TINA finds 98% of sampled MLMs make misleading income claims
A new study from Truth in Advertising (TINA), claims 98% of studied MLM companies are using misleading income claims.
In other words, of the hundred MLM companies TINA studies, 98 percent are openly violating the FTC Act.
MLM companies in TINA’s study were mostly pooled from the US Direct Selling Association.
Noting DSA membership had declined from 140 companies to 93 over the past 6 years, TINA added Exp Realty, Tupperware, LegalShield, Pruvit, doTerra, Monat Global and Vida Divina.
TINA.org investigated the 100 companies and found that 98 percent were making misleading income representations in 2023.
TINA.org has collected more than 2,000 examples dating from 2018 to the present of companies and/or their distributors making inappropriate earnings claims on their websites and social media platforms.
This, despite the fact that DSA President Joseph Mariano was quoted in 2019 as stating, “Anyone who’s saying that you’re going to make a lot of money [with an MLM] is not telling the truth.”
One sticking point of the study is TINA challenging the DSA on its claim that “illegal earnings claims used to market MLM companies are few and far between.”
TINA has shared its finding with the DSA and the DSSRC, the DSA’s funded self-regulatory program.
In light of its findings, TINA suggests DSSRC’s “resources and/or tactics for finding [illegal earning] claims are lacking.”
Lifevantage is a company who really bends the truth with how much you can earn omg
Shaklee publishes the accurate average earnings for every rank and has an A+ Rating with the Better Business Bureau in the US and Canada.
They truly do honor their money back guarantee, so in the past 44 years, I have not lost money or friends if for any reason a product is not satisfactory.
Most people with a brain will know it s not possible for the masses to earn huge sums of money in MLM.
But there are a lot of people, mainly in the third world and complete newbies that are scammed by most MLM company advertising websites into thinking this!
In the U.K. this would be jumped on by Trading Standards and Advertising Standards.
Why didn’t they say which two companies comprised the 2%?
To make up 100, did they hand select 7 companies they knew would be part of the 98%?
Has anyone checked their determination of illegal claims? I pulled up just one to check. I can’t see any income claims at all.
truthinadvertising.org/wp-content/uploads/2023/09/Advocare_website_Anna.png
Also, TINA overlooks that some people become distributors to obtain lower prices on products they purchase. They have no desire to make money….
Agreed Lottie – and a lot of the time it’s the Distributors (and not Company) who go against contractual agreements, by making ludicrous income claims – just to entice others to join in order to earn. Awful.
@Lottie
I think TINA just picked well-known US centric MLM companies that weren’t in the DSA. Doubt they’d know beforehand who was violating before looking it up.
TINA did inform the MLM companies of their illegal activity. I wouldn’t be surprised if some action was taken prior to the study being made public.
As per FTC v. Herbalife and FTC v. Vemma, distributors are not retail customers. If you sign up as an MLM distributor you have a desire to make money, otherwise you’d be a preferred customer.
If the MLM company doesn’t offer a preferred customer class that’s an intentional attempt to hide what is likely a pyramid scheme.
@Evelyn
Under US law MLM companies are responsible for distributor compliance violations.
@Oz I totally agree. Seems many companies lose control of their distributors. An ongoing nightmare.
Mandatory Company Policy Training is not always first on the agenda, as it should be.
@Lottie
Here is a pretty thorough look into TINA and they do list many claims.
youtube.com/watch?v=rbJxlpxsRQM
98% of MLMs use MISLEADING income claims (Julie Anderson – reviews it).
@Oz
The example I pulled up was TINA’s archived version of the page allegedly showing an income claim. It was not the real time page that could have been remediated.
I am still curious why TINA did not indicate who the 2 companies comprising the 2% are. It would seem that these 2 companies should be examples to the others. But TINA only reported the negative information.
@scarecrow
98% of the companies evaluated in TINA’s study, not 98% of MLMs.
@Lottie,
If one wants to become aware, get questions answered, one needs to research, take suggestions given to them on where to find their answers, etc.
I am assuming you didn’t even watch the first several minutes of the link I posted because at time 3:16 the article itself is titled (part of it) Tina.org investigation finds 98% of MLMs using misleading claims.
Furthermore, if you watch it, you will find who the “2%” are because the person that reviewed the article goes through it thoroughly LIKE I SAID she did.
Your answers are in the link I provided… take the time to learn or don’t and continue to come on to places like this asking the same thing twice expecting a miraculous answer to present itself. I led you to water… take a drink.
TINA could have named the 2% companies in their article, that’s a fair point. Not sure how that would be “an example to others” though.
Don’t make illegal income claims to market your MLM opportunity. It’s that simple.
@Scarecrow
There is no evidence that 98% of MLMs make illegal income claims. There is only evidence that 98% of the 100 MLMs TINA evaluated made illegal claims. You cannot extrapolate the results of a sample of 100 to ALL MLM companies.
I am fully supportive of stopping illegal claims. They continue to hurt the entire industry.
In the same way that MLMs should not exaggerate their income opportunities, however, one should not exaggerate the findings of investigations into those claims.
@Oz
The companies that were not making illegal claims could be an example to others of what TO DO instead of what not to do.
In other words, the companies are doing at least one thing right if they are in business and not relying on illegal income claims.
@Oz
Yes it should be easy: do not make illegal income claims. But distributors push back so hard with the arguments that it paralyzes their business or everyone does it.
To be able to show that there are companies that succeed without those claims is ammunition against those arguments.
And that’s where the conversation ends. There is no pushing back on illegal conduct.
The distributors are wrong and if US regulators have to shut down MLM companies as a result, so be it.
If it’s illegal to do 200mph down the freeway, I don’t need to see examples of people doing 60mph before I stop doing 200mph. Not breaking the law is a pretty simple concept.
@OZ Great analogy. Except that in the MLM world 98 are doing 200 mph while only 2 are going the speed limit! LOL