Desperate For Cash! Tori Spelling Promoting Business Sued For Pyramid Scheme
Tori Spelling is strapped for cash with multiple lawsuits pending against her for failing to pay credit card bills and taxes. Now, RadarOnline.com can exclusively reveal Spelling and her husband Dean McDermott are promoting a business once sued for being involved in a pyramid scheme.
Spelling, 44, and McDermott, 51, often promote Nu Skin, which is a multilevel marketing company that sells skin care and nutritional products.
In the lawsuit obtained from United States District Court of Utah, Robert Freedman filed a class action complaint on behalf of purchasers of Nu Skin Enterprises’ publically traded common stock on January 21, 2014.
The suit claimed the company is dependent on China for a significant amount of its revenue and growth, with sales accounting for one third of the company’s total revenue in the first nine months of 2013.
“It failed to disclose either its fraudulent sales practices and non-compliance with laws and regulations in China, or their potential impact on the company,” the suit read. “Then in January 2014, two Chinese agencies announced that they were probing the Company’s marketing and business practices in China and that it was suspected the company was operating an illegal pyramid scheme.”
The Plaintiff purchased shares of Nu Skin stock during July 10, 2013 and January 14, 2014. He claimed purchasers of Nu Skin common stock are in the thousands, if not higher.
“Defendants knew and failed to disclose that its sales and business practices in China were not in compliance with local law and regulation,” the complaint read. “Defendants knew and failed to discuss the negative impact that these practices would have on the company. Defendants knew that Nu Skin could not keep up its ‘strong momentum’ of its business… without the sales generated in China.”
A Chinese newspaper People Daily published a report claiming Nu Skin’s Chinese operations are in violation of the laws of the People’s Republic of China. “The article further reported that the Company brainwashes its trainees and sells 104 products, 20 more than the Chinese government allows,” the complaint read.
The Plaintiff continued to explain that the alleged scheme artificially inflated the price of Nu Skin common stock and operated as a "fraud or deceit on the Class.”
"As a result of their purchase of Nu Skin common stock during the Class Period, Plaintiff and other members of the Class suffered economic loss and damages" the Plaintiff alleged.
In Nu Skin’s response to the complaint, they denied the allegations against them.
The court accepted a settlement of $47 million.
As readers know, Nu Skin is Spelling’s latest way to eliminate her growing debt.
City National Bank sued Spelling and her husband in December 2016 for failing to pay a back loan of $400,000 given to them in 2010.
City National Bank accused the cash-strapped couple of “owing plaintiff an unpaid principle balance in the amount of $185,714.05, plus interest in the amount of $2,407.92 and late charges in the amount of $681.41, for a total of $188,803.38.”
They also demanded the mother-of-five pay the $17,149.09 she withdrew from September 2016.
In May 2017, City National Bank was awarded a judgment of $202,066.10 plus $17,730.56 after they ignored the filing.
Spelling and McDermott owe nearly $1 million in taxes as of November 2016.
In January 2016, American Express sued the actress for failing to pay an outstanding balance of $37, 981.97. Then in October 2016, American Express sued her again for $87,595.55. Both lawsuits are pending.
In March, police responded to Spelling’s home when she suffered an alleged nervous breakdown.
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