For whatever it's worth, this is what I understand is going on:
RPs get paid a commission on sales or signups (like casino deposits, Netflip trials, credit card apps, etc.) made through their links. They pay a portion of that back to their users (in the form of points or rebates) then of course keep a portion for profit.
Since RPs can't find advertisers to pay per click (for site visits) anymore, and many pay-for-search engines specifically state they do not want visits from RPs, some RPs are subsidizing those free points we're earning by paying LESS for purchases and signups. Take Ebates. They may make 10% on a purchase, pay out 7% rebate, and keep the other 3% as profit. Then take Memolink and Blink (just to pick on them). They earn the same 10% but just pay out in points what amounts to 2%. They might keep the same 3% profit that ebates does. They take the other 5% and distribute it out as those "free daily points."
So you've got a tradeoff when you choose RPs: one that pays really well for purchases and signups but doesn't offer much if anything in the way of free points...or one that gives you free points but gives really weak rewards for purchases and signups.
As I understand it, CreationsRewards was trying to do both: providing lots of free points (a whopping 14cents a day at one point) while still giving excellent rewards for purchases and signups. Now how do you pull THAT one off? Where does the money come from?
CR was getting paid for user searches by going through a middleman -- since some search engines don't want anything to do with a rewards program, CR had an arrangement with another company so searches went through THAT business to the pay-for-search engines...violating the TOS of the search engines. When they found out what CR was doing, they immediately requested to be removed.
CR could get sued. They could go under entirely. I don't think CR's users could get in trouble since they were really being duped by CR's management. And they can't deny intentionally trying to defraud those companies, since at one point one of those middleman companies was OWNED by the same guy who owns CR.
But what's really bad here is that this is yet another black eye on the rewards program industry. RPs got totally slammed by Ebay merchants after some RPs were advocating abuse of the rewards ebay was offering for bids earlier this year. Some RPs, if you recall, were going to great lengths to explain how to clear cookies out so they could get credited for multiple bids, etc. This latest debacle is going to do nothing to improve our reputation -- and fewer advertisers means fewer rewards for us all.
Becky
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