Please, first read part 1 below this article.
Not only have the Lyoness instigators been deviously clever in hiding their trails and obstructing justice, they have also thought through every single step of their latest racket in order to enroll and dupe as many people as possible, without getting caught and probably without being held to account when the walls come down.
As reported earlier, the disguise of the Lyoness racket was tailored to meet the spirit of current times and the specific character of a country's society. In the United States, Lyoness emphasises that its business model has nothing to do with 'MLM'; in other countries, Lyoness propagates how 'MLM' is the way to 'financial freedom'. Additionally, the adherents (i.e. propagators) of Lyoness have been instructed to modify the recruitment techniques (by altering the standard scripts available through Lyoness and upline members) they use to enroll new victims, to the specific problems, fears, needs and dreams their prospects may have. For instance, the current economic crises have been used to enroll new 'loyalty merchants', saying that Lyoness is the way for (particularly) small and medium-sized enterprises to build up a loyal customer base, and consequently increase the sales, turnover and profit of these enterprises. Their owners have been deceived into believing that they will be the main beneficiaries of the Lyoness 'business model', whereas consumers have been told that the loyalty merchants are the ones paying for all their extended benefits.
In order to perpetuate their perfectly tailored lie, Lyoness and its instigators had to make a serious effort to establish and maintain a monopoly on the information that is available about Lyoness. One of the ways to achieve this was telling their deluded followers that it's of elementary importance to them achieving the success they've been dreaming of, that they never speak with anyone who's not a member about Lyoness, without decent preparation and an upline present. Another, more visible, method used by Lyoness is to contest every allegation against 'the company' on the Internet, and making - for instance - false copyright infringement claims to get the truth removed. Using these tactics, combined with immediate threats of million dollar lawsuits, Lyoness has even managed to get the Austrian public broadcaster (ORF) and Youtube (owned by corporate giant Google) to remove the truth about Lyoness from their respective websites and servers.
Consequently, it was Lyoness who had the sole right and opportunity to inform its prospects about 'the company'. The way in which this was done, obviously, was orchestrated as well. Using cultic techniques known as 'Neuro-Linguistic Programming' in all its propaganda, Lyoness created a step-by-step timeline, based on which should be decided how much information a person is allowed to, and capable of receiving and processing at that stage (that is, without dropping out of the system).
As stressed earlier, the 'Cashback Card', all other 'discount systems' and the affiliated 'shopping community' are a smokescreen, developed to lure unwitting victims into the web of lies spun by Freidl and his friends to deceive everyone out of as much money as possible. Before joining in on that (regardless of whether one joins as a consumer or as a 'loyalty merchant'), prospects may have been shown nothing more than publicly available information about 'the company' (i.e. what Lyoness has decided to put out there). This information barely makes any reference to the 'position system', if any. This video is an example of such information:
When signed up for the 'Cashback Card', the real fun commences. As stressed by Hubert Freidl in private, the core-business of Lyoness is 'positions, positions, positions, positions' - the discount card is irrelevant, and only useful to give Lyoness a legitimate-seeming disguise, designed to lure more people in. That shows. As reported earlier, only a few Lyoness member actually ever use the 'Cashback Card', and their average savings are scanty at best.
When the next stage in the membership has been reached, the next stage of information-allowance can be entered. Now that the member has visited one or several meetings and has been convinced that Lyoness is 'an excellent company', offering a 'revolutionary system', it is time to bring out the big guns - the position system. Of course, first the thought-stopping nonsense that has been shown to the member earlier is show again. This includes a fixed combination of the benefits for both shoppers and shops, the charity Lyoness and its instigators support, the certificates, the history of the 'company' and the affiliation with major corporations, who apparently have endorsed the Lyoness 'business model'. Also, it is once again stressed that if a member recommends new Lyoness members, a minor percentage (0.5%) over the purchases of these members (and the members they bring in) at Lyoness 'loyalty merchants' will be paid to the recommender.
Then, a little more of the big secret is revealed. Easing in to it, Lyoness emphasises that the discounts listed on their website will not be fully paid out in 'cash back' - part of it will be transferred into a system that saves up the left-over discounts into 'positions'. The irrefutable logic is presented that if more people shop, more discounts get saved up, and therefore, more positions are formed. Then, it is promised that if enough positions (70) have been saved up by shoppers, there will be a financial reward for the owner of the first position.
This all sounds good and still legitimate. However, both the 0.5% 'friendship bonus' over the shoppers brought in and particularly the saving up of discounts resulting into a considerable amount of positions, assumes and requires a considerable amount of shoppers - and considerable spending of these shoppers at the Lyoness 'loyalty merchants'.
Although Lyoness puts emphasis on this system thriving on an endless stream of shopping expenses (which 'will always be there'), it hints at the improbability of a lot of positions getting created by shopping, or at least, the long time it may take before this actually happens. Therefore, Lyoness offers its carefully prepared prospects a solution: the positions can be bought. This way, one gets a head start for when the millions of shoppers are going to role in and buy all their daily groceries and other (luxury) shopping through Lyoness. At this stage, it is disclosed that money can be made through the position system. However, the focus still lays on 'being in first and benefiting from additional positions created by shopping'.
Then, the premium membership is presented. To seem legitimate, Lyoness (currently) first presents the possibility to become a premium member through an extreme amount of shopping expenditures (20,000 euros) at the Lyoness 'loyalty merchants'. This is glanced over, because of course, the second option is way more interesting, shows that the member in question has 'vision' and is a 'top' or 'premium' member. This second option is, obviously, purchasing positions in the position system. If one buys 13 at once (7 of 50 euros; 3 of 150 euros; and 3 of 400 euros), the premium membership is obtained.
Are we done then? No, of course we're not. As soon as the premium membership is obtained, the focus shifts to recruiting. Obviously, again the entire compiled list of advantages tied to Lyoness is summed up (save the world, the environment, huge discounts, etc.), and in the very end, the possibility to become an 'Independent Business Representative' (IBR) is presented. When the opportunity to become an IBR is presented, suddenly saved up, left-over discounts are no longer the important source for constructing new positions - recruiting is the new key word.
Lyoness claims to be looking for 'visionary people', who see that this business will grow over the entire world (a comparison with companies like Apple and Google is coined). Not only will the amount of shoppers and shops affiliated with Lyoness grow considerably; the amount of premium members (i.e. position-buyers) will grow exponentially too. Therefore, acquiring as many as possible positions in the system now, will lead to huge rewards in the future. These rewards will start coming in as soon 4 people have been recruited into Lyoness, provided these 4 people have acquired at least one unit in the position system. Then, based on the amount of positions acquired by the people brought in, and the career level that has been obtained (which is, of course, dependent on the amount of positions as well), a monthly 'system commission' or 'volume commission' is paid out. Of course, then six or seven figure incomes are for grabs.
Everything is dependent on the position system. Or as Hubert Freidl puts it: 'it's all about positions, positions, positions, positions'.
And of course, to get people in and to get them to acquire positions, everything is permitted.
To enhance the confusion, and to make sure that no-one drops out, psychological pressure is applied, critics are discredited and intimidated with lawsuits. The truth that does leave the private sphere of Lyoness (which is inevitable with 2,800,000 members worldwide), gets contested or challenged with false copyright infringement claims. Also, Lyoness has tried to make the truth 'irrelevant' to new members and other observers of Lyoness, by complicating the understanding of Lyoness' 'business model', for instance by constantly changing the terms used for various aspects of this 'business model', which also are often not, not-sufficiently or merely vaguely explained and/or used elsewhere in official Lyoness communication (therefore, the Austrian Consumer Union; VKI; has hired Eric Breiteneder to sue Lyoness). A while ago, 'loyalty merchants' were still called 'trading partners'; 'premium members' were called 'business partners', 'accounting units' were called 'positions'; and 'volume commission' was called 'system commission'.
- To be continued -