When Things Go (Terribly) Wrong with Your Affiliate Network

I never recommend that anyone put all of their eggs into one affiliate network basket, so to speak, and here’s why:

In 2020 an Affiliate Network called RevenueWire was fined US$6.75m by the US Federal Trade Commission because two of its clients were scam artists. RevenueWire was processing hundreds of millions of dollars in online transactions in over 200 countries, and it’s entirely possible that every other product and service owner it represented was 100% legitimate. As far as I heard, RevenueWire’s payouts to affiliates were on time and everything seemed to be going smoothly until the FTC dropped the hammer.

The FTC claims that RevenueWire assisted Vast and Inbound Call Experts, the two firms responsible for running the scams, and was aware of their illegal activity, which involved tricking consumers into believing their computers had viruses or performance issues that required expensive repairs.

Court filings showed that RevenueWire’s fraud analyst warned company executives in a series of 2013 emails that they were “intrinsically associated with anything they (the scammers) do” and that “if things continue on as they are, it’s eminently possible that we will be caught up in a money laundering investigation.”

Whoops.

The FTC accused RevenueWire of using its merchant accounts to accept payments on behalf of the two firms and hiding the payments as software store sales instead of telemarketing sales.

The scams ran from 2011 to 2014, and according to the FTC, conned tens of thousands of consumers. In addition to the US$6.75m payment, the settlement required RevenueWire to be permanently banned from any further payment laundering and expected to screen and monitor high-risk clients for potential scam activity.

RevenueWire’s corporate counsel, Rajiv Gandhi, said the company did not admit the allegations and accepted the settlement to avoid incurring extraordinary costs litigating with the US government over complaints relating to parties with whom the company no longer does business.

Notice the 6-year lag between the time RevenueWire stopped working with the two scam companies and when they were fined by the FTC. It can take that long for mistakes to catch up with a company.

Today when you go to https://www.revenuewire.com/ all you will see on an otherwise blank page is…

A Big Thank You!

…in red letters. I don’t know when they closed, but I imagine the fine combined with the headlines were enough to bring about their demise.

If you had relied strictly on them for your affiliate programs, you would have been caught scrambling to find another affiliate network, get approved and then find new programs to replace your old ones.

That’s why I always recommend you use 2 or even 3 separate affiliate networks, so that you can immediately switch out programs at the drop of a hat if you ever need to.

https://www.capitaldaily.ca/news/revenuewire-fraud-federal-trade-commission-million