glenn turner pyramid scheme

0000005276 00000 n [1] It became entangled in numerous legal difficulties and went out of business in the 1970s.[2]. Well, it was never really worth all that, and when blizzard of Federal and state charges of fraud, securities irregularity and other actions drove him nearly into bankruptcy, he ended up selling one of his companies for $15,000. [26] Faltinsky described Holiday Magic as "..the largest pyramid scam of all time.."[27], In 1967, William Penn Patrick wrote a booklet, entitled Happiness and Success through Principle, and founded Leadership Dynamics based on those principles. 0000007360 00000 n [5][29], William Penn Patrick bought Mind Dynamics in 1970. What a fine madness it was, the heyday of Dare to Be Great. Occasionally the digitization process introduces transcription errors or other problems; we are continuing to work to improve these archived versions. mid plans has focused on a single organization, Glenn W. Turner Enter-prises, Inc., a holding company with 68 subsidiaries3 including the two most successful and most maligned pyramid schemes, DG and its sister company Koscot Interplanetary, Inc. 0000002472 00000 n Marjoe knew, Clifford Irving knew, but Mr. Maxa, who doesn't seem to be just anybody's fool, honestly believes that Turner honestly believed that he was honest. It is apparent from this Court's findings of fact that the defendants are promoting a type of scheme commonly known as a pyramid operation. In 1967 Turner borrowed $5,000 to start his Koscot Interplanetary Inc., a cosmetics firm in which distributors could sell other distributorships for commissions. TimesMachine is an exclusive benefit for home delivery and digital subscribers. Private investors also have claims against the property for $200,000 in tax certificates, under which they paid the taxes and earn 18 percent interest until the property is sold and the tax amounts are paid back to them.. Turner and his family havent paid property taxes since 1979, but investors bought tax certificates equal to the back taxes each year. Our intent was to help people. In the low-interest-rate environment of the past decade, investors put up money with little diligence, and fake it till you make it turned toxic. 0000002201 00000 n ORLANDO, Fla. (AP) _ A three-story, 16-room castle owned by onetime motivational entrepreneur Glenn Turner is going on the auction block, with the Internal Revenue Service and other creditors splitting the proceeds. He then started two multi-level marketing companies, Koscot Interplanetary, selling cosmetics, and Dare to Be Great, selling motivational and self-improvement courses.[30]. JrsJk**j;{:[Z{&N. But as Turners saga shows, theres a dark side baked into the fake it mentality: the fakers who attempt to win success through fraud, then never make good on their promises. 0000000016 00000 n The House was supposed to grow with population. Employing a pyramid selling scheme and an evangelical, downhome platform style, Turner cajoled thousands of ordinary folks into putting up varying amounts, in return for which they would sell Turner's beauty products. vlyiJ)pd*n\[PN>8Yl^1cyO"`CC\=bu3hB And we need to be less credulous and stop falling for the next shiny thing. The Last Podcast on the Left, a podcast covering topics like serial killers, conspiracy theories, and cults, discussed Holiday Magic on a 2023 episode about David Miscavige. v. Robert W. Warren et al. Glenn W Turner, who started in Network Marketing in the late 60s and you will be blown away by the income earnings that he shares from that time. His sales rallies became legend. 0000005276 00000 n [4], Patrick, a student of Alexander Everett (founder of Mind Dynamics), used Mind Dynamics techniques as well as the Silva Method in the Holiday Magic organization. startxref PHOENIX, Ariz. -- Promoter Glenn Turner, who became a millionaire through self-motivation businesses, was sentenced with his business partner to seven years in prison Thursday for defrauding. [6], In February 1973, Holiday Magic was sued for calumny by Avon Products. An interesting man, Glenn Turner, and Rudy Maxa, a Washington Post reporter, has an interesting problemwhat do you do with a con man who doesn't know he's a con man? ". PHOENIX, Ariz. (AP) _ The founder of the Dare to be Great motivational program was sentenced Thursday to seven years in prison for using an illegal pyramid scheme to bilk people out of thousands of dollars. [10] The FTC's decision on Koscot set a precedent for defining if a company is engaging in illegal pyramiding. Dougherty then passed sentence, despite receiving hundreds of letters in support of Turner. . By Rudy ???trated. "Franchising in Hard Times: Hearing Before the Committee on Small Business, House of Representatives. [3] Even then, he never stopped explaining. Just when one has about decided there is little more one wants to know about the harelipped sharecropper's son, the book changes focus to the years of various legal proceedingssecurities irregularities, mail fraud, obtaining money through false pretensesthat finally stopped the unstoppable Turner. The state officer who conducted Turner's investigation noted, "Mr. Turner has demonstrated to this officer an uncanny ability to confuse issues and extend compliments.". WASHINGTON, May 17 The Securities and Exchange Commission asked a Federal District Court today to halt the sale of Glenn W. Turner's pyramid franchising scheme on the ground that it is. "Our intent was to help people believe in themselves.". United States Senate election in Florida, 1974, "Meet the con man who sold America on 'fake it till you make it', "Dare to be Great, Inc! It is here that Mr. Maxa shows unusual ability to compress tedious and protracted legal wrangles (one trial lasted nine months) into an absorbing account. [28], CEO and President Roland R. Nocera pleaded guilty to securities fraud, in the case United States v. Nocera, et al. Yes, the ethos can lead to success, as long as you actually have the goods and the skills. : A Case Study of Pyramid Sales Plan Regulation", "Glenn Turner, Empire Toppled, Trying Again to Sell Motivation", "Glenn Turner -- Out Of Luck; Fraud Sentencing May Be His Day Of Reckoning", "Koscot Cosmetics Accused Of Illegal Business Actions", "Koscot and Turner Cited in Complaint Filed by the S.E.C. %PDF-1.7 % 235 0 obj ", Dougherty said he also took into account that Turner "has on a consistent basis and a generous basis contributed large sums of money . 0000041122 00000 n Theres a difference between psyching yourself up and misrepresenting yourself, and the latter is where fake it has gone too far. When a federal judge lumped together 1,000 of those lawsuits into a single class-action suit seeking nearly $1 billion, Turner went bankrupt. As he was led off to jail, he told reporters: The good that I have done outweighs the bad. In the end, Turner was saved by New Orleans evangelist, known as the Chaplain of Bourbon Street, who also pointed the way to fiscal salvation by introducing Turner to his own business managera former minister himself. If anybody was hurt by our program or suffered because of it, I am sure sorry, Rechtor said. Oaks pleaded guilty last year to one felony count of operating an illegal pyramid scheme and agreed to testify against Turner and Rechtor. If he never quite tells us what made Glenn Turner runthat is was he a con artist or merely an overeupeptic free enterpriser?no one else knew either, including perhaps Turner. Mr. Maxa has the newspaper reporter's habit of cramming in information wherever it will fit, whether apposite or no. Turner, 53, created a $300 million empire in the 1970s by selling distributorships in his Dare to be Great and Koscot International companies. ), it's too late to put the book down. [2][vague] The organization was dissolved in 1974, subsequent to the death of Patrick in 1973. One bought a cosmetics distributorship for $4,500 and became entitled to sell distributorships to others, pocketing a fat commission. 271 0 obj Just before sentencing, Rector told Dougherty that Challenge had done nothing wrong. 0000002201 00000 n But what made him "really rich" was reportedly Koscot Interplanetary[6] (Koscot stood for "Kosmetics for the Communities of Tomorrow"). of plan, which will be referred to as the Glenn Turner or multi-level distributorship scheme, the promoters offer to the public a series of contracts called "Adventures." xref 0000004278 00000 n trailer Dougherty said he had received "hundreds" of letters in support of Turner. "[9], The company was investigated by the Federal Trade Commission,[4][10] and in June 1973 the company was found guilty of deceptive trade practices. 748 - IN THE MATTER OF HOLIDAY MAGIC, INC., ET AL. 0000004119 00000 n <>stream 1975, P. 304., Hearings on S. 483, 1900, 1927, and 1961, and H.R. The empire collapsed in the early 1970s when authorities accused Turner of violating laws against pyramid sales, in which investors at the top make a fortune and those who get in later lose money. By the spring of 1969, Turner was living in a large home on Lake Maitland near Orlando Florida, and "had eight Cadillacs and a Rolls-Royce, three Learjets and a closetful of tailor-made suits and alligator shoes". [17] Turner described it as one of the first "pyramid marketing" companies in America. 2(a) OF THE CLAYTON ACT Docket 8834 (1974), MLM Law - Lawyer Grimes & Reese PLLC - Attorney Specializing in Multilevel Marketing - Marshall v. Holiday Magic, Inc. (1977) 550 F.2d 1173, Door to Door Selling, Pyramid Selling, Multilevel Marketing, "L.A. Con Artist Behind Alleged Electricity Scam: Pyramid scheme linked to coming deregulation", "First Amendment Protection for Commercial Advertising: The New Constitutional Doctrine", "The Chaos of Multilevel Marketing and Pyramid Sales Laws: A Federal Remedy", In Re Koscot Interplanetary Inc., 86 F.T.C. But that came later. He was paroled in November but must be supervised by. [7] As one news story put it: .mw-parser-output .templatequote{overflow:hidden;margin:1em 0;padding:0 40px}.mw-parser-output .templatequote .templatequotecite{line-height:1.5em;text-align:left;padding-left:1.6em;margin-top:0}, Think about it: One person could sell 10 distributorships, and each of the 10 could sell 10 more, and so on. The purpose of this Note is to investigate the 0000004278 00000 n Turner, the son of a sharecropper, told people they could all be rich and successful like him if, that is, they made an investment in his multi-level marketing company. 0000037159 00000 n 256 pp. Dougherty also ordered Turner and Rector to pay $44,000 each in fines to be distributed to victims. [28] The Mind Dynamics course was described as providing "a means of achieving personal success through the conscious use of the subconscious mind". . @D[cnS: lRORRXtkLrr)==mFdQMmnM'tv6KM;J_O3 +F:C+4i[k}d The Challenge program was similar to Turners Dare to be Great program, which won him national attention during the late 1960s and early 1970s, the state attorney generals office said. It didnt. . But what he is actually selling, he . Patrick bought all of the cosmetics supplies for $16,250, and founded Holiday Magic, Inc. After the purchase, Patrick began selling distributorships in his new company. Best Match Powered by Whitepages Premium AGE 80+ Glenn Turner Houston, TX (Inner Loop) View Full Report Addresses Yoakum Blvd, Houston, TX "It is hard for me to believe . <> The book has its lighter moments. A technicality of the law is what got me.[1], Turner passed away in his home in Lake Mary, Florida, on 8 January 2020[13] with a much lower profile than during the peak of his success.[14]. 124., July 6, 1977. When newly minted salespeople found it impossible to make a go of it, they were told to fake it until you make it, by wearing expensive clothes and waving around $100 bills to lure in others, a disillusioned Oregon recruit testified in court in 1972. Annotated bibliography on chain letters and pyramid schemes. Lawyers for Turner and Rector asked Dougherty to let their clients remain free while they appealed their convictions. Those in the positions of Instructor General, Trainer General, and Senior General were required to take the training. "The Role of Small Business in Franchising, Hearings Before the Subcommittee on Minority Small Business. The distributors could make thousands. TimesMachine is an exclusive benefit for home delivery and digital subscribers. This is a digitized version of an article from The Timess print archive, before the start of online publication in 1996. But when the claim has little to no basis in reality, it will almost certainly lead to failure and, as Turner discovered, to oblivion. House Permanent Select Committee on Small Business., 1973, P. 127, 137, 157, 203. Glenn W. Turner worked briefly for Holiday Magic in 1966. Traditionally, businesses have had to state their returns using metrics that can only be faked by lying. 0 0000006496 00000 n House Committee on Small Business, 1991. By the time one arrives at the scene with the Washington lawyers who helped keep Dita Beard under wraps and the description of an old O.S.S. 0000006135 00000 n As Elizabeth Holmes gives way to Sam Bankman-Fried, who gives way to George Santos, its worth pondering why our society has embraced an ethos popularized by a huckster such as Turner. By Rudy Maxa. Anyone can read what you share. This page was last edited on 18 February 2023, at 23:43. The two men told Dougherty before sentencing that they never intended to break the law. %PDF-1.6 % 0000004799 00000 n At the meeting Turner's proteges would run to the stage in their flashy suits and fancy shoes, with $100 or even $1,000 bills pinned to their lapels. 0000008424 00000 n He subsequently bought exclusive rights for Middle East distribution of Holiday Magic cosmetics and formed his own company, Beauty Magic, in Beirut, Lebanon. Mr. Maxa cannot resist quoting H. L. Mencken's observation that no one ever went broke underestimating the intelligence of the American public. What Turner really sold was hope, which is the stock in trade of others beside pyramid sales pushers. The government says Turner owes tens of millions of dollars in taxes and judgments, which have hopelessly tangled the ownership of his partially completed castle on a lake in south Seminole County. 0000003297 00000 n 235 37 Turner packaged this dubious enterprise with a religious fervor that would make Billy Sunday look like the Archbishop of Canterbury. It all carne tumbling down eventually. 0000001660 00000 n Since his victims were usually the little people, the guys who are always getting it in the neck from the system anyway, it was a matter of hitting cripples. Generally, the product or service is of poor quality, overpriced, or has no purpose other than as a ploy to give the company the appearance of legality. Holiday Magic Inc. et al. Koscot Interplanetary. they indicted me on aiding and abetting running a pyramid scheme. USA vs Glenn W. Turner, Nash Publications, New York, 1976 Rudy Maxa . 0000041306 00000 n 0000002472 00000 n Turner barely escaped jail in 1975 when a federal jury in Florida was unable to reach a verdict after a nine-month fraud trial. (As for The Apprentices more famous host Donald Trump, a nepo baby who cosplayed a successful mogul on the show we all know how that turned out.). ", "Opinion This all-but-forgotten con man sold America on 'fake it till you make it', Juice Plus AKA National Safety Associates, European Grouping of Marketing Professionals, https://en.wikipedia.org/w/index.php?title=Koscot_Interplanetary&oldid=1142208959, Creative Commons Attribution-ShareAlike License 3.0, This page was last edited on 1 March 2023, at 02:56. A technicality of the law is what got me. By the time he died in 2020, it took more than a year for a newspaper reporter to stumble across his Legacy.com obituary and make note of his death. %%EOF Turner and Rechtor, who also received seven years, were convicted in July of 19 counts of conspiracy, fraud and promoting a pyramid scheme. Koscot and Dare to be Great grew rapidly and Turner became famous. . "They conspired to get Mr. Turner," said another woman. Corporate shareholders began to prioritize quarterly profits over long-term results. Unfortunately, the multi-level cosmetic company became entangled in numerous legal difficulties and went out of business in the . 0000023584 00000 n In my business, theres just no faking it, Stewart said. The promised El Dorado, however, was reserved for those who put up the requisite amount for becoming distributors; this gave them the right to sell distributorships to others, retaining a healthy percentage of the fee. "[1], Sales Dynamics was another program of instruction for pay available to Holiday Magic Distributors to help them in their business activities. hb```e`` /`"\}!5|Z1O(s@Tu4t5UL- M-\\mm||=C#cbC"R32S Turner, though, had hired a lawyer for his sentencing Thursday. 5616. SAN DIEGOGlenn Arcaro of Los Angeles pleaded guilty today in federal court for his participation in a massive conspiracy involving BitConnect, a cryptocurrency investment scheme, which defrauded investors from the United States and abroad of over $2 billion. Mr. Turner's business, osten sibly, is cosmetics, the keystone product in a bizarre conglom erate called Glenn W. Turner Enterprises, Inc. 0000032500 00000 n 1974., May 20, 1974. Box 1. 0 As it turned out, investors would have to pay $5,000 apiece to participate in the program, which revolved around distributorships for sales of motivational cassettes, classes and books. But nowhere has the ethos of fake it found more fertile soil than in Silicon Valley, where the line between optimism and deceit can admittedly be a fine one. Stewart was behind the societal curve. The companies collapsed in 1973 under lawsuits filed by investors and investigations by state and federal agencies. Wk. 0000005760 00000 n At the same time, the federal government became less likely to prosecute obvious malfeasance. 0000007782 00000 n This is a good little book about an earnest con artist who ripped off the American public for $75 million. "They come from all over this country and abroad. He then started two multi-level marketing companies, Koscot Interplanetary, selling cosmetics, and Dare to Be Great, selling motivational and self-improvement courses. They drove new Cadillacs and wore alligator shoes. 0000003563 00000 n Turner, 57, served nearly two-thirds of a seven-year term in Arizona for fleecing investors in a scheme for distributing motivational tapes. Donate [5] Though he claimed Leadership Dynamics was a separate company, "..in no way related to Holiday Magic, Inc.", Gene Church pointed out many inconsistencies in this statement, in his book The Pit: A Group Encounter Defiled. [12] Holiday Magic was also labeled a "pyramid scheme" and a "multi-level distributorship" by the United States Bureau of Domestic Commerce, in their 1976 published book: Crimes Against Business: A Management Perspective. A few of their supporters cried as the sentences were read. 0000007360 00000 n Targets for citations in Chain Letter Evolution. The castle and boathouse have been vacant for several years, and the castle has been used only for tours by the public for charitable events. that our program was a crime," he said. The Glenn Turner court was confronted with the pyramid sales scheme of Dare to Be Great, Inc., a wholly owned subsidiary of Glenn W. Turner Enterprises, Inc. Ostensibly Dare sold through four "adven-tures" and one "plan" a motivation training course consisting of printed On this Wikipedia the language links are at the top of the page across from the article title. . "They come from preachers, lawyers, housewives, plumbers, carpenters," Dougherty said. [7] (In 1972 he built a "$3.5 million white stone castle with a helicopter landing pad" on Bear Gulley Lake, also near Orlando. No. Yes, Mencken would have loved it. 0000006933 00000 n Ward, et al. [7], When some salespeople found customers in short supply, Turner encouraged them to 'fake it until you make it,' by wearing expensive clothes and waving around $100 bills to lure in others". 0000006135 00000 n Illustrated. 235 37 Turner and his best friend, Edward G. Rector, were each sentenced to seven years in state prison. This is a digitized version of an article from The Timess print archive, before the start of online publication in 1996. Morrow. Both stood with their hands folded behind their backs as Dougherty announced the prison terms. Koscot Interplanetary was a company from Orlando, Florida, selling mink oil-based cosmetics and was started by Glenn W. Turner in 1967. If it can happen to Charles Colson, folks, you gotta believe. 0000023769 00000 n In 1964, after a bankruptcy and several business failures, Patrick (age 33) was walking by a garage in San Rafael, California, and noted that fruit-scented cosmetics were being sold. According to 2019 surveys done by the Pew Research Center, almost half of us say Americans are not as reliable as in the past. 0000031956 00000 n deal). They were convicted last month on charges of conspiracy, fraud and illegal pyramid sales in connection with their Challenge Inc. motivational program. 0000008424 00000 n As we transitioned from a society that manufactured things to one whose products were intangible, reality was increasingly in the eye of the beholder or the pitchman. ", Nevertheless, Dougherty said, the men deserved prison terms because "some of these victims suffered great emotional and financial harm by your actions.". However from a technical perspective, there are differences in the way the two types of schemes operate. Anyone can read what you share. [25] The Office of the State Attorney General in Maine, United States cites In re Holiday Magic, Inc., 84 F.T.C. The company called Zolene was about to go out of business. ", United States Congress. Before the IRS gets its share, Seminole County has the right to collect $16,900 in unpaid property taxes for 1987, said county Tax Collector G. Troy Ray. On this Wikipedia the language links are at the top of the page across from the article title. Two years later he founded Dare to be Great, a motivational program similar to the later Challenge. [28], Ben Gay, a high-level instructor at Leadership Dynamics, was President of Holiday Magic in the United States. However, the focus of the company was more about selling distributorships than cosmetics. 0000003563 00000 n "All you have to do is believe it."[7]. The judge refused and the men were led away to jail by deputy sheriffs after they gave their wallets, watches and jewelry to friends in the courtroom. Prosecutors said Challenge officials misled investors by telling them they would not have to put up their own money. endstream endobj 166 0 obj <>stream Turner, imprisoned in Arizona prison for fraud, has owed the IRS millions of dollars in back taxes for more than a decade, and the agency has succeeded in foreclosure proceedings against the property in Seminole County. [3] An estimated 70 companies (as of 1972)[4] were owned by Turner (owned by Glenn W. Turner Enterprises, Inc.):[1] Dare to Be Great, which sold motivational and self-improvement courses, and also functioned as a multi-level marketing company;[5] Turner had also briefly worked for Holiday Magic, another multi-level marketing company that sold home-care products and cosmetics, and through related companies sold self-improvement programs. It's easy and secure. endstream endobj 165 0 obj <>stream (unrelated to Holiday Magic). xref [11], In 1973, a federal judge in Pittsburgh combined more than 1,000 lawsuits by unhappy Koscot investors and regulatory officials into "a single class-action lawsuit seeking more than $900 million. Thus one gets sentences such as Meanwhile, in a downtown Frankfurt prison, thirtyeightyearold Turner astounded a U.S. State Department official who visited his cell to explain that the British had requested his arrest on possible charges of fraud in England. Fine time to find out Turner's age. After more than a decade of court cases, Turner was convicted in 1987 for running a Ponzi scheme. Eventually, the truth comes out. Koscot was founded in 1967. 0000001660 00000 n But the notion that you can fake it until you make it began to spread through multi-level marketing efforts such as Turners, where studies show few earn a profit and deception is rife. Glenn W. Turner is now all but forgotten. trailer Turner and his best friend, Edward G. Rector, were each sentenced to seven years in state prison. The guy at the top could make millions. "[7], According to one report target of prosecutors "in more than 30 states" targeted him. 0000010114 00000 n He seems to have been equal parts P. T. Barnum, Horatio Alger, snake oil salesman and evangelist. 84 F.T.C. /b+;*R2VL5 WC^ ;_>[AM "su`/d_w$3qhTGS;#m!bytBefF~s*GB9z\eBUK,nrEYXn u.$leJrk5@ NEWS RELEASE SUMMARYSeptember 1, 2021. 0000003297 00000 n Summary of this case from Great Western Bank & Trust v . Today, the phrase is also a way to push back on the feelings of self-doubt we call impostor syndrome, or to put forward an advantageous personal or professional confidence we might not entirely feel. 0000007782 00000 n The Dream, a podcast about multi-level marketing, discussed Holiday Magic and William Penn Patrick. In the lawsuit, Avon Products' claimed that "Holiday Magic employees distributed leaflets accusing Avon of goon squads, paying off The District attorney's office.."[7], In June 1973, the United States Securities and Exchange Commission filed a lawsuit against Holiday Magic,[8] charging Patrick with "bilking some 80,000 people out of more than $250 million through his Holiday Magic cosmetics and soap empire. On May 16, 1974, a compromise settlement with approximately 31,000 class members, establishing a trust fund worth $2,600,381, was approved by the court. (Free Speech issue - dismissed), Juice Plus AKA National Safety Associates, European Grouping of Marketing Professionals, https://en.wikipedia.org/w/index.php?title=Holiday_Magic&oldid=1140202664, Companies based in San Rafael, California, Short description is different from Wikidata, All Wikipedia articles needing clarification, Wikipedia articles needing clarification from March 2009, Creative Commons Attribution-ShareAlike License 3.0, Holiday Magic, Inc. v.
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