Dates of Herbalife Distributorship: 2000s – present
Status in Herbalife: President’s Team
Business Methods: Training and Presentations, Online Recruiting Businesses
All statements in the report are made pursuant to Pershing Square’s disclaimer available at www.factsaboutherbalife.com.
Background on Herbalife-Related Businesses
- Russell Gain owned and operated a business called 60 Minute Money through his company Laurent Trust Ltd. The business was hosted on the website www.investinyourfuture.org, among others, which is registered to Gain and lists Laurent Trust (LT) Ltd. as the “Admin Organization” (domain registration attached as Gain Exhibit A). See also http://web.archive.org/web/20071117021556/http:/60minmoney.net/terms_conditions.php?region=au (references Laurent Trust as the owner of the 60 Minute Money website). The domain registration uses the address HLB Nathans House, Christchurch Square, Dublin 8, Ireland, and lists Gain’s email address as email@example.com. The website is no longer active, but can be viewed at http://web.archive.org/web/20060203115738/http://investinyourfuture.org/.
- Other domains that were associated with 60 Minute Money, but are no longer active, include: www.sixtyminutemoney.org (see Gain Exhibit B); www.60mmdemo.com (see Gain Exhibit C infra); www.xtraedollars.com (see Gain Exhibit D infra).
- Other domains attributed to the email address listed for Gain in Gain Exhibit A—firstname.lastname@example.org—include: www.battlingtheweight.org; www.health-smart.org; www.success-4u-from-home.com; www.wealth-4-u.org. See Gain Exhibit B.
Primary Source Data on Business Practices
- 60 Minute Money sought to recruit new Herbalife distributors by offering a “foolproof” system for achieving “a better financial future” working from home.
- Telling visitors to his 60 Minute Money website that they “can secure a better financial future today!”, Gain sought to convince Herbalife recruits that he can help them “Start [Their] Own Foolproof Home-Based Business.” See Gain Exhibit C for a screenshot, also available at http://web.archive.org/web/20071117023931/http://60mmdemo.com/. Gain declared that his “proven step-by-step system” can teach new recruits how to make up to “$2,500/month part time” or “$5,000 or more per month” full time. He further explained the ease with which one can become a successful Herbalife distributor, noting that his “turnkey system is so simple that even if you are an Internet beginner, you can be successful. . . . Success is possible for anyone with our program.”
- In another iteration of the 60 Minute Money website, hosted on now-defunct www.xtraedollars.com, Gain continued his use of exaggerated income claims, telling potential recruits he has “developed a multi-million dollar business now generating sales at an annualized rate of over $5 million all from my home” and that “[p]eople from all over the world now participate in [the 60 Minute Money] program and are building similar businesses for themselves from their home.” See Gain Gain Exhibit D for a screenshot, also available at http://web.archive.org/web/20020525064944/http://www.xtraedollars.com/.
- Gain then noted that, “Not only will you get the inside scoop from [people successfully using the 60 minute money program], but you can also see copies of some of the checks they earn each month on this website. In a version of the site from May 2009, Gain displayed checks purportedly belonging to 60 Minute Money members.
- In a later version of the Xtraedollars site, Gain sought to persuade individuals who have been recently laid off to “Take Control of [Their] Destiny” and “get excited” because they “have the ideal opportunity to take action right now” by using Gain’s 60 Minute Money system to become an Herbalife distributor. See Gain Gain Exhibit E for a screenshot, also available at http://web.archive.org/web/20031011235140/http://xtraedollars.com/. The site included a quote from Gain’s wife, Donna, in which she described the alleged financial freedom that this business opportunity affords, noting that “[i]f you have children, its [sic] an added benefit to be at home with them after school and not leave their care in the hands of other people.”
- The Terms & Conditions for 60 Minute Money, available at http://web.archive.org/web/20071117021556/http:/60minmoney.net/terms_conditions.php?region=au, told the reader not to “be misled by claims that high earnings are easily achieved” despite Gain’s misleading statement, on the website’s homepage, that his “turnkey system is so simple that even if you are an Internet beginner, you can be successful” (see infra).
- Gain’s 60 Minute Money business did considerable damage to consumers. Two consumer complaints about 60 Minute Money, available at http://www.cockeyed.com/workfromhome/epilogue/unsuccessful/unsuccessful2005_5.html, describe Gain’s deceptive business practices:
- In one complaint, dated March 19, 2005, a self-described member of Herbalife’s Global Expansion Team (GET), Rob Phillips, says that, “Two years ago I fell for the Herbalife opportunity. This was a group, now as large as David Beven [sic], called 60 Minute Money, run from South Florida, initiated a few years ago by Russell Gain . . . .” Phillips notes that 60 Minute Money is, in fact, an Herbalife business, despite its lack of Herbalife branding. “This is a further scam to conceal the fact it’s Herbalife.” Phillips continues, stating, “I was conned all the way, and now both my wife and I are ill, and splitting up because of the pressure. It’s fine until the investment money runs out, then you are left to rot. . . . Please look into this organisation and warn people they need $200,000 minimum to make it work.”
- In a second complaint, dated March 22, 2005, Howard from Yorkshire, U.K., explains that, notwithstanding the lack of Herbalife branding on Gains’ website, 60 Minute Money is merely an Herbalife recruiting business that attempts to persuade recruits to purchase Herbalife products at a cost significantly greater than what those products sell for on the open market. Howard says, “I came across the 60 minute business from a work at home link and parted with £27 for the cd. I worked through all the testimonials and recognised the signs ( If it looks too good to be true, it always is). When after spending a couple of hours of listening to Russel [sic] Gain’s amateurish presentation, I finally got the confirmation thrugh [sic] the link to ‘View our products’ and Herbalife was a [sic] revealed. What? I’ve wasted my time & money to find that it’s the same tired old crap. I had hoped it was something new and exiting [sic]. The first product I checked out was Glucosamine Sulphate, available anywhere at afraction [sic] of the price they charge. No wonder they say that 78% of the price is paid out in commissions.”
Links to Other Senior Distributors
- Russell Gain frequently appears at Herbalife-sponsored events with other senior Herbalife distributors.
Gain with President’s Team member Ben Cole (left). See https://www.facebook.com/photo.php?fbid=295638003883534.
Gain (right) with Chairman’s Club member Blake Morgan (left) at the Herbalife Extravaganza in Cologne, Germany, in 2013. See http://www.herbalifephotos.com/Extravaganza/2013-EMEA-Cologne/Day-2-Qual-Great-Gatsby-Party/i-P4dBrqD.
Gain (left) with Chairman’s Club member Martin Ernst (right) at the Herbalife Extravaganza in Cologne, Germany, in 2013. See http://www.herbalifephotos.com/Extravaganza/2013-EMEA-Cologne/Pres-Team-Dinner/i-3BVgt6b#!/Extravaganza/2013-EMEA-Cologne/Pres-Team-Dinner/i-XxvhCJv.
- Gain is seen particularly often at Herbalife-sponsored events with Chairman’s Club members David Bevan and Jane Clark.
Gain with Bevan (standing second from right).
Gain with Bevan at the Herbalife Extravaganza in Cologne, Germany, in 2013. See http://www.herbalifephotos.com/Extravaganza/2013-EMEA-Cologne/Day-1-AWT-Training/i-5DqmShj#!/Extravaganza/2013-EMEA-Cologne/Day-1-AWT-Training/i-mQz7bzX.
Gain with Clark at the President’s Team Dinner at Herbalife’s Extravaganza in Cologne, Germany, in 2013. See http://www.herbalifephotos.com/Extravaganza/2013-EMEA-Cologne/Pres-Team-Dinner/i-3BVgt6b#!/Extravaganza/2013-EMEA-Cologne/Pres-Team-Dinner/i-3BVgt6b at photograph 36.
Links to Herbalife Corporate Leadership
- Gain was mentioned in Herbalife Today, a magazine published by Herbalife, in 2011 for his work, alongside David Bevan, in promoting Herbalife’s QuickSpark product in the United Kingdom and Ireland.
- Gain was featured in a 2005 pitch book produced by Herbalife for new recruits, attached as Gain Exhibit F at 26, for living “a dream lifestyle” due to his Herbalife business. Gain says, “I’ve achieved tremendous success and my business has expanded to four continents. My wife and I now live in a gorgeous home on the Intercoastal Waterway in Florida. We live a dream lifestyle, we shop whenever we want, we never have to worry about unpaid bills, and we have an office that overlooks a lap pool right beside the ocean.”
- Gain was a speaker at Herbalife’s U.K. & Ireland Leadership Team Meeting in 2013.
- Gain was a speaker at the Herbalife Extravaganza in Cologne, Germany, in 2013.
- Gain was also guest speaker at a training event in South Africa in January 2014 for distributors learning how to coordinate Herbalife “Level 10” weight loss campaigns.
These businesses may present additional avenues for investigation.
- On his LinkedIn website, screenshot attached as Gain Exhibit G and available at http://webcache.googleusercontent.com/search?q=cache:JvjBAuNX06QJ:sg.linkedin.com/in/russellgain+&cd=6&hl=en&ct=clnk&gl=us, Gain lists two businesses under the title of “Founder.” According to Gain’s LinkedIn site:
- Click2Connect is a “local search engine with a social emphasis” for “business directory searches.” Gain lists October 2008 – Present for dates of the business’ existence. Click2Connect also has a Facebook website, available at https://www.facebook.com/Clicktwoconnect.
- GoGo Technology helps people arrange their “files, communications, events and tasks in a relationship sensitive context.” Gain lists January 2007 to present for dates of the business’ existence.