Following a Freedom of Information (FOI) request sent by the New York Post on the 26th of January 2012, the FTC sent back a reply in late January.

The FOI request specifically targeted consumer complaints the FTC had received against Herbalife. After checking their records, the FTC disclosed that they had 717 pages of records detailing 188 complaints.

15 pages were “withheld” by the FTC, with the agency citing the information exempt due to the information being obtained “via a law enforcement investigation”.

After the New York Post went live with the story last Sunday night, the FTC responded to enquiries about the language of the FOI reply sent out, clarifying that

it had made a mistake and should have cited a foreign government agency, not law enforcement.

Unfortunately the FTC continue to neither deny or confirm whether or not they are investigating Herbalife themselves. Nor have they clarified which “foreign government agency(s)” are currently investigating the company.

With the above clarification noted, what I haven’t seen addressed anywhere however is the mention of “pending law enforcement action”, mentioned in two of the complaints the FTC provided. [Continue reading…]

I first looked at Network Marketing VT back in January 2011 and it wasn’t hard to identify a major red flag with the offering of 100% commissions coming out of membership fees.

Members would sign up to Network Marketing VT, gift 100% of their monthly membership fee to their upline and in order to earn commissions themselves, would have to recruit new members of their own.

A bunch of marketing material and private label rights resellable ebooks were included with monthly membership but with commissions coming out of monthly membership fees, were entirely irrelevant to the MLM business opportunity side of things.

Not surprisingly, it appears the root cause of Network Marketing VT’s collapse lies in commission payment problems. [Continue reading…]

In what is usually a quiet time for business around the world, here in the MLM industry we’ve had the FTC bust Fortune Hi-Tech Marketing for being a pyramid scheme, damning allegations exposing Bidify being made by Bidsson’s former CEO and of course the ongoing saga between Bill Ackman, Herbalife and the FTC.

Make no mistake, 2013 is shaping up to be one of the most explosive years in MLM I’ve seen since I started covering the industry on BehindMLM.

With January delivering multiple eye-opening stories, it appears February looks set to continue the trend with the FTC confirming today that Herbalife is indeed facing “pending law enforcement action”. [Continue reading…]

There is no information on the CashBackBooking website indicating who owns or runs the business.

The CashBackBooking’s website domain (“cashbackbooking.com”) was registered on the 12th of September 2012, however the domain registration is set to private.

As always, if an MLM company is not openly upfront about who is running or owns it, think long and hard about joining and/or handing over any money. [Continue reading…]

King Soap is a new MLM company that operates out of the US state of Utah.

The company is owned and operated by Randy Major. Whereas King Soap operates in the health and wellness MLM niche, Major’s past two MLM ventures have been in the social networking niche.

In 2011 Major (photo right) launched Treehouse social which was then replaced by Social Paycheck in late 2012.

Social Paycheck was a pay to click advertising network attached to a social network. With value to the advertiser at zero, when reviewing the Social Paycheck opportunity I placed a big question mark on the long-term viability of the business.

Not sure what happened with the company but just a few short months after launch Major appears to have decided to try something different with King Soap.

Read on for a full review of the King Soap MLM business opportunity. [Continue reading…]

In keeping with general tabs on the MLM industry as part of my research and what not here at BehindMLM, I process a lot more material on a daily basis than I write about.

One particular video came across my desk a week or so ago.

Despite being published a year and a half ago, I felt was worth dissecting as it pretty much confirmed the viewpoints I held about the company after reviewing the Empower Network late last year.

The “No Excuses Summit” is an annual training event (independent of Empower Network) run by Ferny Ceballos and his “crew”.

The footage we’re going to analyse today (available at the end of this article) is taken from the second No Excuses Summit which was held in mid 2011.

It features none other than Empower Network CEO David Wood as a speaker. [Continue reading…]

There is no information on the Coiros website indicating who owns or runs the business.

The company’s website domain was first registered back in 2002 but was last transferred on the 4th of August 2008, indicating this is when the current owners acquired it.

Coiros’ domain registration information is public but not being a Spanish speaker, doesn’t really make much sense to me:

Registrant Contact:

ALMACENET
(Ozedit: email address removed)
c/CIudad Cultural nA2
Villalba Lugo
27800 ES

Telf: +99.999999999

I have no idea what “Almacenet” or “ciudad Culutural nA2” is (Google turned up nothing relevant). Looking at that bogus phone number though, I can’t help but wonder if the rest of the entry contains legitimate information.

Vilalba Lugo (no double “L” in Vilalba) is a municipality in Spain and with much of the Coiros website targeting Spanish speakers, it appears that this is Coiros’ target market.

As always, if an MLM company is not openly upfront about who is running or owns it, think long and hard about joining and/or handing over any money. [Continue reading…]

Money For Causes went into prelaunch a few weeks ago and is headed up by owner Amy Jacobellis.

Money For Causes does not provide their location on their website, however the company’s website domain (“moneyforcauses.com”) was registered on the 18th of December 2012 and provides an address in the US state of Texas.

Somewhat curiously, Jacobellis lists the name of the MLM company Scentsy in the Money for Causes domain registration (image right), indicating a possible relationship between the two companies.

Scentsy is an MLM company founded in mid 2004 who market “scented wickless candles and decorative ceramic warmers”. The company is also a member of the Direct Selling Association (DSA).

Jacobellis isn’t listed as an executive on the Scentsy website, however in 2009 she credited herself as “working at” the company:

In addition to “working” for Scentsy, Jacobellis is also an affiliate of the company, maintaining a downline under the “The Young and the Wickless” team name.

On her personal website, Jacobellis (photo right) openly focuses on the recruitment of Scentsy affiliates, asking readers to contact her to get around Craiglist’s rules on recruitment advertising for any opportunity that cost money:

We should all be advertising and finding people who could easily sell Scentsy to their friends. I am looking for what I call “repeat hosts and hostesses.”

Some of those repeat hosts and hostesses will turn into consultants, and you can start building your team.

I found all my recruits from advertising, and I personally have signed up only 13 consultants. Now my team consists of 192 consultants.

If you can just find a few recruits and get them into the habit of advertising daily, your team will grow, I promise!

If you go to RESOURCES on your workstation, and click on “Consultant Spotlight,” and go to the very last page, you will see a map of where the Scentsy Consultants are.

Small towns are a great place to advertise, consultants in small towns do great. Think about advertising where we don’t yet have enough consultants.

Scentsy lets us advertise for recruits, but not advertise our products for sale. And on Craig’s LIst, we can’t advertise for anything that costs money to join, so this is kind of in-between.

Small towns are free, larger towns cost $25. I personally don’t want to pay, because the ad will need to be reposted daily, and there are so many towns that are free.

I posted the ad under “retail/wholesale.” You can put it under any category you think is best. You should try to re-post the ad daily.

You can’t post on Craigslist for actual recruiting, because it costs money to join, and craigslit (sic) doesn’t allow those ads. I had to make it into a job that doesn’t require any investment to make it follow Craig’s list rules.

Change the wording for each ad you post. I just add a word at the beginning or change the orders of the sentences. Otherwise, Craig’s list will flag you and take your ad down for posting the same ad.

They may also say you are posting too fast. Ask me how to get around this.

Although I am just advertising for them to be my host, I am hoping that as we form a relationship and they start selling, they will want to become a consultant.

Money For Causes appears to be Jacobellis’ first MLM venture on the admin side of things and on the company’s website she explains why she started it:

Before I developed this program, I was already making money passively from a couple of network marketing programs.

In late 2012 I decided to break down some of the compensation plans out there and see how many people it would take to earn $5,000 to $10,000 a month.

I NEEDED to make that much, to keep my kids in college and graduate school. In the spring of 2012, my husband was forced to take a job that paid 1/3 less than his previous job.

Causes was started as a way to raise money for college. And the next stage, graduate school, and the next stage, paying for student loans.

Read on for a full review of the Money For Causes MLM business opportunity. [Continue reading…]

What began as a day I thought I’d spend focusing my attention on analysis of the recent FTC bust of the Fortune Hi-Tech Marketing pyramid scheme with Herbalife’s business model, has quickly turned into covering the ongoing accusations between Bidify and former Bidsson CEO, Albert Liske.

Liske’s latest installment of the saga fires shots directly at the legitimacy of the Bidsson penny auction (which Bidify is the MLM business opportunity attached to), with Liske claiming that analysis of the Bidsson backend reveals an alarming number of “company won” auctions. [Continue reading…]

Whilst much of the news coverage surrounding Bill Ackman’s claims that Herbalife is a pyramid scheme has focused on stock market shenadigans, here at BehindMLM we’ve largely been focused on the issue of whether or not distributors can be classified as retail customers.

In one corner you have Herbalife and its supporters claiming you can, primarily on the premise that distributors purchase products for consumption in the exact same manner that retail customers do.

In the other corner are people like myself who believe that if you’re a distributor and participating in an MLM business opportunity, you’re obviously not a retail customer.

At least that’s the simplified core of the discussion that has ensued since I wrote my Herbalife review a few weeks ago.

Another tangent to the discussion is the familiar “well the regulators (FTC) haven’t done anything so obviously they don’t have a problem with Herbalife” argument. Here at BehindMLM we see this argument a lot, primarily used as an unofficial endorsement by the authorities of an MLM company’s business model I might find issues with.

Needless to say it’s a shallow argument that doesn’t carry any water. Moreso when you consider that the public aren’t privy to investigations carried out unless court action results (or the company in question voluntarily reveals they are being investigated, which for obvious reasons never happens).

On this particular topic of regulatory inaction, today news comes down the grapevine that the FTC have shutdown the MLM company Fortune Hi-Tech Marketing for operating what Kentucky Attorney General Jack Conway described as being ‘one of the most prolific pyramid schemes operating in North America‘.

Unfortunately I never got around to reviewing Fortune Hi-Tech Marketing (FHTM) so my knowledge of the company is limited. Fortunately for the purpose of this analysis however, FHTM itself is largely relevant.

Putting aside the stock market and Herbalife share prices for the moment (which incidentally slumped 11% upon news of the FTC taking down FHTM), I thought today we’d take a look at specifically what the FTC took issue with in the FHTM case and see if any of it applies to Herbalife from a purely MLM perspective. [Continue reading…]