Flixya is a start-up video sharing service, much like YouTube and Google Video. However, unlike its competitors, Flixya offers users incentives to share and upload videos: a Rewards Program and Revenue Sharing Program. The Revenue Sharing program offers a 50/50 split of all revenue earned from Adsense, Google’s Pay-Per-Click advertising program. The more video links you provide to Flixya, the greater your chances of making PPC revenue on the site.
Google’s Program Policies, however, state the following rules regarding incentives,

Web pages may not include incentives of any kind for users to click on ads (ads=referals too). This includes encouraging users to click on the ads … as well as drawing any undue attention to the ads.

Google’s Policy also states the following about labeling ads,

Publishers may not label the ads with text other than “sponsored links” or “advertisements.

And for purposes of these program policies, “referral buttons are considered to be ‘Google ads’”. Nevertheless, before and after a user signs up for an account with Flixya, they are shown several advertisements that direct them to sign up for an account with Google Adsense with an incentive to make money.
It seems readily apparent that instructing users to “Sign up for Google’s Ads to Share In Flixya’s Revenue Sharing Program” and labeling referral ads with the phrase “Sign Up” are blatant violations of Adsense TOS. Adsense users should also be concerned that using Flixya’s Revenue Sharing Program and viewing videos on Flixya will cause an increase in page impressions with Google Adsense, which is most definately a violation of Google’s TOS. This will lead to a user’s Adsense account being suspended.