EDWARDSVILLE, Ill. (CN) - YTB.com (YourTravelBiz.com) is a $500 million pyramid scheme - one of the largest frauds in Illinois history, a class action claims in Madison County Court. The class claims YTB sells promises of cheap travel and million-dollar payouts, but the only way customers can profit is by recruiting others to join an illegal pyramid scheme.
"While over half of the customers received no travel commissions at all, the officers and directors of YTB International Inc. each paid themselves multimillion-dollar salaries while also siphoning tens of millions of dollars from their publicly traded corporation to privately owned corporations that they owned and controlled," the complaint states.
The class claims YTB generates about 75 percent of its revenue by using independent marketing representatives to recruit referring travel agents to buy online travel agencies from the defendants.
Independent marketing representatives receive "marketing commissions" if the people they refer to YTB buy online travel agencies, according to the complaint. The claims that independent marketing representatives cannot be effective unless they become referring travel agents themselves.
The class consists of all independent marketing representatives who paid non-reimbursed referring travel agent fees to YTB. It seeks damages for fraud.
The class is represented by Christian Montroy of East St. Louis.
The defendants include YTB International, several YTB subsidiaries, including Rezconnect Technologies, and five individuals: J. Lloyd Tomer, J. Scott Tomer, J. Kim Sorensen, Andrew Cauthen, and Michael Brent.
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