Stoops / BurnLounge thingy

[CincySooner]

Stoops is mentioned on the outer fringes of this article. Its some kind of pyramid scheme for a company I've never heard of.

I don't know the first thing about these things, are they illegal or what? It looks like Spurrier Jr. is in the thick of it.

http://www.thestate.com/426/story/94186.html

I dont really know what to make of it. Can anyone explain?

[OnlyOneOklahoma]

probably is nothing :pop:

[Scott D]

At this point the only people who would be looking at trouble would be Rob DeBoer, and perhaps Todd Ellis.

It's hard to point a finger at someone who is an investor and claim that they were in on knowing something was any sort of pyramid scheme.

The moral of the story however is if you get approached to invest in something by a former South Carolina player, say no then walk away.

[BermudaSooner]

Stoops is mentioned on the outer fringes of this article. Its some kind of pyramid scheme for a company I've never heard of.

I don't know the first thing about these things, are they illegal or what? It looks like Spurrier Jr. is in the thick of it.

http://www.thestate.com/426/story/94186.html

I dont really know what to make of it. Can anyone explain?


pyramid schemes aren't necessarily illegal--one of the biggest in the nation, Amway, has made many people fairly wealthy. In Amway, you sell soap, and then get other people beneath you to sell soap, who get other people beneath them to sell soap. When you get a big network of people below you selling soap, you make good cash.

The problem arises from the original pyramid schemes where there was no soap. Essentially, you got people to "buy a franchise." Then they get people to buy a franchise. The franchise fee went to people above them. Much like the chain letters you probably got in the 80's where you put your name on the bottom of the list, send it off to 25 people, and send $1 to everyone above you on the list. Essentially the process become unsustainable as at some point the whole population of the world becomes involved.

It is hard to tell from the article, but this looks close to a combination of the two. Trying to use the sales of music online as the soap--but still heavy reliance on the pyramid aspect. If it is really all about selling the franchises, this could be a problem for some involved.

[yermom]

i think pyramid schemes are illegal, it's multi-level marketing that's not

it may be a bad idea, but not illegal ;)

someone like Stoops could probably make some jack with something like Amway... he's probably just trying to get in on something like his wife's Mary Kay :D

[soonerinabilene]

pyramid schemes aren't necessarily illegal--one of the biggest in the nation, Amway, has made many people fairly wealthy. In Amway, you sell soap, and then get other people beneath you to sell soap, who get other people beneath them to sell soap. When you get a big network of people below you selling soap, you make good cash.

The problem arises from the original pyramid schemes where there was no soap. Essentially, you got people to "buy a franchise." Then they get people to buy a franchise. The franchise fee went to people above them. Much like the chain letters you probably got in the 80's where you put your name on the bottom of the list, send it off to 25 people, and send $1 to everyone above you on the list. Essentially the process become unsustainable as at some point the whole population of the world becomes involved.

It is hard to tell from the article, but this looks close to a combination of the two. Trying to use the sales of music online as the soap--but still heavy reliance on the pyramid aspect. If it is really all about selling the franchises, this could be a problem for some involved.

I remember something like that with baseball cards. You send a guy to packs of cards, then mail that letter to 20 people, and you receive two packs from those 20 people, so you would get 40 packs for the price of 2 or something like that. Never got a d$^ned thing though.

[85Sooner]

Stoops linked to alleged scheme



By Randy Ellis
Staff Writer
University of Oklahoma football coach Bob Stoops confirmed Monday he invested in an online digital music business that federal regulators now allege is an illegal pyramid scheme.


"Even though this investment was less than $500, like all others I make, it was reviewed by a trusted and experienced group of legal and financial advisers,” Stoops said Monday in a statement released by OU. "I have been and remain comfortable with the direction they have provided for many years.”

Kenny Mossman, OU associate athletics director, said Stoops did not say how much money he made off the investment or whether he recruited other coaches or players to participate.

The Federal Trade Commission filed a complaint June 6 alleging that BurnLounge Inc. is operated as an illegal pyramid scheme.

FTC attorneys said BurnLounge touted the participation of major music and sports celebrities such as singer Justin Timberlake and professional basketball star Shaquille O'Neal as validation of its offerings.

Stoops is not named as a defendant in the FTC lawsuit against BurnLounge, but his name surfaced Sunday when a Columbia, S.C., newspaper quoted former OU receivers coach Steve Spurrier Jr. as saying he invested in BurnLounge a year ago after Stoops introduced him to the concept.

"When Bob Stoops got me, he said, ‘I've spoken to a lawyer about this. I've spoken to my agent. I've spoken to some people to find out if this is a legitimate thing. And everything they told me, this is a legitimate (business). Put your name on it and go do it,' ” said Spurrier Jr., who is now a receivers coach for the University of South Carolina Gamecocks.

Stoops declined to comment on Spurrier's remarks, referring questions to Mossman.

BurnLounge was not promoted on OU Web sites, Stoops and Mossman said.

BurnLounge touted itself as possessing software that would let participants open their own digital download stores and sell music to online friends. The FTC alleges it was operated as an illegal pyramid scheme, with participants at the top of the pyramid making money by recruiting new participants who would pay fees to open stores.

BurnLounge announced Monday that its chief executive officer had resigned and a replacement had been appointed.

In a statement on its Web site, BurnLounge has said: "BurnLounge is working with retailers, investors and partners to ensure that our business continues uninterrupted. The founders of this company are working with the FTC to try and resolve any issues and address any concerns that the FTC has with this industry or our business.”

Contributing: Nolan Clay and Brian Sandalow, Staff Writers:mad:

[birddog]

i just said to myself 5 seconds ago.." i hope no one starts a thread about this crap."

[cs6000]

Does this mean its too late to get in on deal?

[OnlyOneOklahoma]

i just said to myself 5 seconds ago.." i hope no one starts a thread about this crap."

same here

[Boomer.....]

out.

[r5TPsooner]

I need better investment options like a pyramid scheme.

[OklahomaTuba]

Less than $500?

Sounds like Bobby needs a raise.

[RacerX]

Sorry you don't have enough cash Bob.

Try Amway.

[The_Red_Patriot]

Stupid Bob, Stupid

[Tear Down This Wall]

It's good to see Bob Stoops investing in serious stuff. He has great advisors, obviously. Maybe we're not paying him enough. Or, maybe his wife's very successful, legitimate business isn't bringing in enough money for Bob to play the stock market on the side.

[yermom]

$500 to Bob Stoops is like a quarter to me

this is kinda embarrassing, but i can't imagine there are any legal problems

[sooner518]

link to their site and FAQ about this...
http://corp.burnlounge.com/default/press_articles/ftcFaq.html

[Ash]

Another stupid *** non-story to stir things up during the off-season.

If his advisors are giving him the OK and he flips chump change at it, how is it reflected on him other than he needs new advisors. Someone knows they can make a headline here by putting Stoops name on an "article" that would otherwise get buried.

Unless Stoops founded the freakin' company, who cares?

[Ash]

By the way, Bob Barry Jr. also gave money to these guys...maybe there should be an investigation of the Barry family!!!!

[Scott D]

Another reason that terrible coach bob stoops should be fired immediately

[Tulsa_Fireman]

maybe there should be an investigation of the Barry family!!!!

How does investigating how Bob Barry Jr. is a tool gonna tell us anything about Bob Barry Jr. investing in a pyramid scheme?

Oh, my bad.

Since you mentioned Junior, I automatically thought you was referencing his mighty tool-ness.

[Big Red Ron]

out.Yet, somehow, in.

[Sooner-N-KS]

There are no legal problems for Stoops here in my opinion. For me though it does seem to indicate bad judgement.

Even if Burnlounge is determined to be 100% OK, I think it's bad PR. MLM's can be OK, but it gives many people a bad taste in their mouths when they are around it....right or wrong that's the reality of it. Much of the coach's job is PR, and an MLM on the side when he makes millions a year coaching isn't good PR.

I understand that his wife does Mary Kay, and that's fine. Mary Kay has probably the best image of the MLM's, and she's not the head coach of Oklahoma football.

[Soonerfan88]

Maybe he just wanted to use the service for himself and wasn't truly promoting it to anyone? If he downloads a lot of music it may be a convenience and is used regularly.

And from the info I've seen, there are many coaches/athletes involved so why was Stoops the only one singled out (other that SS Jr who ratted out BS)?

[yermom]

he was recruiting other people (SS Jr) so it's not like he was just using it

but still, it's not like he started the company or something, or dictated how it was set up

[SoonerLB]

Who among us doesn't tell a few close friends when you run across something that has the possibility of being a good investment? It's human nature for crying out loud.
Penis head......er, Jime Rome, was spewing about this today, so that alone makes it a NOT WORTY topic of discussion as far as I'm concerned.
Hot and muggy out today, wasn't it? ;)

[Ash]

he was recruiting other people (SS Jr) so it's not like he was just using it

but still, it's not like he started the company or something, or dictated how it was set up

IMHO, this is the embarassing part of the story for Stoops.


And from the info I've seen, there are many coaches/athletes involved so why was Stoops the only one singled out (other that SS Jr who ratted out BS)?

It's big news when Bob Stoops does anything or anything happens with the OU football team apparently. If SUC's coach were in this it would probably be the same.

It does suck, though, that of all the potential parties involved, Stoops name is getting dragged in the mud. And people wonder why some Sooner fans feel like it's us against the world.

[RedstickSooner]

Damn. What kinda lawyer does Bob have, where it makes financial sense for the dude to analyze an investment that Bob's gonna put less than $500 into?

"Gee, Bob, I've run the numbers, and I think you *should* bankroll your daughter's lemonade stand. You could easily pull 50% profits, or better, depending on the humidity and traffic flow in your neighborhood. Let's meet later in the week, and hammer out your business plan. Are you still set on a card table, or are you going to go with one of those portable dining room tables?"

[okienole3]

Damn. What kinda lawyer does Bob have, where it makes financial sense for the dude to analyze an investment that Bob's gonna put less than $500 into?

"Gee, Bob, I've run the numbers, and I think you *should* bankroll your daughter's lemonade stand. You could easily pull 50% profits, or better, depending on the humidity and traffic flow in your neighborhood. Let's meet later in the week, and hammer out your business plan. Are you still set on a card table, or are you going to go with one of those portable dining room tables?"


It makes sense because of situations like this.

[2k2 c5]

I don't know the first thing about these things, are they illegal or what? It looks like Spurrier Jr. is in the thick of it.

I dont really know what to make of it. Can anyone explain?

As I investigate these things for a living, pyramid schemes by definition are illegal. You pay to play and you depend on the efforts of others outside your control to continue the program and make money. Just gambling with camo. Generally, however, the promoters are the proposed defendants and the investors are on the victim list. No sweat for Bob. I do however, question the wisdom of an adviser who can't see past the smoke and mirrors.

[stoopified]

Much ado about bothing......,I hope.