John Oliver’s Last Week Tonight exposes “pyramid scheme” MLMs
In line with the nature of Last Week Tonight, this is more of an entertainment piece as opposed to BehindMLM’s regular coverage.
In the latest episode of Last Week Tonight, an Emmy award-winning weekly news and current events show aired on HBO, host John Oliver discusses MLM.
Oliver begins the segment with the familiar MLM cliché; “I would like to talk to you about an exciting opportunity. I just need thirty minutes of your time”.
The segment initially focuses on the recruitment aspect of the industry, contrasting it against retail product sales as a competing interest.
Elements of the MLM industry examined by Oliver include:
- celebrity endorsements
- the “cult-like status” of company founders
- MLM marketing claims
- health benefit claims
- inventory loading
- convoluted compensation plans
- chain-recruitment
- income disclosure (including retail sales disclosures)
- FTC regulation of the MLM industry
- exploitation of minorities
- pseudo-compliance and
- lobbying on behalf of the MLM industry
Vemma, Herbalife, Max International, Advocare, Youngevity, Kyani, Le-vel, Jusuru, Usana, Nu Skin and Mary Kay are all featured in the segment.
The show wraps up with Oliver launching his own MLM company, #thisisapyramidscheme.
I want to tell you about a fantastic product that you can share with friends and family.
The product is this entire video about why MLMs are fucking awful.
Let me break it down for you. By sharing this (video), you can be an independent for a leading web video about the dangers of MLMs.
You can do this full-time or part-time and give your family the lifestyle they deserve. Which is frankly not getting caught up in this bullshit.
You need scientific proof that it works?
We told a dog that we were going to product this video… and look, the dog is walking now!
Was it able to walk before? Sorry, we don’t keep those records.
Here is how it works:
Simply watch this video and then forward it to five people. And then instruct them to forward it to another five people and so on and so on and so on.
Within fourteen cycles every single person on Earth will have seen this, to the point that we will need to start fucking to create more people to watch it.
So please, share this video to stop people from getting involved with these schemes. Because MLMs are hurting people and we need to spread the word about their dangers.
Send this to twenty people, thirty people, a hundred people. What are you waiting for?! This system will work!
And it’s not a dimaryp, it’s an anti-dimaryp. This is a pyramid, right?
Right! This is a pyramid! We are in a pyramid!
Bit of trivia for you: A few months ago I had a researcher from Last Week Tonight contact me about an upcoming segment on MLMs.
Didn’t go any further than that though (privacy reasons on my side).
Can tell its fake, the video is not available in the UK 🙂
Must be local licensing issue with HBO unfortunately. If there’s a local version available it’s worth the watch.
The video is not available in Australia, either.
YouTube displays this message:
“The uploader has not made this video available in your country”
Less than 5 minutes in and already cracking up with laughter 🙂
J. R. Ridinger is hilarious…. Ludicrous but hilarious 🙂
I lost it when they showed him busting a nut at the Joe Average tombstone. Bloody hell… what an industry this is.
Use Tor Browser in case you cannot watch the clip. It does make me wander though why they didn’t make it globally available when Oliver covered international impact of MLM’s.
No problem watching it in The Netherlands through an FB post on Eric Worre’s FB page (go figure!) 🙂
Eric Worre is gonna publish his own “reaction” to how MLM is being attack again like when Dave Ramsey gave a pretty even headed recommendation a while back.
Worre is gonna go positively rabid over this one, or ridicule it like “see how crazy and jealous they are”.
If you have Sky+HD in the UK the whole episode is available to view on catchup.
Search for Last Week Tonight and Download S3, ep29
It really is worth watching.
This person should not be talking about something he doesn’t know about. He’s ignorant !!!
Let him stay in his pitiful J.O.B and work 40 hours a day for 40 years. MLM, if done right, is the ordinary person’s hope for a better life. Note, I said , if done right…
All he’s talking about are the bad MLMers. So one-sided. FYI, there are many millionaires in MLM who own their lives.
^^ Sounds like the end-result of being at one of J. R. Ridinger’s rant events…
I’m pretty sure Oliver’s happy with his life. The usual MLM marketing tropes might work on family on friends, but it’s a bit of a stretch to use them on the host of an Emmy-award winning show with a team of writers and researchers.
And how many more who paid for it and as a result don’t?
Becky implies that she knows what she is talking about.
Wouldn’t I love to know how much profit Becky has made in MLM and in which one? Or were there several? Is she retired from one or speaking of her future?
What’s her definition of “done right”? Does she did have a job, how big is her downline, and how much does she retail to non-affiliates?
Think she’ll have the guts to tell us – the truth?
Yes and those are far few and in between all the 1000’s of people in downlines that just don’t make a dime.
I guess we can count you as one that just didn’t make it either.
dream on!!!
woah, that ridinger guy is downright scary!
i thought he was doing a dramatic caricature of an MLM leader and was a part of the comedy show.
but he’s playing himself and he’s real!! scary!!
oliver is kickass funny, but bloody cruel to the MLM industry.
so who’s winning in the US. if trump slides his butt into the white house the DSA is going to push through it’s bill which makes self consumption on autoship legal.
IMO, the FTC is being overbearingly strict and at the other end the industry wants to be a ‘legal’ pyramid scheme, lets hope things settle down somewhere in the middle and everybody’s happy!
The YouTube like to dislike ratio is similar to the percentages of those who make money compared to those who don’t in MLM’s.
The defenders are making their money on ‘friends’ & family so they defend this industry and practices at all costs since their own livelihood is dependent upon the scam.
Ridinger’s onstage display is funny, but sad… his members are cult like in their devotion.
I watched this video via YouTube on a UK friendly link yesterday morning after Art Jonak flagged it up.
I loved it, since it really is a humourous piece of writing and broadcast. Superb in my view.
Serious point though he hammers home product based MLMs with autoships are very close to running a pyramid aka Dimaryp as referenced by Ridinger, which is even more amusing.
Vemma are the root cause of these issues.
Herbalife are very close too.
Then he takes aim at the cult of MLM.
That is what I find most worrying. Too many are going that route and using hype rather than quality to sell their schemes.
Remain thankful, I am within a services based opportunity.
Just came here to see if you had already posted this. Glad to see you did!
leading MLM attorney kevin thompson has this opinion on trump becoming the new president of the US and it’s impact on the industry:
[FB, 10 hrs ago]
i wonder what changes thompson is recommending to the current draft of the anti-pyramiding bill proposed by the DSA?
i think this bill will become a conversation piece in the industry over the coming few months.
Becky has already obviously drunk the kool-aid.
Btw… all those “millionaires”… I know one shake-pushing “iso-cleanse” MLM that claims to make millionaires — but they calculate the numbers for cumulative years, gross earnings (note…not sales, but $ made recruiting), which wouldn’t include any of the independent consultants, expenses, taxes, etc. THATs how there are so many millionaires.
Pretty sure this company has former Disney marketing guru’s dictating how they ‘spin’ their stories, but underneath all the magic, it’s still just swampland.
A 1-sided piece of entertainment. Not a realistic piece of journalism.
Obviously there are people making money in mlm. Some make a little, some make a lot. Where are their stories?
Same with companies. Some good, some better, some great, some shit. Like any industry.
NuSkin was recently named one of the Top 5 Most Ethical Companies in America by Forbes Magazine. (You can look it up). Not mentioned by Oliver.
Their Nourish The Children program feeds more than 150,000 third world children EVERY DAY. All paid for by registered distributors. (You can look it up). Not mentioned by Oliver.
Does Disney do that? NuSkin’s income are verified by Price and Waterhouse, their financial statements are submitted to the SEC every quarter. Nothing to hide.
Everyone is told over and over again that there are no guarantees and that making money will take real effort over time. (You can look it up). No mention by Oliver.
Makes you wonder how legitimate are any of his rants, or are the all skewed for entertainment value? At the end of the day, this show is entertainment, not news.
I like it, btw, great entertainment, but really, let’s not take it as a serious judgement on a 50-year-old $100Billion industry that engages some 100 million people worldwide.
John Oliver is whiny leftist who failed in the UK and now pushes political agenda in America. I absolutely can’t stand him…
However, everything he said in that segment was spot on.
*Slow clap*
@Lee
This is the same Nu Skin that was busted for running a pyramid scheme in China, and fined $47 million dollars by the SEC last month to settle pyramid scheme charges? (You can look it up).
Yeah no, Nu Skin are clearly the posterchild of ethics in MLM.
Well done, you managed to shoot yourself in the foot nicely there.
Dang, that’s right up there with the illegal drug industry. Impressive!
over the last three years or so ever since ackman shorted herbalife’s stock, the MLM industry has been centerstage and has faced heavy criticism from the media and MLM observers.
while the industry definitely deserves criticism and ridicule because of the way it functions and promotes itself, it must be remembered that MLM is a legal and regulated industry. extreme views for or against MLM do not help anybody and wisdom lies in remaining balanced.
after the tough stance of the FTC as seen in vemma and herbalife, the industry may now see a swing in the other direction due to donald trump’s election.
trump not only supports minimal regulation of businesses in general, but has also been an avid supporter of the MLM industry. he lent his brand and personally promoted the MLM ‘ideal health’ which was renamed the ‘trump network’ [which failed and was sold off as recently as 2012].
i don’t know if trump has revised his views about MLM since then, but here he is saying that:
youtube.com/watch?v=WVPvxu98xRs
he also says that he likes people to be successful and make money and enjoy that money. he says that someone told him he made more money in a month [in the network] than he had made in the last two years. so, i guess trump doesn’t mind the idea of MLM being promoted as a route to quick money and big money and top affiliates showing off their cars/yachts/planes.
the trump network sold vitamins and health products. affiliate commissions were paid on the joining business kit [around $180], which quite clearly are recruitment commissions. affiliates had to be on autoship too, to qualify for commissions.
even vemma and herbalife which came very close to being labelled pyramid schemes did not pay recruitment commissions on joining.
vemma got shafted because of it’s autoship and herbalife got roundly criticized by the FTC and even it’s ‘claimed’ retail of around 35% was deemed unsatisfactory.
in today’s environment the trump network is an out and out pyramid with recruitment commissions and autoship and with no encouragement of ‘retail’.
but, if trump is a fan of network marketing and promoted the kind of comp plan the trump network had, the MLM industry may soon be laughing at john oliver and not at his joke.
Cmon anjali, it’s not like Obama signs off on every MLM enforcement action the SEC, FTC or DOJ initiate.
Trump won’t either. And he’s certainly not going to single-handedly legalize Ponzi or pyramid schemes.
Regulation by these agencies will continue as it always has. The only thing that might change are how many enforcement actions we see.
Personally, I think we’ll continue to see more and more.
Fingers crossed. 🙂
And Vemma was given the Ethos award by DSA back in 2013. It got slapped by FTC in 2016 for being a pyramid scheme.
Furthermore, you need to get your citing right. First, NuSkin was named #5 in MIDCAP companies, among the Forbes 100 Ethical Companies, not all companies. And Forbes criteria was mainly regarding ACCOUNTING practices, i.e. no messing with the books (remember Enron?)
You really should actually READ what the awards are about before citing them.
nope. if the govt headed by trump asks for less regulatory interference in business then that’s what regulators will have to do.
if trump tells the FTC to back off from interfering with MLM companies the FTC will have to do so. there’s no ‘law’ governing the MLM industry specifically, the FTC regulates it according to it’s vision for the industry.
regulatory actions in pure ponzi/pyramid schemes with widget products may remain the same. but regulation of MLM with okayish ‘products’ which lie in the gray zone with respect to questions around autoship and retail requirements, may well cease. for instance a zeek may still be stopped by regulators under trump, but a vemma or herbalife would not face the stringent action that they did.
the long wished for ‘anti pyramid law’ for MLM has a very good chance of getting passed now, legalizing ‘autoship’ [in reasonable amounts] and avoiding any mention of ‘retail sales’.
if a president cannot make essential policy changes and set the tone for how regulators behave, why would there be such bitter fights over who should be president and such divided opinions?
Actually, I was mistaken. Forbe’s list was for “Top 100 TRUSTWORTHY companies (for accounting and corporate practices)”. It had nothing to do with overall ethics.
NuSkin was nowhere in the Ethisphere World’s Most Ethical Companies 2016 list.
this bill H.R.5230 — 114th Congress (2015-2016) was introduced by republican representative marsha blackburn.
the bill has a total of 29 co-sponsors till now, 20 of whom are republicans and 9 are democrats.
congress.gov/bill/114th-congress/house-bill/5230/cosponsors?q=%7B%22search%22%3A%5B%22hr+5230%22%5D%7D&r=1&overview=closed#tabs
now with the republicans in power, and a president who was bigly involved with an MLM bearing his own name, this bill is going to get pushed through. there may be some changes, but this is the bestest environment for the bill that the DSA can ever hope to get!
i have signed up to receive alerts about this bill, so i’ll report if there’s any movement.
30 now.
i found some material that supports this ^^ theory.
that trump is an ex MLMer is wellknown.
stephan bannon who ran trumps election campaign and who is credited for his win, has been appointed to the white house as trump’s ‘chief strategist’.
bannon runs ‘ Breitbart News’ which is considered a voice of the alt-right [polite term for rightwing racism].
what is important in MLM’s context is that brietbart news has supported herbalife and criticized ackman for attacking it :
breitbart.com/big-government/2016/07/21/bill-ackman-cant-manage-to-destroy-herbalife/
trump is also a personal buddy of icahn, the majority share holder of herbalife. i suspect that the ‘monitor’ who is going to be appointed to oversee that herbalife is toeing the line, post it’s FTC settlement will be an ahem, ‘friend’.
i don’t see trump and bannon as the kind of guys who are going to listen patiently to arguments in favor of >50% retail.
they will slap each others backs and say – the FTC is full of stupid stooopid people!! why do you need ANY retail in MLM?? bring on HR 5230!!
this will be good news for the ‘product based pyramid’ supporters in the MLM industry, while the rest of the industry will have to wait for somebody sensible to bridge the gap between extremes.
Betsy DeVos has been named President-Elect Donald Trump’s secretary of education.
so who’s betsy devos? she is married to dick devos the scion of Amway!
yep, the DSA has pulled up a chair right next to the president’s ear!
as bad as the last few years have been with the MLM industry getting bashed all over the media, the next few years are going to be quite the opposite.
MLM attorney jeffrey babener has started the conversation by checking whether the FTC’s proposed ‘guidelines’ for the MLM industry using the FTC/herbalife settlement as a blueprint, has basis in case law or not.
he suggests that the FTC is trying to circumvent the court and establish it’s own will on the industry:
i agree with this^^. just because the US does not have any MLM law, does not mean that the FTC can close the gap by unilaterally writing law under the guise of ‘guidance’. it’s just Plain Wrong for a regulator to assume such power and dangerous in a democracy.
with the republicans in power and trump in the whitehouse, babener reveals the cards the MLM industry now holds vis a vis the FTC:
quite a strong hand the MLM industry has here^^.
worldofdirectselling.com/fact-checking-ftc-new-guidance/
marsha blackburn is on the Executive Committee of trumps transition team:
patch.com/tennessee/franklin/rep-marsha-blackburn-tapped-donald-trump-transition-team
@anjali
Pyramid schemes evolve, so does the law.
At the end of the day regardless of what the FTC’s stance was 12 years ago, counting affiliate purchases as retail sales opens the floodgate for pyramid schemes to operate freely in the US.
Until I see the FTC or SEC lose a case because the court ruled sales to “ultimate users” overrides sales to retail customers, it’s a non-issue as far as I’m concerned.
I’ll say. How the heck can legitimacy of a product be established without outside sales?
I’d just love to have free license to bottle 8 ozs of bed pan urine and charge $100 each (That’s the affiliate wholesale price btw.)
Oh people will buy it because……
I will tell them that they will be called “business owners”, and of course they also get to pay the “wholesale” price. I’ll suggest they can make lots of money (like me but not really) ordering a bottle of pi$$ every month, and I’ll teach them to recruit others (for me) to do the same. I’d require them to pay me a fee even though they are doing all the work for my company.
Just think, I too could become a billionaire like Betsy DeVos.
And because I’m doing this for the people (not), I’ll honor my comp plan and kick back $6 a month to 97% of my sales force. I’ll tell them the riches will come in 2-5 years if they work hard enough. They should be long gone by then.
It’s such a simple scam when you stop and think about it.
yes retail is absolutely necessary in MLM.
IMO retail is more important as a yardstick to check value of a product rather than insisting majority sales are via retail.
as MLM is a unique mix of a product and a business opportunity, it’s natural for a person who likes the product to be interested in earning off it too. demanding majority retail in such an environment is not a ‘sensible’ or ‘practical’ approach.
while keeping retail as a non negotiable in MLM, the accent should be more on protecting participants from ‘harm’ [inventory loading, no buyback etc] than insisting on majority percentages of retail.
but as far as i see, this bill HR5230 is not insisting on retail at all!
this bill now has one more cosponsor, republican representative steve stivers of ohio, who signed up on nov 14, 2016.
I suppose it depends on how you see MLM as a business opportunity.
To me it’s not about paying a fee each month and recruiting others who do the same. That is and will always be a pyramid scheme.