Burnlounge is a Scam

Looking for People to Share their Burnlounge Experience

2006-09-07T15:50:00.000-07:00

David Jackson, who has a national podcast show called the Musicians Cooler wants to interview people about their Burnlounge experience. Their experiences can be good or bad. If interested email David at musicianscooler@gmail.com

Going to Burnlounge Corporate

2006-09-01T10:03:00.000-07:00

Burnlounge says "all visits to Burnlounge Corporate must be made by appointment only. With a growing family of tens of thousands of Burnlounge owners, it is impossible for our staff to accomodate drop-in visits. Your co-operation is very much appreciated and your support is necessary for Burnlounge to continue to bring you the best software and service possible."

My best guess: Burnlounge does not want to show anybody its empty offices and lack of employees. Maybe no one even works in the offices. So I ask if anyone has seen the Burnlounge Corporate office respond to this message and talk about it.

More Expert Advice that Burnlounge is a Scam

2006-07-17T14:48:00.000-07:00

Mr Jeffrey Babener is the leading legal authority and widely published author on direct sales, network marketing and MLM. He is also editor of the very informative web resource mlmlegal.com.

Some comments Mr. Babener has made:
Almost all states pyramid statutes prohibit the payment of an investment for the right to be involved in a multilevel type business. Many of the states specifically hold that the purchase of an "at cost" sales kit from a company is not considered to be an investment. Sales kits typically cost between $15 and $75. The term "at cost" means that the sale of the mandatory sales kit does not generate profit for the company. Profits for the company and its distributors should come from the sale of the company's products and services.

Q: Is it okay to pay commissions for recruiting new distributors?
A: Absolutely not! This is what is referred to as "head hunting" fees and is commonly referenced as an element of pyramid schemes in court cases. Commissions should be paid only on the sale of company product or services.

Q: If it sounds too good to be true, is it?
A: Yes!

After reading Mr. Babener's answers, there is more proof that Burnlounge is a scam. Burnlounge charges a high price to be involved in the company. Burnlounge also gives commissions for recruiting new members.

Burnlounge: Janglefish in a new name?

2006-07-15T15:23:00.000-07:00

After doing some research, I am almost sure Burnlounge is actually Janglefish with a new name. Janglefish was also a music MLM. But, Janglefish went out of business. Here is some interesting facts:

Janglefish orginated from two workers working at Excel Communications, and Burnlounge's CEO, Alex Arnold, was one of the heads there. Excel is another MLM with a suspicious past.

An old website called http://www.thejanglefishteam.com now forwards you to a Burnlounge store.

The two companies are almost identical in concepts. Click here to learn about Janglefis

Burnlounge's Suscpicious Literature

2006-07-13T15:45:00.001-07:00

You can check out Burnlounge's official literature here

You can check this forum for all the discrepancies that Burnlounge tries to hide in the small print.

Some things Burnlounge mentions in its fine print:

Affiliates and Moguls that have not accumulated Personal Volume of at least $100.00 in the year are not eligible for renewal.

Accordingly, Retailers must not produce their own literature, advertisements, sales aids and promotional materials, or Internet web pages.

Retailers are not permitted to develop their own web sites or web pages that promote, directly or indirectly, the BurnLounge opportunity or any BurnLounge products or services.

Neither federal nor state regulatory agencies or officials approve or endorse any direct selling companies or programs. Therefore, Retailers shall not represent or imply that BurnLounge or its Shared Compensation Program have been "approved," "endorsed" or otherwise sanctioned by any government agency.

Robert Lawrence FitzPatrick tells the truth of Burnlounge

2006-07-12T13:55:00.004-07:00

Robert Lawrence FitzPatrick, author of False Profits, website
FitzPatrick is an author, teacher, and internationally recognized authority in multi-level marketing schemes and pyramid sales fraud.

"Burnlounge is just a variation on many other similar schemes in which the product is merely a pretext for buying a position on the pyramid. No one will actually sell downloaded music to customers. All the buyers are investors in the scheme. The main money that will be siphoned up the pyramid is the price paid upfront by each new investor to get a position. The money from the downloads is minimal and would require a massive downline to profit from. The upfront payments, the lack of retail sales, and requirement for recruiting are all hallmarks of the pyramid scam masquerading as a business. Less than a small percentage of one percent would ever earn a real profit from this. They are the organizers and promoters."

Burnlounge is Pathetic

2006-07-12T11:43:00.000-07:00

To try to gain exposure Burnlounge has challenge its store owners to "immediately go to (their) 1.0 store and download 3 of (their) favorite albums. Right now!!!! If all 30,000 retailers bought 3 albums in the 30 days, BL becomes number 2 in digital sales nationwide."

Burnlounge is trying to make this illusion that the stores are actually selling music by having the owners of the stores buy music from their own store. That is pretty sleazy and pathetic.

Firsthand Experience in the Burnlounge Scam

2006-07-12T11:36:00.000-07:00

NOTE: this was not written by the founder of the blog, but rather by a reader.

I'm one of the many who were "in" BurnScam at the beginning and I am now very happily OUT of the very clear Ponzi scheme. (It took me 21 e-mails and threatened lawsuits and an e-mail exchange with an alleged Vice-Pres of the company to actually GET out ... but that's another story).

More people need to exposing this scam. You've got the right idea: nobody, and I mean nobody, is ever going to make money selling products; the only earning potential is through the chain-letter effect of scamming the suckers beneath you.

An idea: challenge anyone who finds your blog to show you their actual numbers. Good luck! I haven't seen a Burnmelounger yet who will do it!

Every single burnscammer has either 1) made no money at all, or 2) got in early enough and scammed enough of their friends and family to make some money working it like a chain letter - but none of them made money selling music.

By the way, before I got the hell out of this Ponzi scheme, I had 36 people beneath me (I got in all the way back in January). Of those 36, 35 had not even come close to making their money back. One guy, who I directly signed up, had worked his ass off for 6 months ... and made a grand total of $900. Minus the $440 'mogul + university.' Minus $14.95 per month. Minus all the money he spent going to Vegas and going to weekly meetings. In other words - he probably lost more money than anyone.

And of those 36 people, the entire downline sold less than FIVE DOLLARS worth of music. In six months.

Keep preaching the truth, brother. Maybe you'll spare a few suckers from wasting their time and energy.

Check this site if you haven't seen it:

http://burnlounge.proboards92.com

Burnlounge is a Ponzi's Scheme.

2006-07-12T08:13:00.000-07:00

Economist says Burnlounge looks to be a Ponzi's Scheme. A professor from a very prominent university has looked at Burnlounge's site and has decided that this scheme is likely to be a Ponzi's Scheme.

Burnlounge: Behind the Music

2006-07-11T10:28:00.000-07:00

We finally got our new “Make it Rich” scheme, and it is called Burnlounge. According to Burnlounge.com, “Burnlounge is the world’s first community-based digital download service.” Basically Burnlounge is like an iTunes, except instead of having one store selling music, there are thousands of different stores, all selling the same music. For a fee, someone will be able to open up his/her music store and start making a profit selling music. But, it even gets better! If a person signs someone else, he/she earns a bonus. Also, a person earns profit from people that person signs up, and music sales from people below them. So in simple terms: it is a pyramid scheme or more specifically a Mutli-Level Marketing, MLM.

So how is this considered legal? Because there is a product involved, the music. The music is the backbone in making this little scheme look legitimate. Hypothetically, someone could make a successful business selling music on its store’s website. However, the problem comes with finding your customers. Who will actually buy your music? For one thing, every store sells the exact product, or in economic terms it is a perfect competition. Are you going to be able to persuade some Joe to buy Ashlee Simpson at your store when he could choose to buy it at one of the other 35,000 plus stores on Burnlounge? Not likely. This does not even include the iTunes factor. Most people buy from iTunes directly because songs can go directly to their ipods. As of now, the music from Burnlounge is not formatted to go on an ipod. And both products are 99 cents. That leaves a “really” tough decision for the consumer. In the age where ipods dominate, music not formatted for ipods are as useless as a winter jacket in Miami. So who are your customers? Most likely friends and families, and you the owner.

So where does the money come from? Signing up other people. Your revenue comes from getting other people to fall for this scheme, and then these people to get other people to fall for the scheme. So in reality you really are never selling music. You are selling these “stores” to other people looking to make an easy profit. According to the definition Multi-Level Marketing, a MLM is only legit when commissions are earned only on sales of the company's products. No money may be earned from recruiting alone (Wikipedia). Mary Kay is an example of a legitimate MLM. Mary Kay employees only earn commissions on its sells and its team sells, not by signing up people (Wikipedia).

So all profit come from basically scamming someone into buying something. But what about all those people making profits? Yes, many people have made a profit off this little scam. However, this profit has all been by scamming others. So people will get rich, but many will not. In a pyramid, there are very few on top, but many at the bottom. You may have a friend trying to get you to join this great opportunity. Of course he is, he is trying to make some money. Your friend knows he is not going to make any money selling music, unless his wife wants to download all of Madonna’s songs. Your friend may even entice you about all the profit he made. Trust me, your friend is not lying, he made a profit, but mostly because of idiots like you. And after scamming you off, you will now carry the burden of having to find other idiots to scam. So for those who don’t have a conscience this is indeed a great way to make money. But, just like any pyramid, there is a bottom. And those are the ones who will be the biggest losers.

Imagine if I had a coconut store, and I decided to franchise out my coconut store. Let’s say that I sell my coconut stores for one hundred dollars and I find five people. I tell those five people they now are able to franchise coconut stores out to people, and I will give them a portion of the profits. This continues many times. All of the coconut stores selling the exact same coconuts. I, who am at top of the pyramid, am making loads of money even though I have yet to sell a coconut. Now let us say that I found out that all the coconuts in my franchises are poisonous. Would this affect revenue? Not at all, because no one is even buying a coconut. This is exactly the same scheme the founders of Burnlounge have done. These founders are the true winners. They are making tons of money, while you, the person driven by greed, are busy scamming your friends and families.

Did anyone ever ask the question, “Why didn’t the founders of Burnlounge sell the music straight to the customer?” The people behind Burnlounge like to tell their customers that they want to give the public access to sell music and opportunity to make money instead of having big companies such as Apple reap all the benefits. The truth, however, is that they make more money selling these “stores” to people like you, and do far less working than trying to sell the music. Because who is Burnlounge’s number one advertiser? You, the person trying to recruit innocent people to scam. The heads, CEOs, whoever is behind Burnlounge does not need to work hard to find customers because they know people’s greed will lead them to Burnlounge.

The old saying goes, “If it seems too good to be true, then it is” is exactly the moral to my story. Everybody is trying to look for an easy dollar. It is our natural instincts as humans to follow greed. That greed leads millions of people to stupid schemes every year. Yes, I understand some people do make a profit with Burnlounge. Those people are the ones who are able to scam many people. And the big winners are the ones who are able to scam lots and lots of people. But at the end of the day, you have to be able to look at yourself in the mirror. For some, they have no conscience. They fail to care about the many who have lost money because they are too busy counting their own. However, I like to pride myself as an ethical man. And I don’t think a few hundred or thousands dollars is worth having the inability to look yourself in the mirror. And worst yet: losing all your friends and families whom you have scammed.