"Zer01 Mobile CEO Addresses Scam, Vaporware Allegations"
CEO Ben Piilani basically threw Global Verge and Buzzirk under the bus this week with this latest article. I'd like to dissect parts of this articled and tell you what Mr. Piilani is really saying indirectly.
The first question that was asked by the reporter was:
"What do you say to those who claim that Zer01 isn’t legit?"
Ben Piilani's response was:
"One of the companies that we signed on with, just as a distributor on a contractual basis was Mobile Verge. We didn’t meet them until after CTIA in May when they came to us. We weren’t even considering multi-level marketing until they came to us. They pitched us on the idea that—even though I’m not familiar with multi-level marketing verticals, and I’ve never been a fan myself—they pitched me on the idea that it’s a lucrative market that shouldn’t be overlooked.
And they mentioned that they’ve worked with successful companies such as Amway where they’ve had successful models. We created that vertical specifically to work with Buzzirk in May. Again, it was only contractual as far as them becoming a distributor under that vertical.
I guess in the past 10 or 11 days we discovered there was some murky past with Mark Petschel the CEO and he was convicted of securities fraud. So I contacted him and he explained to me the situation and he basically –long story short–he did get convicted of securities fraud. So we asked Mobile Verge to remove him as the CEO and so currently he just resigned as the CEO."
In other words, Mr. Piilani is saying:
"I din't realize that the guys at Global Verge and Buzzirk would screw things up as bad as they did. Had I known that this would have become such a disaster I would have never contracted them to be our main distribution channel. I can't be held responsible for their actions since I din't really know that much about the network marketing/mlm industry."
If the product could have stood on it's own, why go the MLM route. Why not go to Best Buy, Wal-Mart, Radio Shack, and Target, for a distributorship. These companies already have millions of pre-existing customers that would have jumped at the opportunity to have bought one of these phones.
Second question:
Who is Buzzirk?Mr. Piilani answered:
"......Basically, Buzzirk is just a brand and they are going to sell that brand to multi-level marketing. Again, it’s just a distribution agreement; we don’t own any part of them and they don’t own any part of us. They came and signed on as a distributor under one of our verticals and they aren’t the only one we’re working with.
We were going to push the product through them as “Powered by Zer01.” They were originally going to launch in their agent network before on the public side. Then all of other stuff happened so we demanded they get it cleaned up before we start moving the product"
In other words: "The ship is going down like the Titanic, and if there are going to be any criminal investigations, or law suits it should be geared towards the Buzzirk guys, since they are the ones that mucked this up. We don't control anything they do. You could almost say they are a completely separate company from us, and we are not going down with them."
This is shameful Mr. Piilani. The captain always goes down with the sinking ship. Please don't try to bring the 50,000+ distributors down with you, or worse yet, shift the blame for all the negative publicity to them.
Third question:
"Why partner with a company like Global Verge marketing? We listened to the marketing pitch, and to an everyday Joe Consumer, that sounds like a Pyramid Scheme through and through, with promises like “$29,000 a month,” “a WiMax phone,” phones from “science fiction movies.” That sounds like a scam to us."Mr. Piilani:
"None of that came through our compliance. What happened was [[Buzzirk’s]] base grew too fast I guess and they didn’t have their compliance in place and so their agents… it’s one of those things you tell one person and by the time it gets down the chain it’s a totally different story. And they just started marketing that stuff. So according to our agreement they weren’t allowed to put out any public materials without passing it through us first. They didn’t have control over their associates at that time. They just signed in a new compliance officer. I can’t make a whole lot of comments about that company because they are completely separate from us. I’m just making comments on what I do know."
In other words:
"These guys are abunch of bafoons that started pedding this product without our knowledge. We din't realize that they took our product (if they even have one), which is nothing more than just an expensive pre-paid wireless plan like Boost Mobile, and made it into something that you would see out of a Star Trek movie. Boy these guys (Buzzirk Mobile Distributors) have ruined our reputation so much, that we won't be able to bring the product to market."
Fourth Question:
"Do you worry that Global Verge and Buzzirk are going to ruin your name before your product even hits the market?"
Mr. Piilani answered:
"Absolutely. At the time we didn’t realize there was going to be a compliance issue and that it was going to get out of hand. In 2 weeks it went completely out of hand on their side. We’re pretty much completely helpless from our standpoint. The only thing there is to do now is tell them to clean up and get their compliance together. When we first started with them it wasn’t that we were intending on doing anything like this. For now we’ll deal with the aftermath and try to clean it up. Obviously, this was a new thing for us too, multilevel marketing. It was unconventional. It made sense at the time."
Wrong answer. The right answer should have been:
"Absolutely NOT!!! This product is going to be so revolutionary that it really doesn't matter what kind of negative publicity we get in pre-launch, when this comes out it will revolutionize the telecom industry. I advise all the "nay-sayers" to just watch and see what happens when we bring this product to market! No worries here!"
Fifth question:
Can you cut your ties with Global Verge?
Mr. Piilani says:
"We could completely sever our relationship with them but I don’t see how that would do any good. It would cause even more bad to come out. The best thing we can do with them is get their compliance in place and get it all cleaned up. And then get phones in their hands and have them out on the market."
You don't bite the hand that feeds you. Saying that you could sever your relationship at any time doesn't do much for the moral of nearly 50,000 people that have joined this company. Again, another example of throwing Buzzirk under the bus.
Sixth Question:
Do you have any rules in place requiring them to get rid of these bogus claims?
Mr. Piilani says:
"Yes we do. They have an ultimatum to shut down these sites and only post approved, messages. If not they’ll be removed as an associate. At this point I don’t know how quickly they are going to be able to clean it up. Obviously, there are individual sites out there. A compliance e-mail has to go out to all of their associates."
This is a CYB (Cover Your Butt) statement. Let's tell them that they can't make claims on their websites, and if this gets shut down by the feds, we can say "well we tried to tell them to stop their junk, but they wouldn't listen to us." Nice job protecting your sales force.
Seventh question:
Mr. Piilani says:
Does Zer01 have a patent for its technology?
"We are patent pending right now issued through the Patent Trademark Office."
[[Note: Zer01 spokesperson Ron Dresner says the pending patent number is US 61/149,871 under the Unified Technologies Group name.]]
No such trademark or patent exists!! Check for yourself.
Folks I am all for network marketing/mlm companies, and I am a big recruiter myself, but this is one I would stay away from. See http://www.90recruitsin90days.com for more helpful recruiting techniques.
