MS BRENDA WETERE'S EVIDENCE
76 As I have mentioned, none of the respondents gave evidence. They did, however, call one witness, Ms Brenda Wetere. Ms Wetere did not make an affidavit or statement but I permitted the respondents to call Ms Wetere anyway and her evidence was given on the voir dire to enable the ACCC to consider its position. Ultimately, the ACCC took no objection to Ms Wetere's evidence and it was received as evidence in the respondents' case. Ms Wetere was then cross-examined. In addition, the ACCC called evidence in reply which addressed aspects of Ms Wetere's evidence.
77 Ms Wetere's evidence is particularly significant not only because it is the only evidence given by a genuine member of TVI Express but also because it is evidence from someone who appears to have been quite successful in recruiting other members.
78 Ms Wetere described herself as a "multi-level marketer" who has achieved the rank of International Diamond in the TVI Express System. She first joined TVI Express in February 2010 as a result of a presentation made to her by Ms Brownlee to whom Ms Wetere paid a $330 joining fee. This presentation was conducted by Ms Brownlee by reference to the TVI Express Power Point that I previously described.
79 Ms Wetere was asked about Ms Brownlee's presentation. She gave the following evidence:
When I saw this presentation initially, I thought it was definitely value for money, as I had been in other network marketing companies and they had been more expensive, and this seemed a better opportunity for myself and my family at the time.
[A]s a family, we had always wanted to travel. I had never been off - I was born on Norfolk Island, so I'd only ever been to Norfolk Island, New Zealand, and Australia. So my motivation for joining network marketing companies since 1985 was primarily for a residual income and to travel. So the main purpose of the business that appealed to me was travel and to earn an income.
Asked what benefit came with membership of TVI Express Ms Wetere explained:
My understanding on joining with what that membership gave me was a travel voucher, a back office, which allowed me to promote the business, and also have my own travel portal, which would allow me to redeem my travel voucher for my seven nights, eight days' accommodation. I will be able to log into my back office and redeem that voucher. It would also give me information on how to build the business, because that's what I have paid for, access to my back office, and it will also give me promotional tools on how to build the business, which, of course, the presentation is in our back office that we could print out.
80 Ms Wetere gave evidence that she had "exited the Express Board" seven times thereby earning $70,000 (excluding residual income). She also explained that while Ms Brownlee, as her introducing member, was higher up the line than Ms Wetere, she had out earned Ms Brownlee.
81 Ms Wetere also gave evidence that she received an invoice dated 24 February 2010 from TVI Express. A copy of the document is in evidence. It appears to have been issued to Ms Wetere by TVI Express Limited of Limassol, Cyprus. The invoice shows that an amount of $275.00 was paid for a single TVI Express membership. Ms Wetere's membership ID is also shown on the invoice. I infer that this was provided to her by Ms Brownlee on behalf of TVI Express.
82 Ms Wetere was asked in her evidence in chief what she understood she was getting in return for her payment. She gave this evidence:
What I understood when I was - after I paid my money, that I would get an official receipt from TVI for my tax purposes, because it is - to me, I understood that it would be a business like the other multi-level marketing businesses that I had joined previously and always paid my taxes on. So I treated this exactly the same from word go, and I would get an official receipt from TVI, which, your Honour, you have now.
…
So I would get that, I would receive my travel voucher which would entitle me to the benefits of my accommodation which my family and myself could enjoy, and of course, I would get a back office which I would be able to join members through and be able to promote and run my own business.
83 Asked what other benefits she thought she was receiving from her membership in TVI Express, Ms Wetere gave the following evidence:
What other benefits have you derived? --- From the business itself?
Yes? --- Of course financial benefits. I've gone from also paying a bill off at $200 a week to be able to now pay my bills on time, and I don't take that lightly. I don't say that I wasn't a hard worker before because I definitely was, but I also have worked hard in this business. I live on four to five hours' sleep a night, so I have worked this business hard, day and night, to earn the income that I've received.
Are there any other benefits? --- Definitely meeting the different people. I have a lot of different nationalities in my business, and of course, being able to help a lot of people get out of the financial rut that they're also in and give them hope and dreams. We have a lot of people that are on the dole that have been able to save the money and join this business because it's affordable for them to join, and also earn the income, and like I gave my own evidence, that I was on workers comp, and once you tick the box that you've been on workers comp before, although they're not supposed to discriminate against you, they also don't want to use you, you being a liability for their company and they won't employ you. So this has also given a couple of people who have been on workers comp the opportunity to take charge and make money and travel also.
She also explained that her husband was a bus driver, that it was always his goal to be able to "get on planes", and that TVI Express gave him the opportunity to do this. While the evidence indicates that he is also a member of TVI Express it does not disclose how much income he has derived through his membership.
84 As to Ms Wetere's desire to travel, it is useful to look at the testimonial which I infer she provided to Ms Brownlee for inclusion on Ms Brownlee's website. It indicates how exciting Ms Wetere found the TVI Express business and how much money she was making from it. Nothing at all is said by her in her testimonial about any travel related benefits or opportunities associated with her membership.
85 Ms Wetere gave evidence that she travelled with her husband and two children to Jakarta between 5 August and 10 August 2010. It seemed to me that she was seeking at this point in her evidence to characterise this trip to Jakarta as a family vacation made possible through the redemption of their travel certificates. It was only in cross-examination that she said that she did not go on a vacation at all, but a conference organised by "Travel Ventures Express". She described this conference as a "travel seminar". It also became clear in the course of Ms Wetere's cross-examination that she did not redeem her travel vouchers on-line but that she instead made her accommodation arrangements through Travel Ventures Express in Jakarta.
86 There was evidence in reply called by the ACCC which puts Ms Wetere's evidence concerning her trip to Jakarta in proper context. Before referring to that evidence it is useful to refer to the terms of the travel certificates referred to by Ms Wetere in her evidence. These are in standard form and headed "Certificate of Membership". They purport to certify that the member named in the document "is a member in good standing of TVI Express and is entitled to the membership benefit of six nights and seven days vacation package." They include a certificate number and an expiry date as well as an introduction indicating that it may be redeemed at http://www.tviexpress.com/redemption/. They also include the following information:
Statement of Purpose
This certificate is valid for a registration validation form offering 6 nights and 7 days accommodation for two, in a three to five star property across the globe. After you redeem the certificate, your only cost is the hotel room taxes. The offer is NOT connected with any timeshare presentation or sales pitch of any kind.
To redeem the certificate, simply click on "Redeem Certificate". Simple redemption instructions are clearly printed on each certificate. No member should rely upon representations other than included on the certificate.
Redemption Instructions
You can redeem this certificate until the expiry date below. Redemption after the expiry will not be accepted. Simply click on "Redeem Certificate" to go through the terms and conditions. Once you accept the terms and conditions, fill up the online pre-booking form. Allow 10 to 14 days for us to complete and issue a list of hotels at your preferred destination.
87 The ACCC's evidence in reply established that a TVI Express conference was held in Jakarta on 8 August 2010 at the Gajah Madu Plaza in Jakarta. An announcement concerning the conference appeared on the TVI Express website. It included the following statement:
You may also utilize your free package travel certificate if you are willing to attend this training program in Indonesia. We have tie ups with Marlyn Hotel [sic] and Twin Plasa Hotel [sic] in Jakarta.
88 It may well be that Ms Wetere and her husband were each provided hotel accommodation in Jakarta for the purpose of attending the conference at reduced rates. What relationship, if any, the fact that they possessed travel certificates issued by TVI Express had to the cost of their accommodation in Jakarta is not clear. There is no evidence to indicate what rates they would have had to pay for the rooms they occupied on top of what they were required to pay in any event. Ms Wetere's evidence was that she paid $25.00 per day for each of two rooms and it was suggested, by implication at least, that this involved a substantial saving. However, the evidence in reply from the ACCC suggested that rooms in the hotel were likely to be available at a modest cost anyway. I do not regard Ms Wetere's evidence as establishing that travel certificates issued by TVI Express could be redeemed by members of TVI Express in order that they might enjoy vacation accommodation of six nights and seven days at their preferred destinations.
89 As to Ms Wetere's progress on the TVI Boards, she gave evidence that she had exited the Express Board seven times entitling her to US$70,000 together with residual income of "probably about five, six thousand" dollars. She said that she had personally introduced six people to TVI Express but she had difficulty estimating how many people in all were her downlines. She also gave evidence that the TVI Express System allows people to take up multiple positions on the TVI Boards by joining TVI Express more than once. She was asked why someone would want to do this. Ultimately, after considerable prevarication, she accepted that the reason why a person would take on more than one position on the board was to hasten the process of passing through it.
90 Asked whether she gave presentations to induce others to join the TVI Express System Ms Wetere said that she would not say that she gave such presentations to induce others to join. Asked if she gave such presentations to encourage others to join she said that she "wouldn't say encourage".
91 I did not consider Ms Wetere a satisfactory witness. It was apparent that she was keen to persuade me that her business (and, by implication, the respondents' businesses) was ethical and law abiding. Even so, there are aspects of her evidence which I consider important to the resolution of the issues in this case.
92 First, I infer from Ms Wetere's evidence that the most important factor which led her to join TVI Express was a desire to make money. I consider she would have understood the TVI Express System to be a "multi-level marketing" system from which she would be able to make a considerable amount of money in both the short and long term. I do not accept that the main reason, or a main reason, she or her husband joined TVI Express was so that they could take advantage of any of the travel discounts or other related benefits mentioned during the course of the presentation. She struck me as someone who was determined to make as much money as she could by selling as many memberships in the TVI Express System as she could to people who would also do the same.
93 Secondly, contrary to the evidence she gave, I infer that Ms Wetere regularly conducted presentations aimed at inducing or encouraging people to join TVI Express not so that they might enjoy travel benefits or opportunities allegedly provided by TVI Express, but so that they would make money for themselves and Ms Wetere by selling more memberships.