Local News

Destiny Agrees to Change Business Practices in N.C.

Posted January 23, 1997 12:00 a.m. EST

— There have been major developments in a story that WRAL TV5 first broke in November. A phone card company accused of running a pyramid scheme has now agreed to change the way it does business,andto pay North Carolina $100,000.

Destiny Telecomm claims more than 15,000 independent sales representatives in the state and says it sells phone cards, beepers and fax machines. The attorney general's office concluded it was a pyramid scheme and didn't want it operating here. Now Destiny is back and wants a chance to get back into business doing things differently.

In late November, phone calls flooded in to the attorney general's office when its Consumer Protection Section warned Destiny to quit doing business or face a court battle. Under Destiny's old promotion, independent sales representatives had to pay to get started and made money as they recruited other representatives.

Deputy Attorney General Alan Hirsch says that's all changed under the new agreement.

Destiny President Randy Jeffers released a statement saying the company is "very pleased with the resolution of this matter and the timely cooperation extended ... by the State Attorney General's office".

The statement went on to say that the company looks "forward to continuing to expand ... business under these new guidelines in the great state of North Carolina".

Hirsch says Jeffers also agreed Destiny would pay the state $100,000.

Hirsch says the $100,000 isnota fine because Destiny is not admitting to breaking the law. The company's position is that it is not a pyramid scheme.

Hirsch says the state will apply the same standard to other multi-level-marketing sales programs in North Carolina. He says Destiny has agreed to strict monitoring to ensure its compliance with the guidelines.