It’s one of the more sad stories in Domain Investing since I’ve been around. When I came on the scene the Rick Latona/Toby Clements newsletter was THE place to sell your domain. If you got your name on the newsletter it was an honor. I soon learned that half of the team didn’t operate in a manner I felt comfortable. Rick sold one of my names at an auction and took three months to pay me. Always excuses, always a reason. Getting the name to me and transferring it to the new owner on the other hand was quick and efficient. Payment was not as quick.
When Toby and Rick split up I didn’t know the exact reason. I had my suspicions but wasn’t privy to the information. But I figured that it would be good for the newsletter. At the time, people liked Toby. He was the one that you went to if you needed answers. He seemed to be the workhorse of the team. At the conferences he was a mover and a shaker. Always bidding on big names and was part of some of the bigger transactions going on at the time. But then something happened. The newsletters started going out less frequently and rumors started spreading that payouts were starting to take a bit longer. There were even rumors of a Ponzi scheme. Allegedly using new sales to pay out old sales. None of this has ever been verified except the part that people were not getting paid.
On June 6th at the domain site Toronto Domainer, Eon wrote,
I sold a name via Toby Clements’ newsletter on Jan 23, Mike Bowden, his associate, confirmed having received the payment from buyer on Feb 6. I sent him the EPP code and whois record showed that the transfer was done on Feb 13. Since then I had big difficulty connecting to Clements or Bowden for my money, actually I get only 2 replies from Toby Clements to my dozens of messages.
In a message on March 13, he said he was terribly sorry for his silence, because he had some large accounting errors and was in the process of getting a bridge loan from his bank to solve the problem, and the loan should be in place in a few days, then he could use it to pay me. (later I found out at dnforum some other victims received similar replies.http://www.dnforum.com/threads/dont-trust-toby-clements-as-a-broker.520760/)
On March 25, he wrote he had made a very large sale, which was expected closed out and paid by Friday. He would then be instructing escrow.com to send the funds to me directly.
After that I got nothing. These two gentlemen evaporated like ghosts.
There have been many of these types of posts and comments on the forums. Too many for it to not be a real problem. Toby has been noticeably absent from all the domain conferences as well. In my opinion it’s not going to end well for anyone. Toby’s reputation is already gone and I can’t imagine that all the people that are owed money will be paid. I’ve never seen good results from someone that is waiting for a big sale to come through to help pay off debt. After dealing with many people that owe me money I’ve heard it all. And they’ve all gone through these exact same stages. Lack of communication and when it does come it’s always an excuse and an undefined timeline of payment. And the only time I ever get paid is when I pay to put a lien against their personal home. I have 100% payment when I either call the police for fraud or place a lien. But that’s for the people that are owed money to decide.
When I talk to people in the industry privately most tell me it comes as no surprise. I find it hard to believe that someone that did millions in sales was always a scammer. There had to be a lot of successful transactions to do as well as he did for as many years as he did. Something went wrong. What that is we’ll never know. We only know that someone that was at the top of mountain in our industry is now a liability. Andrew Rosener of Media Options has since taken over the role of the top independent broker. The man (or team) who you want to give the big name to. And in some ways I think that only speeded up Toby’s demise. Names started moving over to Andrew and gave Toby less inventory. Regardless of the reasons, the results are the same. Toby Clements has vanished. He owes people money. And nobody really wants to talk about it publicly because it’s such a mess legally and morally. And all of it is bad for our industry