Founded by Jay Van Andel and Richard Devos, Amway Corporation Inc. was charged with misrepresenting financial opportunities and being a pyramid distribution scheme 93 F.T.C. 618. MLM cult expert, Steven Hassan is familiar with the Amway MLM. In 1979, the FTC ruled that Amway was not in business to sell business opportunities. Findings 14244. See slide 4 from Amway's website.
MLMs are structured as pyramid schemes, with the addition of a product.The damage caused by aproduct-based pyramid scheme/MLM, far exceeds that of a no-product scheme by loss rate and number of victims.
From the Mannatech data and Shaklee MLMs formed since the unfortunate 1979 FTC v. Amway ruling, it is evident that they are more damaging than no-product schemes by any measure – loss rate, aggregate losses, and/or number of victims. Also see: Cult expert's view.
It's not Your Fault You are not Alone
The FTC allows Amway(s) and Mannatechs to do this.You have two important things to get done as an MLM victim. Share your story here to warn others then tell the FTC to protect consumers from product-based pyramid schemes or MLM.
TheFTChas recently cowered to the Direct Selling Association, the lobby for the MLM industry, by exempting MLMs from needing to disclose simple earnings data.The FTC has been “captured” by the DSA/MLM or "pyramid" lobby Does ibogaine therapy help with mlm addicts?
"It is also troubling that many uplines will tell their faithful followers that they need to purchase more and more tools (voicemail, cds, seminar tickets). Some IBOs were advised to skip meals to buy a cd, or skip paying the mortgage to be able to attend the next big function. As a newer IBO or prospect, you may have heard that "everyone starts at zero", or that it's a level playing field. It is not. As a new IBO, you will likely be in the 100 PV bracket. Since Amway pays out about 31% in bonuses, your upline(s) will split up about 28% in bonuses off your efforts while you get a 3%bonus."
It is also worth noting that cult experts are used to dealing with cult resues from Amway. In terms of the "scam" debate, Amway is similar to Mannatech. If you're investigating Amway, also look over the Mannatech income scam.