.ytb.com

YTB International, known as YTB Global Travel, Your Travel Biz or YTB, is a multi-level marketing business through owner-affiliated websites offering travels, excursions, and lodgings. The company was funded in 2001 by J. Lloyd Tomer, Scott Tomer, and Kim Sorensen. The company is currently owned by Sam Hathi.

Between 2006 and 2009 the company was the subject of several lawsuits and investigations in California, Illinois, and Rhode Island that alleged the company was a pyramid scheme and had used deceptive marketing.[1][2] A subsequent decline in revenues led to the company's bankruptcy in 2013, after which it was purchased by Jamraval, Inc. and reorganized under the name YTB Global Travel.

Other YTB subsidiaries include YTB Travel Network, Inc., Zamzuu, Inc., and REZconnect Technologies, Inc. (2004–2009). YTB is based in Wood River, Illinois. International subsidiaries operate in the U.S., Puerto Rico, the Bahamas, Bermuda, and Canada.[3]

History

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J. Lloyd "Coach" Tomer, his son Scott Tomer, and Kim Sorensen launched YTB in 2001 in Alton, Illinois.

In 2004, YTB's founders bought interest in a related company, REZconnect Technologies, and increased their marketing budget. Members were then recruited through videos of successful salespeople.[4][5][6]

In 2007 Royal Caribbean stopped doing business with YTB. They described the company as a "card mill", an industry term for businesses that sell "travel agent identification cards" to customers, promising travel discounts or other perks and a commission on any sales of these kits to other consumers.[7][8][9]

In 2008 the company was sued by California Attorney General Jerry Brown. An out-of-court settlement required changes to the company's business model and generated a decrease in membership attributed to bad publicity.[10][11] Later that year, YTB laid off 17 employees.[12] In 2008 the company's revenues were $44.8 million.[13][14] YTB said its independent auditor at the end of 2008 expressed "substantial doubt about our company's ability to continue as a going concern,"[15] a sentiment the company later echoed.[16]

In 2009 the company operated at a loss of $1.9 million for the first three months of the year. Revenue in that quarter dropped 49% to $21.8 million[15] and then to $18 million in the second quarter.[16] The number of the company's paying members declined from a high in April 2008 of 138,000 to 60,414 in mid-2009.[17] This decline in revenue led the company to sell several commercial properties, including the company's Learjet.[18] That year YTB also sold RezConnect to company officers. Under the terms of the sale, YTB would indemnify the new owners for any YTB-related liabilities.[19]

In 2011 the company sold its headquarters building and adjoining property for $7.6 million.[20] In October 2011, a newly formed company, Sixth Scott LLC, began purchasing YTB Travel Network from YTB International.[21][22] The company was relaunched as First Alliance Travel in 2012.[23]

On February 1, 2012, founder J. Kim Sorenson died at the age of 62.[24] In March 2012 the YTB announced a plan to merge with LTS Nutraceutical, another MLM firm. In May, the company began a major restructuring and stated that the President and CEO, Robert Van Patton, had submitted his resignation. In September, YTB called off the merger and announced that founder and chairman Scott Tomer was resigning.[10][11][25]

On March 1, 2013, YTB International filed for Chapter 11 protection in federal court in St. Louis. The company filed its last quarterly earnings report in the third quarter of 2011, although the company later announced that the report contained errors.[10][11][26]

On October 11, 2013, YTB completed the sale of its assets to Chicago-based businessman Sam Hathi of Jamraval, Inc. Since being acquired YTB has operated as YTB Global Travel.[27] As of March 2, 2015 the company ceased enrolling new agents and representatives but still provides resources for existing members.[28]

Lawsuits

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In August 2008 California Attorney General Jerry Brown sued the company for $25 million, alleging it to be a pyramid scheme, among other claims.[29] The Illinois Better Business Bureau and Illinois Attorney General Lisa Madigan joined Brown in investigating the company.[30][31] Brown's lawsuit indicates that 45,000 sales reps earned an average of about $90 in 2007 and of their 200,000 total agents, some 125,000 earned nothing and 37,000 earned less than $39.[6] On May 14, 2009, California authorities settled their suit with YTB for $1 million. As part of the settlement, YTB agreed to restructure, possibly hastening a transition to a franchise system. That same day, Madigan filed a similar suit in Illinois.[32] Brown said the agreement would end the sale of personalized websites that cost $450 to purchase and $50 per month to maintain.[15]

Around the same time, several former YTB agents filed a class-action lawsuit that alleged the company was an illegal pyramid scheme. The lawsuit says that the company "claims to sell travel services, but said company's main business is inducing others to become travel agents."[33] YTB responded by stating that it intends to "vigorously defend the case,"[33] and the case was dismissed in July 2009 on the grounds that non-residents of Illinois could not pursue the matter under Illinois law.[34] Illinois Attorney General Lisa Madigan, after her office and the Illinois Better Business Bureau, received more than 150 complaints about the company, partnered with Brown's office in his state's investigation of the company. The BBB indicated that 80% of YTB revenue came from new agent recruitment, with agents earning an average of $111 per year, almost $400 less than the initial $499 sign-up price.[35] In May 2011, it was announced that YTB had reached a settlement with the state of Illinois, paying $150,000 in restitution. No admission nor denial of guilt was made in the settlement.[36]

In 2007, YTB was also investigated for similar allegations in Rhode Island.[2]

In defense of YTB, chief executive Scott Tomer said, "We are wholly confident that our business model will withstand scrutiny, and look forward to setting the record straight in court."[37]

References

[edit]
  1. ^ Logan, Tim (July 31, 2009). "YTB sales rep meeting is here". St. Louis Post-Dispatch. Retrieved 2009-08-12.
  2. ^ a b George Dooley. "RI Agency Investigates YTB Business Model". Archived from the original on 2008-05-14.
  3. ^ SEC Info - YTB International/Inc - 8-K - For 1/12/08 - EX-99.1
  4. ^ "REZconnect Technologies, Inc., into Which YourTravelBiz.com, Inc. Had Previously Been Merged, Has Reincorporated in Delaware, Changed the Name of the Company to YTB International, Inc. and Now Has YTBL as Its New Trading Symbol". Business Wire. January 5, 2005.
  5. ^ "REZCONNECT TECHNOLOGIES, Inc. MERGES WITH YTB TO CREATE MEGA TRAVEL ORGANIZATION". PRWeb. Archived from the original on December 15, 2004.
  6. ^ a b Logan, Tim (August 31, 2008). "YTB sells dream of prosperity, but some say it is a nightmare". St. Louis Post-Dispatch.
  7. ^ Jainchill, Johanna; Godwin, Nadine (15 October 2007). "Royal Caribbean throws 3 'card mills' overboard". Travel Weekly. Retrieved 10 August 2014.
  8. ^ "YTB defends its business practices". www.travelweekly.com. Retrieved 2023-03-01.
  9. ^ Biesiada, Jamie (February 10, 2016). "Ghosts of card mills". Travel Weekly.
  10. ^ a b c Logan, Tim (1 March 2013). "Long slide lands YTB in bankruptcy court". St. Louis Post-Dispatch. Retrieved 28 May 2014.
  11. ^ a b c Barr, Diana (5 March 2013). "YTB International files for Chapter 11 bankruptcy". St. Louis Business Journal. Retrieved 29 May 2014.
  12. ^ "YTB cuts 17 positions". St. Louis Business Journal. August 29, 2008.
  13. ^ PRNewswire-FirstCall (August 15, 2008). "YTB International Announces Financial Results for the Second Quarter of Fiscal 2008". Reuters. Archived from the original on 2012-09-07. Retrieved 2009-07-18.
  14. ^ "SEC Info: Annual Report". Retrieved 1 June 2014.
  15. ^ a b c Lifsher, Marc (May 15, 2009). "California settles with Internet travel business it accused of running pyramid scheme". Los Angeles Times. Retrieved 2009-05-15.
  16. ^ a b Tritto, Christopher (August 7, 2009). "YTB loss widens, sales plummet". St. Louis Business Journal. Retrieved 2009-08-12.
  17. ^ Logan, Tim (August 11, 2009). "Earnings". St. Louis Post-Dispatch. pp. Business, p. A10.
  18. ^ Logan, Tim (2008-11-17), "YTB growth stalls in Q3, sells assets", Blog Zone, St. Louis Post-Dispatch, archived from the original on 2009-06-03
  19. ^ Godwin, Nadine (July 9, 2009). "YTB sells RezConnect to executives". Travel Weekly. Retrieved 2009-07-18.
  20. ^ Volkmann, Kelsey (25 March 2011). "YTB to sell Wood River headquarters for $7M". St. Louis Business Journal. Retrieved 29 May 2014.
  21. ^ Jainchill, Johanna (2 November 2011). "Travel veteran Jeff Scott is YTB's new owner". Travel Weekly. Retrieved 10 August 2014.
  22. ^ Jainchill, Johanna (27 October 2011). "YTB's travel operations purchased". Travel Weekly. Retrieved 10 August 2014.
  23. ^ Rice, Kate (8 October 2012). "Company launches host agency with YTB assets". Travel Weekly. Retrieved 10 August 2014.
  24. ^ "YTB Travel executive Kim Sorensen dies". Travel Weekly publication. Travel Weekly. Retrieved 2012-02-02.
  25. ^ Barr, Diana (5 September 2012). "YTB calls off LTS merger, Chairman Scott Tomer resigns". St. Louis Business Journal. Retrieved 29 May 2014.
  26. ^ SEC filing w.r.t. to Chapter 11 protection
  27. ^ Brown, Lisa (11 October 2013). "Chicago investor acquires YTB business". St Louis Biz Journals. Retrieved 11 February 2014.
  28. ^ "Ghosts of card mills". www.travelweekly.com. Retrieved 2023-06-06.
  29. ^ "YTB: What's true and what isn't". www.travelweekly.com. Retrieved 2023-03-16.
  30. ^ Steve Gonzalez. "YTB targeted in federal class action lawsuit". Madison County Record.
  31. ^ Volkmann, Kelsey (5 August 2008). "Brown sues over alleged pyramid scheme". L.A. Biz (St. Louis Business Journal). Retrieved 28 May 2014.
  32. ^ Logan, Tim (May 15, 2009), YTB settles with California, promises big changes, St. Louis Post-Dispatch, archived from the original on May 20, 2009, retrieved 2009-05-15
  33. ^ a b Kelsey Volkmann (August 11, 2008). Former agents sue YTB International. St. Louis Business Journal.
  34. ^ Nadine Godwin (July 21, 2009). "Judge throws YTB complaint out of court". Travel Weekly.
  35. ^ Kelsey Volkman (August 8, 2008). UPDATED: BBB received 90 complaints about YTB, Ill. AG received 70. St. Louis Business Journal.
  36. ^ "YTB settles deceptive marketing charges by Illinois". StlToday.com. May 4, 2011.
  37. ^ Logan, Tim (8 August 2008). "Travel company faces additional investigations Illinois and the local Better Business Bureau are also looking into YTB, which California is suing as a 'gigantic pyramid scheme.'". St. Louis Post-Dispatch.
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