Financial Education Services has been fined $1 million dollars by the US state of Georgia.

FES has also been enjoined from ‘advertising, offering or selling credit repair services in Georgia’, effectively banning the MLM opportunity.

An investigation by Atlanta Attorney General’s office found FES

violated the Georgia Fair Business Practices Act by operating an illegal credit repair business and using unlawful and deceptive practices in their multi-level marketing structure.

As discussed in BehindMLM’s August 2018 review, Financial Education Services’ subscription pricing makes no sense. Affiliates are also forced to purchase a subscription.

In MLM this lends itself to pyramid recruitment, which is exactly what the Atlanta AG’s Office found;

FES violated the Georgia Multilevel Distribution Companies Act (MLDCA) by selling its credit repair products through a multilevel marketing scheme in which agents primarily earn money through the continued recruitment of other participants, rather than through the sale of credit repair products to non-participating consumers.

As pointed out by the AG’s Office FES’ offered service, credit repair, is “generally illegal in the state of Georgia”.

To get around this, FES created bogus non-profit organizations.

Our office alleges that FES tried to mislead consumers and circumvent state and federal credit repair laws by affiliating with a non-profit organization that the Defendants themselves managed and directed.

FES was co-founded by Parimal Naik and Mike Toloff.

Rather than defend itself, FES settled with the Atlanta AG’s Office.

The settlement saw FES pay a $1 million civil penalty in 2019. An additional $750,000 penalty is payable should FES violate the settlement terms.

Financial Education Services do not provide a copy of their compensation plan on their website.

Whether the company has made any changes to its compensation plan since the Georgia settlement is thus unclear.


Update 1st June 2022 – The FTC has sued Financial Education Services.

The regulator alleges FES is a $467 million dollar pyramid scheme.