By Scott Johnson
Amway has 2 major problems, and most MLMs have at least one of these issues:
1. The products are overpriced, which makes them almost impossible to sell to customers and results in Amway being an illegal pyramid, according to the FTC and SEC websites and previous court decisions; and
2. The Tool Scam [where Amway recruiters are pressured to buy expensive tapes, books, etc. on how to recruit in Amway] is hidden profit for the top-level distributors only, and the vast majority of distributors operate at a net loss as a result.
This is RICO fraud.
For recent examples, google “FTC” along with the following companies, one at a time: FHTM, BurnLounge, Zeek, TelexFree, Vemma, Advocare, and Herbalife. Make a complaint on the FTC website: https://www.ftccomplaintassistant.gov/?utm_source=takeaction#crnt&panel1-1
Although there is no federal law defining pyramid schemes, the FTC has a long and successful track record of using its Section 5 law prohibiting “unfair and deceptive” business practices to go after MLM scams: https://www.ftc.gov/tips-advice/business-center/guidance/multilevel-marketing which states, in part, “Not all multilevel marketing plans are legitimate. If the money you make is based on your sales to the public, it may be a legitimate multilevel marketing plan. If the money you make is based on the number of people you recruit and your sales to them, it’s probably not. It could be a pyramid scheme. Pyramid schemes are illegal, and the vast majority of participants lose money.”
Read about these and much more at these websites: http://www.StopTheAmwayToolScam.wordpress.com and http://www.AllMLMFacts.org, and email email@example.com to help shut down Amway and other MLM scams.
Watch this video about Amway and other MLM scams, then forward it to everyone you know, except for current Amway IBOs, and encourage them to do the same. When enough people know, these scams will collapse:
English version: https://www.youtube.com/watch?v=s6MwGeOm8iI
Spanish version: https://www.youtube.com/watch?v=Cy-O4myeUzg
So once again, let me make it simple for readers.
Amway is an illegal pyramid Multilevel Marketing scheme.
An illegal pyramid MLM is where there is a lack of retail sales to non-distributors. I know, I read the FTC website and the numerous lawsuits the FTC has won over the past few decades.
Just because they have been around a long time does not make them a clean company.
A 60-year-old company can be a fraud just like Bernie Madoff, Enron, Vemma, Herbalife, Advocare, Neora, etc., are frauds.
All of them were around for years, and some for decades, before they got caught.
This is the typical pro-MLM tripe that is offered up as sorry excuses.
The issue of an illegal pyramid has NOTHING to do with a geometric shape or how most organizations are arranged. The issue is that illegal pyramids have little to no retail sales. If most of the sales of a typical non-MLM were to the employees, that would be an illegal pyramid as well.
Another fallacy – comparing illegal pyramid MLMs to traditional companies – is that not everyone can become the CEO.
The real issue is that everybody in a corporation makes money, some more than others, whereas in MLM scams almost everyone loses money, especially when overhead costs, whether the costs are legitimate or feeding into a tool scam, are considered.
I have never said that “people have little professional experience to sell makes Amway an illegal business.” The issue has nothing to do with experience, it has everything to do with whether retail sales to non-distributors are being made.
The college costs money in Amway is also a red herring. If you major in a weak major, and can’t make much money when you graduate, that doesn’t suddenly make illegal pyramids legal.
These two topics have NOTHING to do with each other.
The high markup of products is another weak attempt at misdirecting the discussion. It doesn’t matter what the markup is, if you don’t make retail sales to non-distributors, the MLM is an illegal pyramid. Period.
The sports/Olympic analogy also has NOTHING to do with the lack of retail sales in an MLM scam. NOTHING.
Virtually anything is better than Amway. Flipping burgers for minimum wage is better than losing money at Amway.
YOU should get informed.
For every person who makes money, hundreds of others lose money, so it’s not saying much that you know somebody who is making money at Amway. The point is almost everyone else is losing money. Also, be sure you know the difference between gross profit and net profit.
If you lost money in Amway, you are not alone, there are millions of others just like you.
If you want to do your part, submit a complaint to the FTC at http://www.FTC.gov and/or forward the below John Oliver video link to everyone you know: