Michael Burton and his wife Michelle filed Chapter 7 bankruptcy this past summer in a Plano, Texas, bankruptcy court. Bankruptcy court documents showed that the couple had assets of only $74,136 and over $7.15 million in liabilities, including more than $1 million owed to the IRS.
So what, just who is this Michael Burton of whom we speak? Well, according to an interesting article in the New York Post
by Michelle Celarier, Burton was a top salesman for the nutritional supplement/diet aid Herbalife
Burton claimed, in a 2000 Herbalife magazine
, that he earned over $25,000 a month pitching the protein shakes. Not bad – an annual income of over $300,000.
At the time of their bankruptcy filing, the Burton’s income had decreased to $13,000/month, they had less than $100 in the bank and their $1 million home in Florida had been foreclosed. They reportedly owned two guns, furs, jewelry and a 2012 BMW
“While the exact trigger for the filing isn’t clear, it came days after Herbalife banned the lucrative but controversial practice of buying and selling sales leads. Lead-generation firms troll for sales recruits and could be evidence of pyramid-scheme activity,” the article states.
The move by the Los Angeles-based Herbalife to ban the purchase of leads came after activist investor Bill Ackman accused the company of being a pyramid scheme and placed a $1 billion short on the stock.
The Burtons owed money to Centurion Media and Ehome Business Network
, so-called Internet lead-generation businesses, court papers show.
In a phone interview, Michael Burton told The Post, “’The bankruptcy has absolutely nothing to do with Herbalife” and blamed his economic struggles on his other businesses that failed. He also claimed the $13,000 per month income listed in court papers is not actually true.’”
The filing may also leave Herbalife a little light, the article continues, since court documents show the couple owes the company an “unknown” amount of cash under a “personal guaranty of corporate distributorship agreement.”
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