A No-show of a Tradeshow

Natl. Expo Group has staff members sell space for non-existent events

By Rachel Wimberly -- Tradeshow Week, 1/15/2007

(This is the first in a series on fraudulent schemes involving non-existent shows.)

Near the end of 2006, Bill Gluth was hard at work running a small service-based business but, by his own account, things were a bit slow. In need of a little boost before the Christmas holiday, he looked on the Internet for a stay-at-home gig to make more money.

He couldn't believe his luck when he came across a sales job posted on Monster.com that offered an annual salary of $40,000 plus commissions to sell exhibit space for a company called Natl. Expo Group.

Natl. Expo Group ran a number of what it called expos across the United States including Natl. College Day, Natl. Home Expo USA, Natl. Real Estate and Finance Expo, and Natl. Computer Expo. Gluth said the company e-mailed him a job offer. He quickly signed the employee contract and tax forms, faxed them back and got to work.

He didn't know that what he was getting himself into was one small piece of a much bigger puzzle that would eventually lead to accusations of fraud, and potential civil and criminal action.

Not only would he, along with others that answered Internet ads to sell exhibit space for the same company, not be paid for their work; but also, Natl. Expo Group didn't have contracts on the scheduled days with any of the venues where the shows were supposedly booked ¡ª and in which salespeople were selling space ¡ª despite the company's claims to the contrary.

Natl. Expo Group, a subsidiary of Natl. Expo Sales (according to an employee contract obtained by Tradeshow Week), had been operating illegally ever since its business license was suspended in March 2002 for nonpayment of state taxes. The California Franchise Tax Board lists Kristen Yvette Martin as the owner of Natl. Expo Sales.

Martin told TSW that all the shows had been canceled as of Dec. 1 or Dec. 21 (different dates were given to employees than are listed on the company's Web site), when she filed for emergency bankruptcy. However, the U.S. Bankruptcy Court for the Oakland Division of Northern California, where Natl. Expo Group's business address was listed, has no record of any filing by the company.

Martin also said the tax board had incorrect information due to an error made by an employee who no longer works for her.

But there's more.

On Oct. 25, 2006, Gluth started making Natl. College Day sales calls to colleges on a list provided by Natl. Expo Group. The pitch was good ¡ª the company said it had a successful track record for the expo that regularly drew a high volume of high school students and their parents as attendees.

"It created an opportunity for colleges to exhibit and have parents and students coming," Gluth said. "I was calling marketplaces that had at least 1 million high school students."

Natl. College Day events were scheduled in 12 cities, including Las Vegas, San Francisco, Los Angeles, Atlanta and San Jose, Calif., the locations where Gluth was asked to sell space.

Colleges could expect capacity crowds and, as also advertised on the shows' Web sites, the event was hosted by the U.S. Dept. of Education. In fact, U.S. Secretary of Education Margaret Spellings was to be the keynote speaker for all 12 dates.

Still, Gluth had a huge challenge ahead of him. The very first Natl. College Day he was supposed to sell exhibit space for was just three weeks away, Nov. 18¨C19, at the Sands Expo & Convention Center/Venetian Resort Hotel Casino in Las Vegas.

"It was a really quick turnaround," he said. "But I sold two spaces for the Las Vegas event." Southwestern College and Grand Canyon University, both in Phoenix, bought $500 exhibitor packages that Gluth said included a 10¡ä¡Á10¡ä booth with pipe and drape, table and chairs, a garbage can and some advertising. The companies paid fees directly to Natl. Expo Group, and Gluth said his commission was to be approximately 10 percent.

Rebekah Dubina, admissions advisor and recruiter for Southwestern College, a small Christian school with 300 students, said she thought Natl. College Day sounded like a good fit for her school.

"Bill called and promoted the event. I looked it up online and did some research," Dubina said. "It looked reputable. We'd never heard of it before, but we're a pretty small school."

Dubina flew to Las Vegas Nov. 17, the night before the expo, woke up early the next morning and headed to the Sands to set up her booth. When she arrived at the venue, there was no evidence whatsoever of a Natl. College Day.

"I wandered around for an hour and then a security guard told me, 'The Sands is black today,' which I figured out meant there were no scheduled events," Dubina said. She thought she might be at the wrong venue, so she called the Las Vegas Convention & Visitors Authority and asked if the event was being held anywhere in Las Vegas on Nov. 18. The authority didn't have a listing for it.

"It was pretty bad, so I called Bill," Dubina said. "He had no clue what was going on. It was very frustrating."

Gluth gave Dubina the number for the owner of Natl. Expo Group, Kristen Martin. "She said the event was canceled and Bill didn't know because he was new," Dubina said. "She said she would refund me for the total amount."

With the exhibit fee, plane ticket, hotel and other expenses, Dubina estimated the trip cost the school approximately $1,100. "For our institution, that's significant," she added.

Gluth also called Martin, who told him she would call Dubina directly and take care of the problem. He called Martin again to follow up, but by then she wasn't returning his calls. After all, the show being canceled was just one problem he now had with her: He had yet to receive a paycheck.

"The first check was due Nov. 5, and it didn't show up. Neither did the next one," Gluth said.

Martin told him the checks were on the way. At one point, he got a check for $100, far less than the nearly $3,000 he believed was owed him, and there was an extra kicker: The $100 check wasn't signed. He called Martin again, who told him to send the check back and she would sign it. He never got another check.

TSW learned from a U.S. Dept. of Education spokesperson that not only was Secretary Spellings not scheduled to deliver a speech for the Nov. 18¨C19 event at the Sands, but she wasn't even in the country ¡ª she was in Asia.

Spellings was not scheduled to speak at any of the other 11 Natl. College Day events she was advertised as being a part of, either. The department had no knowledge of any of the events.

The Sands refused to comment on Natl. College Day, stating that all of its events, scheduled or not, were proprietary information.

Erica Brown, the recruiter for Grand Canyon University who Gluth also said bought a $500 exhibitor package for the Nov. 18 event at the Sands, did not return calls by press time.

Martin said the event being canceled and exhibitors showing up at the Sands was all "a misunderstanding." She said she had a signed contract with the Sands for the event, but due to "financial difficulties" she was forced to cancel it, as well as the other 11 scheduled dates, and file for emergency bankruptcy.

After TSW spoke to Martin on Jan. 2, all of the Web sites for the corresponding events were taken down and rerouted to a site announcing the bankruptcy.

"We are running a business in good faith," Martin said. "We intended to have all of those expos."

Martin said she reimbursed both Southwestern College and Grand Canyon University for their booth fees and travel expenses. Dubina was unable to confirm whether that was the case. School officials, she said, did not want "to make a big fuss" and preferred to move on from the incident.

"Looking back, I realize I was pretty easy bait," Dubina said. "Luckily, I bought the cheap package."

For Gluth, it was worse. "It was devastating," he said. "My own business had been slow when all of it fell through. I fell behind on everything."

Gluth and Dubina weren't the only ones taken in by Natl. Expo Group. Expos were advertised as taking place at convention centers throughout the United States, even though not a single one had a signed contract. Other public figures besides Spellings, who were reported to be speakers at the events (among them Donald Trump), said they knew nothing about them.

And, it appears, Natl. Expo Group is not the only company involved in a scam.

(The second installment of the series will appear in the Jan. 22 issue of TSW.)