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A judge presiding over two competing class action suits against online travel company, YTB has asked lawyers in each of the two suits to find a way to consolidate the cases.

U.S. District Judge, G. Patrick Murphy told each of the sides last week that he would not hear two parallel cases simultaneously.”We’re not going to be hearing two cases at one time,” the judge said. “It makes a lot of sense to file one complaint.”

The lawyers in each case were given two weeks to come together to figure out a way to come together into one suit. If there is no agreement reached in that time, Judge Murphy will issue an order of his own choosing.

The two suits, one filed in California and one in Illinois are seeking a total of over $100 million dollars in damages stemming from claims that YTB was operating an illegal pyramid scheme and defrauded their independent consultants out of millions of dollars.

Now the lawyers from each case must come together and figure out a way to consolidate the two cases. Not only do they have to choose the fairest way to represent all of those involved, but they must also figure out who will represent the former YTB consultants. The lawyers have also begun to bicker over who will be lead counsel. Even when and if the suits are consolidated, the earliest the two cases will come to trial will be 2010.

YTB of course said that whether there is one suit or two, they will defend themselves vigorously against all charges Jonathan S. Quinn, just one of YTB’s lawyers, said, “The firm has done nothing wrong. The agents were trained to make money by working at home. They could sell travel-related services, such as airline fare, or recruit others to sell travel services. There were two different opportunities to earn money, both valid.”

Pre trial motions in the case will be heard just after the first of the year.

This has been a rough year for the embattled company that continues to try and put 2008 behind them. With recent horrible third quarter results and the sell off of assets, the year can’t end sooner.

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We told you recently about politician Burt Saunders, a Florida politician who is currently running for congress. Saunders is a member of the board of YTB, the direct sales travel company that has been under fire in recent months due to claims that they are running an illegal pyramid scheme. Now it seems that Saunders for some reason is not being completely honest about his involvement with the company.

When questioned about his role with the company, Saunders claimed this week that he has only been with the company since June. Record show however that he has been involved with the company since at least 2007 with financial records showing that he received thousands of dollars in 2007 as a paid consultant for the company.

Saunders has also claimed that he does not own any stock in the travel company. However, records from the Securities and Exchange Commission show that on May 23, a month after being elected to the Board of Directors, Saunders was awarded with over 24,000 shares of YTB stock. We have a copy of these records which you can see.  

These allegations bring even more suspicion to both YTB and Saunders. There is no word on how Saunders became involved with the Illinois based company, or how a politician felt it would be in his best interest to get involved in a seemingly illegal pyramid scheme type operation. While not all direct sales companies are bad, or illegal, had Saunders done any investigating into YTB, he would have seen that there have been several complaints lodged against the company to the Better Business Bureau.

If Saunders felt that he, and the company, had not participated in any underhanded activity, why would he, or the company feel compelled to be dishonest about their relationship. I’m sure eventually the truth will come out, and I can’t imagine that it will be good for either party.

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More questions keep coming up about DSA Member company YTB and whether or not the company is completely legit. Lawsuits have been filed, board members have resigned, and allegations have been flying for months now that the company, an online travel site, is running an illegal pyramid scheme. There has also been some talk about insider deals within the company.

Now comes word that amongst the members of the Board of Directors is Florida State Senator Burt Saunders, (R-Naples). Saunders serves on the Board of YTB International which operates YourTravelBiz.com.

Saunders, who is currently running for U.S. Congress has been paid in the past by the company to be its director and has received money as a consultant for the company. Financial documents show that he had received $16,000 dollars in 2007 from the company, no word yet on whether or not he has been paid for any services this year.

Currently YTB is facing two class action suits each asking for over $100 million dollars, with California asking for restitution for victims in that state. California’s Attorney General even went so far as to call YTB a pyramid scheme.

Saunders has yet to release any official statement regarding his current affiliation with the direct sales travel company, although he did say that the law suits were “silly.” In this day and age, when every politician’s life is looked into so deeply, this could have serious repercussions for Saunders if YTB is found to have operated an illegal pyramid scheme. I wouldn’t be surprised if Saunders is the next in line to step down from the board.

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In some strange news out of Florida, a University of Miami Business School Graduate, Andres Pimstein, has just confessed to running a sort of multi level marketing or ‘ponzi’ scheme in which he promised investors returns of up to 18% percent. Pimstein, and his company, Bottom Line of South Florida, apparently made false promises to many investors and lured them into giving him money. Pimstein then paid new investors with money from original investors, a classic pyramid scheme.

Apparently, Pimstein used school facilities, and computers as well as recruited faculty, staff and students . According to Miami Dade Police, Pimstein had a joint bank account with the university’s director of contract admission and was using a conference room along with as many as three dozen current and former UM employees.

It is estimated that the scheme managed to bilk investors out of an estimated $30 million dollars. One investor who gave Pimstein over $3 million dollars became skeptical when he wasn’t getting paid and hired a private detective who then uncovered the scheme. The FBI is currently looking into the whole operation.

The university said that they are fully aware of the investigation and that although University funds are not involved, there are a few employees who lost money in the scheme.

Pimstein was apparently very convincing luring lawyers, accountants, and even retired law enforcement officials. According to several investors, Pimstein presented detailed flow charts and fake invoices to potential investors detailing the future operations of the company, The Bottom Line of South Florida. Pimstein told them that they would be selling perfumes and electronics to Ripley, a large department store in Chile and Peru. According to reports, Bottom Line has no relationship with Ripley. I’m sure the full story will come out as the FBI continues to probe into the matter.

Pimstein had no comment.

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