Sunday, November 20, 2011

Wayne Allyn Root's Wealth Masters International -- Is It a Scam or Fraud?

Libertarian embarrassment Wayne Allyn Root has long promoted an MLM (multi-level marketing) company called Wealth Masters International (WMI). Some people think all MLMs are ponzi schemes, frauds, or scams. Other people think that some MLMs are honest and legit.

You can see Root hawking WMI in this promotional video. (Root hawks MLMs with the same enthusiasm with which he sells breakfast cereal).

Especially shameless is Root's special appeal to the jobless -- to the people who can least afford risking their savings on a risky MLM.

Root doesn't name "this company" in the video. Like any salesman with a hard-to-sell product, he teases the client with only bits of info, making them want it before letting the other shoe drop (such as the high pricetag). But the video appears on the website.

That website also uses Root's LP credentials to buy credibility for Root and WMI. The site says: "Wayne Allyn Root is a politician, entrepreneur, television and radio personality, author, and a well known political commentator. He was the 2008 Libertarian Party vice-presidential nominee. Today is Chairman of the Libertarian National Campaign Committee."

This past weekend, San Diego anti-tax activist Richard Rider sent out a group email (posted at Independent Political Report) in which he wrote:

"Wayne Allyn Root has been a very effective spokesperson for liberty. Not perfect, but a much better communicator than most libertarians. That is perhaps both his strength and his weakness.

"At heart, Root's a salesman. Nothing wrong with that. So am I (and I’m FAR less effective than he is).

"But I'm afraid that his bottom line is selling dubious products to 'fellow travelers' in the liberty movement. It's called 'affinity selling,' common in belief groups -- religious or not.

"Such seems to be the case below. He's hustling what appears to be an MLM program -- multi-level marketing. You go to the website, and you get a lot of hype and endorsements, but no substance as to what the program is. For that, doubtless you have to sit through a presentation. Bad sign.

"For 20 years I was a CFP financial planner. I worked on commission. I sold good products and bad. While overall I did pretty well for my clients, I made just about every investment mistake there is at one time or another -- except pyramid schemes.

"I also got to review many investment and business propositions brought to me by clients. I can see, feel, taste and smell a hustle.

"Indeed, I contacted the SD COUNTY DA on the infamous local J. David Dominelli commodity pyramid scheme 18 months before it collapsed (the DA did nothing despite two letters I sent detailing my concerns).

"Some MLMs are just harmless pyramid marketing schemes without much front money (think Amway) -- others are terrible frauds. Can’t say which one this is, but I’d bet dollars to donuts it is one or the other.

"One important aspect of such programs is that the salespeople have to BELIEVE in the program. It's almost a religion. Few (generally found at the top of the pyramid) are actual con men, hucksters who understand the game.

"I suspect that Root is a believer. I KNOW he's be a passionate and effective sales person for the deal.

"I caution Libertarians to be skeptical. Indeed, skepticism is a trait that we have in abundance -- except perhaps when we trust the messenger.

"Trust NO ONE in investments -- and especially in MLM. Think Bernie Madoff -- a superb con man who successfully worked his belief group -- Jews. Similar con man Ponzi hustles are particularly common among Mormons and Baptists.

"Let's be VERY careful out there.

Read what the Ripoff Report says about Wealth Masters International.