YTB International files for Chapter 11 in Illinois

YTB International Inc. has seen a significant loss in revenue recently. This fact, coupled with the resignation of several key employees and board members, has prompted the company to file for Chapter 11 bankruptcy protection in the Southern District of Illinois. The company has listed its assets as $1.31 million and its liabilities as $7.18 million.

YTB International Inc. markets web-based travel products and services and operated on a business model of multilevel marketing. However, the company has had to restructure its business model. This is due, at least in part, to settlements with the California and Illinois attorney generals surrounding allegations of deceptive marketing. After this change, revenue declined and the company sold its headquarters and the property adjacent to it.

The company has not been able to keep up with its regulatory filings for a variety of reasons including the loss of key staff. YTB was going to merge with another multilevel marketing company last March, but the deal was called off last September. The company is also having issues with mistakes in its financial statements.

The current CEO of the company hopes that filing for Chapter 11 bankruptcy protection will shield YTB from its creditors long enough to reorganize. The company is said to have a commitment for a debtor-in-possession line of credit to help with the company's reorganization. There may be other companies in Illinois that could also benefit from filing for Chapter 11 bankruptcy protection. Having the time and space to review the company's financial situation and come up with viable options for reorganization could mean the difference between the business having a successful future or not.

Source: St. Louis Business Journal, "YTB International files for Chapter 11 bankruptcy," Diana Barr, March 5, 2013

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