CONTENTS:

Introduction

How The Scam Works

• Starting Out: "If I Work Hard, I'll Make It!"
• "Independent Contractor?"
• The Training Program
• Prospecting
• Failure: It's All Legal!

Fighting Back

• Avoiding The Scam
• Prosecution & Legislation
• Networking
• Links and Resources

Contact Author

A List of Some MLMs, Past and Present

A few might more correctly be termed "single level direct sellers," but they are still legally MLMs. Some have been investigated by the FTC; some are no longer in business.

You may search this page by using CTRL+F in your browser window.

1-800-PartyShop
1CellNet
21stNetwork.com
2Xtreme Performance International
4 the Good Life
4Life Research, LC
5LINX
8Point Communications
A Touch of Tahiti
Abundant Health Ltd.
Accentz
Acceris Communications
Achieve Success Team (AST)
Achievers Unlimited, Inc.
ACN, Inc.
AcoMark Concepts Pvt. Ltd.
Act II Jewelry, Inc.
Advanced Health Care Systems / Dean Distributors, Inc. / Cambridge Direct Sales / Medibase
AdvantageMax
Advantage International
Advantage Marketing Systems, Inc.
Advantage Neutraceuticals
AdverWorld
AdvoCare International
Affinity Just-2
Affordable Luxuries
Agent Nation
AIM International
Airlume, Inc.
Albert Konder Collection
Alive International
AlkalineLife.com
All That's Natural
AllAdvantage.com
Alloette Cosmetics
AlphaCom, Inc.
Alpine Industries, Inc.
Amazon Herb Company
AMC Corporation
American Bio Labs Inc.
American Communications Network ACN-
American Dream Nutrition
American Longevity
American Telecom Network (ATN)
AmeriKare
AmeriPlan USA
AmeriReach
AmeriSciences
AmeriTalks.com, Inc.
AMS Health Sciences (Advantage Marketing Systems)
AMSOIL
Amway / Quixtar / Alticor / Team of Destiny
Annása
Aqua America
Aqua Genus
AquaSource
ARAS Tiernahrung
Arbonne International, Inc.
Ardyss International
Array International
Art and Soul in the Home
Art Finds International
Artistic Impressions, Inc.
Ascend Technologies International
Ashley's Garden
Assured Nutrition Plus, Inc.
AtHome America, Inc.
Avalar Real Estate & Mortgage Network
Avalar Real Estate Alliance / Avalar Real Estate & Mortgage Network
Avon Products, Inc.
Awareness Corporation
AyurVida
Azante Jewelry
Aztech Financial
Bacchus Weinhaus
Bausparkasse Mainz
Bead Retreat
Basic Energy & Affiliated Resources, Inc.
Beat The System
BeautiControl
Bel'Air
Bessemer Sales
Big Bang Infonetwork Pvt. Ltd.
Big Book Direct
Big Co-op.com
Big Enough
Big Planet (NuSkin Enterprises)
Big Yellow Box
BigDot1
Bimini Essentials
Binney & Smith At Home, LLC
BioCrave Health Products
BioGenica
Biometics International, Inc.
Birthday Shack
Bittersweet Candle Co.
BizNas.com
Blessed Hope Communications
Blue Strawberry Bath
Bobri
Bodies Best International
Body Electric
BodyExtreme
Body Shop at Home
Body Soul Elements
Body Wise International, Inc.
Bodyguard Technologies
Books and Beyond, Inc.
Boudoir Bliss
Brain Garden
Bright Minds
Brown Bag Gourmet
Cabouchon International
Cajun Country Candies
Cambridge Diet
Cantralliance
Canyon World Quest
Carico International, Inc.
Cashcard Worldwide
CellTech
CenterSource Life Systems
Cera Bella
Changes International
Changes International, Inc.
Charitable Partners
Charmed Moments
Charmelle
Cherish Designs
Chesapeake Bay Company
Chez Ami
Claudia Jean
ClayTime Inc.
Clear Your Credit, Inc.
Close to My Heart
Club Depot
CoffeeFair
CoffeeFirst LLC
Cognigen
Color Connections
Comforts of Home
Concorde Group
Cognigen
Conklin Company, Inc.
Consumer 1st
Cooksey Keepsakes
Cosway Phils, Inc.
Country Bunny Bath & Body
Country Charm Candle & Soap Co.
Crafty Kids Pty Ltd.
Creative Memories
Creative Network International
Creative Photo Concepts
Credit Development International
Custom Corner
CyberWize.com
Daisy Blue Naturals, LLC
Darswinkle's Delights
Data Life Associates
Data Process Marketing (DP Marketing)
Debt Free America
Deesse International Gmbh
Delfin International
Demarle At Home, Inc.
Desire Parties
Destinations By Mava D.
Destiny Telecomm International
DeTech, Inc.
DHS Club
Gigital Dynamix (Trillion Dollar Trend)
Diolink
Diotek India Limited
Direct 2U Fashions Pty Ltd
Direct Educational Technologies India, Ltd.
Discovery Toys
Discovery Toys Inc.
Do Re Me
Doncaster
Doodles Direct
Dr. Glass Window Washing
Dream Impressions
DS-MAX U.S.A. Inc.
Dudley Products
DWG International
Dynamic Essentials
Dynamic Freedom, Inc.
Dynamite Marketing
E. Excel International
E Learn Express
Earth Essence
Earth Tribe
Easy Way
EcoQuest International
Eden River
Education Explorations
Eismann International Ltd
Elearnexpress.com
Electrolux LLC
Elements Home Spa
ELIXIR-HEALTH
Elysee Cosmetics
Empower Net
Enchanted Potions
Enchanted Scents & Potions by Design
Energy Release
eNewLife
Enjo Ltd
Enliven International Inc.
Eniva Corporation
Enrich International
Entertain With Ease!
Enviro-Tech International
E'OLA International
EonDeck.Com, Inc.
Equinox International / Trek Alliance / Advanced
Marketing Systems / BG Management
Espial USA
Essante Corporation
Essentially Yours Industries Inc.
eStarNetwork
Esteem Jewelry
Ethnic Expressions
Euphony Communications
EverydayWealth
Excel Telecommunications / Vartec Telecom
Executive Connections Network
EXOVAP Ltd.
F.A.I.T.H. Company
Family Health Network
Family of Eagles
Fantasy Lady
Federal Financial
FemOne
Fifth Avenue Collection, Ltd.
Filway
Firestone Farms Down Home
First Fitness
First Marketing Group
Five Star Auto Club
Flight of Fancy
For Your Pleasure, Inc.
For More International
Forever Living, L.L.C.
Forever Living Products International
ForMor International
Fortuna Alliance
Fortune Hi Tech Marketing
ForYou, Inc.
Free Network
Freedom One Services
FreeLife International
Freeway 100
French Rags
Frozen Lease
Fuel Zone
Fuller Brush Company
Fun For Life Club
Fun Quest of America
Funky Diva Shop
Furnished Garden
FutureMart
FutureNet, Inc.
Future World Corporation
Gabby Goodies
Gano Excel
GemCap Equity Management, Inc.
Genesis Today, Inc.
GetGasFree Marketing Group
Get the Word Out
Glass Bracelet
Giving You Credit, Inc.
Global Assistance Network for Charities
Global Communications Solutions Inc.
Global Community
Global Health Trax
Global Interactive Investment Club
Global Network Marketing, Inc.
Global Prelaunch
Global Prosperity Group /
Global Prosperity Marketing Group
Global Wellness Club
GlobalTelework
Globestar
Going Platinum, Inc.
Gold Canyon Candle
Gold Unlimited
Golden Neo-Life Diamite International (GNLD)
Golden Pride, Inc.
Goldiger Marketing
Goldshield Elite / Changes Intl.
Goldshield Group Ltd.
Good Books & Company, LLC
Good Life International
Good Nature Company
Good to Grow Garden Outfitters, LLC
Gourmet Coffee Club
Great Life Products
Greta's Bake at Home Cookies
Hawaii HerbalTech Corporation
HB Products
Health Dyamics Research Company
Health Voyage
Health-Mor
Healthy Outlook
Healthy Steps
HealthyPetNet
Henn Workshops
Herbalife / Newest Way to Wealth
Heritage Health Products Company
H.I.D. International
High Opportunity Petroleum Enterprise (HOPE)
High-Tech Safety
Higher Ideals
Highlights-Jigsaw Toy Factory, Ltd.
Holbrook Cottage, Inc.
Home & Garden Party
Home Business Group
Home Interiors & Gifts, Inc.
Home Owners Network Club
Homemade Gourmet, Inc.
Hsin Ten Enterprises USA, Inc.
HTEUSA
Hy Cite Corporation
ICR Services, Inc
Ideal Health
iKobo, Inc.
Immunocal
Immunotech Research, Ltd.
Imn Dot Com Pvt. Ltd.
In Touch Communications and Networking Inc.
Incredible Products
Infinity In'l Health & Beauty
Infinity2
InnerLight Inc.
Inside-n-out
Integris Global, LP
International Heritage
International Metals & Trade
International Teamworks Inc.
IONYX International
Iron Curtain Labs
ISPVIP.Biz
Jafra Cosmetics International, Inc.
Janglefish
Jeunique International, Inc.
Jewelry at Home
Jewels by Park Lane
JewelWay
Joielle LLC
Joy Enterprises
JS Homestyle, LLC
Jurak Corporation Worldwide
Just Add Guests
Kaire International / Kaire Nutraceuticals
KareMore International
KingsWay
Kirby Vacuum
Kitchen Fair
Lady Remington Jewelry, Inc.
Ladybug Garden Parties, Inc.
Lametco Int.
Latasia & Company
L'Bri Puren Natural
Le Club Privé
Le Gourmet Gift Baskets Inc.
Le Natural Int'l
Legacy for Life, Inc.
Legacy USA
Lia Sophia
Liberty Financial of North America Inc.
Life Dynamics
Life Force International
Life Plus International
Life Prints
Life Sciences Products, Inc.
Life Sciences Technologies
Lifestyles International
LifeTek
LifeTrends International
Links Worldwide Inc.
Living Scriptures, Inc.
Longevity Network, Ltd.
LR International
Lunesse
Luxelle International Inc.
Lyon Legacy
Magic Learning Systems
Magnus Enterprises
Mannatech, Incorporated
Market America, Inc.
Marpé International
Mary Kay, Inc.
Matol Botanical International
MAXXIS Group, Inc. / MAXXIS 2000
Melaleuca / The M.O.M. Team
Metabolife International
Metrin Life USA, Inc.
MILLIONAIRES GROUP
Momentum Nutrition & Health
Morganics
Morinda, Inc
MPAD Technology Group, Inc.
Multi-Pure Drinking Water Systems
Muscle Dynamics Fitness Network, Inc.
Musical Magnets
National Companies, Inc.
National Safety Associates (Juice Plus+)
Natural Bodylines
Natural Connections
Natural World
NaturaLab
Nature's Aromatherapy
Nature's Gold
Nature's of Scandinavia
Nature's Own
Nature's Sunshine Products
Nature's Wealth
Nebullis Network
Nefful U.S.A., Inc.
NEFX
NestFamily
Nettincome.net Limited
NeuroGenesis, Inc
New Image International, Inc.
New Sun Health
New Vision International, Inc.
New Vision USA, Inc.
Neways International
NexGen3000.com, Inc.
Nexx, LLC
Nikken Global, Inc.
Noevir USA, Inc.
Northern Lights at Home
Nouveau Riche
NOVAGENIX
Nove Chrome
NQI
NSA
Nu Creations, Inc.
Nubotanic Int.
Nueworld.com Commerce, Inc.
Nugenix
Nu-Life International
Nu-Med, Inc.
NuSkin / Big Planet / Pharmanex / Photomax Studios
NutriCare International
NutriHealth USA
Nutrimetics By Avalla
Nutrimetrics North America
NutriSystem Direct
NutriTech
Nutrition For Life
Nutronics International / The Coral Connection
Oasis Wellness Network
OmegaTrend
Omnitrition International
Open Invitation From House of Lloyd
Oragen International
Orbit the Talking Computer
Organics Made Easy
Oriflame U.S.A.
Oro Club
Outback Secrets
Oxyfresh Worldwide, Inc.
P.M. International
Pangea Ltd.
Paradigm Health International
Paramount Technologies
Partners in Vision International, Inc.
PartyLite Gifts, Inc.
Passion Parties, Inc.
Passport
Performance Plus Nutritionals
Petra Fashions, Inc.
Pharmalliance
PHD Products
Physicians Research Laboratories
Pinnacle Plus
Pioneerbizz.com
Pola USA, Inc.
Popular Club, Inc.
Power 2 Marketing LLC
Premier Designs, Inc.
Premier Health Link
Pre-Paid Legal Services®, Inc.
Primequest International
Primerica Financial Services (PFS) / AL Williams
Princess House, Inc.
Pro Monde Travel
Pro-Ma Systems
PRONET INC
PS I Love You
Publifacil
Purchase Plus Buyer's Group
Purely Gourmet LLC
Qi Technologies
Qual-Life
Quantum Leap
Quest Group International
Quest IV Health Products
Quiet Places
R-Garden Internationale
RDAY, Inc.
Rainbow Enzymes Inc.
Rainbow Vacuums / Rexaire
Regal Ware, Inc.
Reliv International, Inc.
Rena Ware International, Inc.
Retire Quickly Corporation
Re-Vita
Rexaire, Inc. (Rainbow Vacuums)
Rexall Showcase International
R-Garden Internationale
Richmont Direct
RightLife
Rocky Mountain International Silver and Gold, Inc.
Royal BodyCare, Inc.
Saladmaster, Inc.
Scentura Creations
SciMedica
Seaborne, LLC
Seasilver USA
Sea Energy
Self Indulgence
Send Out Cards.com
SeneGence International
Sensaria Natural Bodycare, Inc.
Shaklee Corporation
Shape Your Future
ShapeRight
Share the Wealth
Silpada Designs
Six Figure Income / SFI Marketing Group
SkyBiz
SkyQuestCom
Smart-Mart, Inc.
Soaring Eagle Ventures
Soteria Corporation
Southern Living at Home
Sparks International
Spedia
Sportron International
Stampin' Up!
Stanley Home Products
Starlight International
Strategies for Success
Streamline International
Sunrider International
SupraLife International
Sureal International
Symmetry Corporation
Symmetry Direct
Symmetry International
Synergy WorldWide
Tahitian Noni International / Morinda
TARRAH Cosmetics, Inc.
Taste of Gourmet
Tastefully Simple, Inc.
Tel-a-Nation.com
Telehop
Telephone Information Systems (Pleasure Time)
TeleWrx / Converge Global, Inc.
The Art of Better Living
The Body Shop At Home
The Brain Garden
The Claudia Jean Collection
The Comforts of Home, Inc.
The Country Peddlers & Company of America, Inc.
The Fuller Brush Company
The Furnished Garden
The Glass Bracelet
The Good Nature Company
The Homemaker's Idea Company
The Kirby Company
The Longaberger Company
The Mentor Network, Inc.
The National Companies
The Pampered Chef, Ltd.
The Peoples Network
The Right Solution
The Southwestern Company
The Story Teller
The Topline
The Traveling Vineyard
The West Bend Company
Tianshi Health Products, Inc.
Tidal Wave
Tomorrow's Treasures / Memory Bank
Totally Tropical Interiors, Ltd.
Toward Ultimate Financial Freedom
Transform America
Travelogia
TravelOne International
TrendMark International, Inc.
TriLokin International, Inc.
TriStar Enterprises, LLC
TriStar Online Sales Corporation / Suble Energy Solutions
True Wealth Creations
Tupperware Corporation
Turning Point
TuRobotNetwork
Two Sisters Gourmet
Ultra Corp
Unicity International, Inc.
Unicity Network, Inc.
Unique Solutions
Universal Direct
Usana Health Sciences, Inc
Usborne Books At Home
Vantel Pearls in the Oyster
Vaxa International
Vector Marketing / Cutco / Alcas Corp.
Viamore Corporation
Vibrant Performance
Vision For Life International
Visions Group of America
VisionQuest
VitaBorn
Vita Craft Corporation
Vitalife2000
Vitality Corporation / LifeChoice Corp.
Viva America
Viva Life Science, Inc.
Viviane Woodard Skincare
VM Direct
Vorwerk USA Company, LP
Voyager Group Inc.
Wallstreet Prophet
Wardson International
Warm Spirit, Inc.
Watkins Incorporated
Waves International
Webs to Multilevel
Weekender USA, Inc.
Wellness Associates
Wellness International
Wellness Premium Plus
West Bend Cookware
Wicker Plus, Ltd.
Wildtree Herbs, Inc.
World Book, Inc.
World Class Network
World Games - WGI
World Marketing Alliance (WMA) / World Financial Group (WFG) / National Lending Corp. (NLC) / Aegon Financial Group World
World Perfume
WorldxChange Corporation
WQdirect.com
XanGo LLC
Young Living Essential Oils
Youngevity, Inc.
YourNetPlus.Com, Inc.
Youthflow Corporation
Yves Rocher Direct Selling
zWallet
ZeBlooms, Inc.

Believe me, there are many, many more. There's one starting up and one going out of business every minute, so it isn't worth keeping the above list up-to-date. That list doesn't even include the many, many companies utilizing MLM structures and practices who do not fit neatly under the current MLM legal classification. See sources below for more MLMs.

Some Sources: 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12 www.ftc.gov, www.sec.gov
A good searchable alphabetical list of MLMs, including many not listed on this page, is HERE.

Links and Resources

(NOTE: If you stumbled in the back way because you were searching for info on MLMs [multi-level marketing organizations] or SALES JOBS [particularly in the financial, real estate, personnel staffing, or auto rental industries], then you might as well read this entire site from the beginning -- much of it applies to you as well.)

Links are provided for the visitor's convenience. Inclusion or exclusion of a link implies neither endorsement nor condemnation of its subject or source. Link lists are by no means all inclusive. Feel free to utilize the "Networking" page as well, which includes Message Boards you may search.

I. Books on the Financial Industry

Just a few, feel free to suggest some. If you're really on a budget, you can try getting them from ebay. Links below go to Amazon.com, which has used books for sale as well.

II. Reporting Fraud / Legal

• Reporting Fraud.
  • Federal Trade Commission (FTC). Submit a complaint about a company. Protects consumers against fraud and has an interest in stopping illegal pyramid schemes. While the FTC does not resolve individual consumer problems, your complaint helps them investigate fraud and can lead to law enforcement action.
  • Better Business Bureau. Complaints against a company can earn it an "unsatisfactory" rating in the locality in which it was reported. Keep in mind that the main purpose of the BBB is to resolve complaints against businesses, not condemn them.
  • FINRA - File A Regulatory Tip. (FINRA used to be NASD.) Perhaps you have knowledge of illegal practices by a manager, or your commission checks have been withheld for one reason or another. If you are aware of unfair practices or specific instances of abusive conduct or rules violations in the securities industry, FINRA wants to know about it.
  • SEC (Securities & Exchange Commission) - File a Complaint. Attorneys in the Division of Enforcement evaluate information and tips concerning violations of the federal securities laws.
  • IRS - Report Tax Fraud. If you believe a firm is misclassifying its employees as independent contractors, you may file a tip. If you feel you've been misclassified as an independent contractor to your detriment, submit form SS-8. The IRS can audit the firm and impose heavy fines on those caught misclassifying employees as well as save you paying taxes you aren't liable for to begin with.
  • YOUR STATE'S DEPT. OF REVENUE - Report Tax Fraud. As above. Links to all are here.
  • YOUR STATE'S DEPT. OF INSURANCE - Report Insurance Fraud. Links to all of them are here. For insurance-related issues, contact your state's Department of Insurance. Examples of insurance fraud that might be reported would be inducing policyowners to lie on their applications in order to influence rates, or even using private information from those applications to recruit the policyowner as a rep (yes, it's happened).
  • YOUR STATE'S UNEMPLOYMENT OFFICE - Obtain Unemployment Benefits. Ask for determination of employee classification (employee and not independent contractor) so you may obtain unemployment benefits. Each state sets its own standards for determination. Links to all states are here.
  • YOUR STATE'S DEPARTMENT OF LABOR - Report Labor Violations. List of them here. Report possible misclassification of employee as independent contractor, ask for a determination.
  • YOUR STATE'S ATTORNEY GENERAL - Report Legal Violations. Links to all of them are here. Report suspected fraud to your state's Attorney General, who can investigate and prosecute possible illegal pyramid schemes (those fall under CONSUMER PROTECTION).
  • EMPLOYMENT AD MEDIA. IMPORTANT! If you were recruited through a newspaper or online job search site, report the exact nature of the deception occurring within its media. Most media feel a public responsibility to remove fraudulent job postings and will do so if enough complaints are received. (See Monster.com's policy here.) Many media guidelines state that a job advertiser must offer bona fide employment, not an independent contractor or commission gig (these must be posted under "business opportunities" or "sales positions"). Remember, scammer firms cannot remain solvent if they cannot recruit, so your participation in this can aid in shutting them down when other regulatory actions fail or take too long in catching up.
• Legal: Activism. Feel free to mention this site, "An Employment Scam in the Financial Services Industry" at http://www.armydiller.com/financial-scam.
  • U.S. House of Representatives. Find your local legislator. Write to him or her in support of legislation that will protect consumers of jobs against businesses that misrepresent opportunities.
  • National Association of Attorney Generals. Locate your state's attorney general. Write to him or her in support of legislation that will protect consumers of jobs against businesses that misrepresent opportunities.
  • The "Anti-Pyramid Promotional Scheme Act of 2003" (HR 1220). Support modification of this bill to protect consumers of jobs against businesses that misrepresent opportunities. Beware deceptive language!
    • Pyramid Scheme Alert does NOT support the "Anti-Pyramid Promotional Scheme Act of 2003" bill. See also this page. Promoted by the DSA, tricky language is:
      • "'Pyramid scheme' means any operation in which a participant gives consideration for the right to receive compensation that is derived primarily from the recruitment of other persons as participants into the operation rather than from the sale of goods, services, or intangible property to participants or by participants to others." Opponents point out that the bolded language effectively legalizes product-based pyramid schemes and renders meaningless the FTC's 1979 "Amway Safeguards" ([...] "the '70% rule' and '10 customer rule' are meaningless if commissions are paid based on a distributor's wholesale sales [which are only sales to new recruits], and not based on actual retail sales"). The argument here is that MLMs that sell only to downlines have far more incentive to recruit in order to get rich off their downlines' backs (as with a pyramid scheme) than to actually sell products to the public at large. Fight to defeat this bill as it reads.
    • The Direct Selling Association (DSA) supports HR 1220; see their page on it.
    • Note that Dr. Jon Taylor's "The 5 Red Flags of Product-Based Pyramid Schemes" alleges that several states have already been duped into signing similar deceptive legislation (Texas, Montana, Louisiana, Oklahoma, New Mexico, and South Dakota; mlmlegal.com adds Kentucky). Georgia passed SB 141 in May 2005, which contains the same objectionable language as HR 1220. I'm sure other states have as well while critics weren't looking.
  • Florida Senate Bill 2648. According to PyramidSchemeAlert.com: "Virtually identical to a bill recently defeated in Utah [the defeated HB 269], SB 2648 would actually legalize pyramid schemes." Contains objectionable language similar to HR 1220 above. Florida residents, fight to defeat this bill as it reads.
• Legal: Prosecution.
  • FINRA Dispute Resolution. Information on mediation and arbitration.
  • American Bar Association (ABA) Lawyer Locator. Locate an attorney.
• Legal: Defense.
  • California Anti-SLAPP Project. Find out how to protect yourself against "Strategic Lawsuits Against Public Participation." Includes list of states with anti-SLAPP laws.
  • MlmSurvivor.com Article on "SLAPPs". Interesting examination of Amway's attempts to protect its image. Supports argument that a company need only name or continue to name critical website operators as defendants in unrelated cases to drain their finances and force closure of their sites. All cases were dismissed, but most site operators closed their sites.
  • The Anonymous Internet Foundation, Inc. May be able to help SLAPP targets obtain legal representation, even on a pro bono (for the public good) or reduced fee basis. Update 2009: Site does not appear to be maintained but is still active.

  See the Networking page for a list of message boards you may use to complain about your firm as well.

III. Research Your Company

• IRS Criteria for Independent Contractors vs. Employees. Make sure your firm has classified you correctly. Ask the IRS to make determination by filling out Form SS-8.
• Local Courts. If you've got an inkling that the firm could be crooked, don't miss this step. Call the court in the firm's jurisdiction and ask the clerk to look up cases in which the firm's name is mentioned. A large number of cases could certainly indicate trouble. A case with a large number of plaintiffs could be a class-action suit. Some courts provide past court cases free online. For others, you can request print copies for a reasonable fee. It's public record. (Unfortunately, a firm can use a plaintiff's "independent contractor" status to get out of being named in the lawsuit, so you still might miss any signs of wrongdoing.)
• SEC's Investment Advisor Public Disclosure site (FIRMS ONLY). Do the "Investment Advisor Search" on your firm. Note any marks on their "Disclosure Reporting Pages."
• SEC (Securities & Exchange Commission). Use the "search" function to research your firm. Be sure to put the firm's name in quotes. Note any regulatory actions. If you're interested in a bit of background about the SEC, check out Reality at the SEC (sorry - site temporarily down September 2005). The author worked for the SEC as attorney, offers opinions on why it is so difficult to shut down scammers. Fascinating site from a former insider.
• NASD (National Association of Securities Dealers) (NOW FINRA) (Individuals & Firms). Look up your firm or broker and make sure they are registered in your state (use FINRA's Brokercheck). If the broker offers securities and yet is not listed at all with the NASD, BEWARE. If you will be paying for licensing, check FINRA's rates for licenses you need and don't overpay for hidden training fees.
• Better Business Bureau. The Better Business Bureau is not necessarily a good source for learning about a company's reputation with employees, but you can learn how the business treats its clients. Complaints stay active for a very short period of time, however, and full individual complaints are not publicly searchable. At worst, the company gets an "unsatisfactory" rating, and then only in the locality in which it was reported. BBBs are discrete localized entities, not a single national watchdog entity. Keep in mind that the main purpose of the BBB is to resolve complaints against businesses, not condemn them. (A negative opinion of the BBB can be found in the red link text on this RipOffReport.com page -- it alleges that BBB membership is bought, not earned.)
• Switchboard.com. Locate people you worked with at the firm to get their stories. You may not be alone.

  See the Networking page for a list of message boards you may use for research as well.

  Also check Section VI. (Complaints Against Specific Financial Services Companies) below to see if your company has earned its own critical website(s). You may want to add your own complaints there.

• Search the Internet. Don't forget that you can target search results better by including the company name in "quotes". If you suspect the business is unethical, do a second search including words such as 'scam', 'fraud', or 'lawsuit' after the quoted company name. However, keep in mind that many websites are forced to close by the companies they're complaining about (SLAPP lawsuits), so the Internet is a shaky way to find complaints!

IV. MLMs (multi-level marketing organizations)
Also called: network marketing, direct marketing or direct sales, matrix marketing, viral marketing, referral marketing, dual marketing, consumer direct marketing, "home-based businesses".

Here are some websites about MLMs, some pro, some con.

• What's Wrong With Multi-Level Marketing? Anti-MLM. Note the section on "market saturation."
• The 10 Big Lies of Multi-Level Marketing. Anti-MLM. Attempts to debunk pro-MLM arguments.
• Lessons From The Pyramids: Why Nearly Everyone Loses Money in MLM, but So Many Keep Trying. Anti-MLM. Demonstrates the saturation argument against MLMs.
• 10 Lessons for Consumers from the Equinox Case. Anti-MLM. Equinox International was shut down by the FTC in 2001 as an illegal pyramid scheme. Topics covered include why illegal MLMs (pyramid schemes) can appear so legitimate, and why they're so hard to shut down.
• Quatloos.com: Multi-Level Marketing (MLM). Anti-MLM. Includes a brief history of MLM and why it can be argued to be obsolete.
• Truth on MLM. Anti-MLM. Very detailed site by Dr. Jon Taylor of the Consumer Awareness Institute, featuring his 10+ years of research on MLMs. Be sure to read the "5 Red Flags" of a Recruiting MLM or Product-Based Pyramid Scheme and the Evaluation of 125 MLM Programs. Note that the latter report posits that there are only two MLMs out of hundreds that qualify as legitimate opportunities based on the "5 Red Flags". The Evaluation was updated with over 250 MLM programs.
• The MLM File. Anti-MLM. One Ex-MLMer's 35-year experience. His motivation for creating the site: for "the hundreds of people I have personally known who have 'failed' in MLM, many of whom I directly caused to be recruited."
• USA Today: Don't Get Taken By Multi-Level Marketing. Anti-MLM. Author advises: "Never, and I mean never, sign up for a multilevel marketing (MLM) program"; lists why.
• Is There Really "Outstanding Growth Potential" for MLM? Anti-MLM. The answer would be "no"; the rich just get richer.
• Market Saturation in MLM. Anti-MLM. Product saturation versus business opportunity saturation -- what is really being sold? Why recruit your own competition?
• The Millenium Project's Section on MLMs. Anti-MLM. Author Peter Bowditch's entertaining opinions on and experiences with MLMs. Many comments on individual MLMs.
• The Lies of MLM. Pro-MLM, believe it or not. Warns MLMers against perpetuating some lies that less scrupulous MLMers made up, such as "MLM is the wave of the future" and "20 percent of all millionaires in America were created through Network Marketing".
• Direct Selling Association (DSA). Pro-MLM. Members include multi-level sellers such as Amway and Primerica; single level direct sellers such as Mary Kay & Tupperware. Supports HR 1220 (The "Anti-Pyramid Promotional Scheme Act of 2003"); see their page on it. Pyramid Scheme Alert is AGAINST HR 1220; see why. Pyramid Scheme Alert's website is www.pyramidschemealert.org, and the DSA registered www.pyramidschemealert.com (& .info, .net, .biz, etc.) in an attempt to hijack that site's mistyped traffic, so any respect I had for the DSA has evaporated.
• MLM vs Traditional Business. Pro-MLM. MLMer attempts to dissect the differences.
• Anti-MLM Zealots: Do They Have A Point? Pro-MLM. 10+ year MLMer Leonard Clements offers pro-MLM rebuttals against some popular anti-MLM websites.
• MLM.com's Directory of MLM Companies. Find out if the company that contacted you is an MLM using this searchable alphabetical directory.
• MLMWatchdog. Pro-MLMer Rod Cook attacks pyramid schemes and abusive MLMs.

V. Complaints Against MLMs Outside the Financial Services Industry

Your firm may not call itself an MLM, but if it utilizes any MLM practices (commission-only direct sales to mainly friends and family, bonuses to recruit others; and baser practices such as ongoing training programs and training materials that recruits are pressured to pay for, cattle-call interviews/inductions, misrepresenting the average income of reps to attract recruits, a cultic atmosphere that discourages "negative influences", etc.), it may share something in common with the following companies: a similar pattern of complaints.

This list is by no means exhaustive regarding companies or lists of complaints against them, but it's quite a large list in itself. Company links go to their official sites for balance.

• ACN, Inc. - (sells telecom services)
  • Exposing the Truth About ACN MLM. Alleges: misrepresentation of business opportunity, average (expected) incomes, chances of "success"; cult mentality; promotion of abuse of friendships.
  • Scam.com message board thread. Long thread alleges: high pressure sales tactics; salespeople seem desperate; deceptive advertising; only way to make money is to recruit; cult mentality; high dropout rate; inferior products, training, and customer service.
  • The Millenium Project has a page on ACN. Alleges: deceptive advertising; Canadian regulatory authorities charged ACN with illegal pyramiding; Australian authorities ruled ACN an illegal pyramid; ACN attempted to silence website with SLAPP suit.
  • MLMWatchdog.com has a page on ACN with the headline: "MLM ACN Australia Shortest Launch and Shut down in History". Site is Pro-MLM.
• Amway / Quixtar / Alticor / Team of Destiny - (sells variety of products; its old staple was soap/detergent)
  • The Skeptic's Dictionary. Page critical of Amway. Note allegations of: fantastic income appearances represented to recruits at rallies; only the "elite" will succeed; recruit's income increases are based on overrides on his sales force; reference to cult-like mentality or atmosphere; "Friends & Family List" is main "prospecting" tool.
  • mlmSurvivor: Amway vs. Critical Websites. Mentions examples of alleged SLAPP suits in which Amway continued naming critical websites as defendants in an apparently unrelated case, ultimately forcing those critics to close their sites.
  • A 1986 FTC Order determined that Amway had violated its 1979 FTC Order against making earnings claims for its distributors without disclosing actual average gross income figures.
• Avon - (sells cosmetics)
  • A 7/1/2004 PRNewswire article discusses a recent court case which accuses Avon of "channel stuffing", or artificially boosting its financial bottom line by charging for and shipping unordered products to sales representatives. Suggests an allegation of misrepresentation of realistic average (expected) income and artificial boosting of sales figures. In August 2004 the California Court of Appeals dumped the case but then reinstated it on appeal in May 2005.
• Discovery Toys - (sells educational toys)
  • This iVillage thread (2 short-ish pages) contains a few complaints implying misrepresentation of realistic average (expected) income, discomfort of friends and family as sales targets. Most of the pro-company posts sounded to me like people in the early "emotionally charged" stages common to MLMs and almost invariably include their Discovery Toys websites, appearing to use the message board in desperation for recruiting or sales.
• Equinox International / Trek Alliance / Advanced Marketing Systems / BG Management - (sold water filters)
  • This 1996 Santa Clara Valley Metro article recounts (though rather sensationally) several stories of failed reps who alleged: cult mentality; misrepresentation of realistic average (expected) income; heavy debts incurred by travel and other expenses encouraged in a "fake it till you make it" program; music before group interviews is purposely loud to discourage conversation (negativity).
  • Was shut down by FTC in April 2001 as an illegal pyramid scheme; the Trek Alliance version was shut down in 2003.
• Excel Telecommunications / Vartec Telecom - (sells long distance service)
  • This ComplaintStation.com thread (website no longer valid) alleges: misrepresentation of realistic average (expected) income. Note the replies by Excel supporters, which boil down to the usual: "You have a bad attitude"; "You didn't try hard enough".
• Health-Mor / FilterQueen - (sells vacuum cleaners & air purifiers)
  • This blog alleges: misrepresentation of job description; recruits must provide own first 10 leads before receiving any from company; abuse of trust relationships in selling to friends & family; misclassification of employees as independent contractors.
• Herbalife / Newest Way to Wealth - (sells vitamins)
  • This complaint describes one woman's experience, which alleges: front-loading of expensive inventory with a misleading refund policy; a cult atmosphere; misrepresentation of realistic average (expected) income; sales to friends and family (the only sales she made); high-pressure recruiting tactics.
  • Herbalife settled a 1986 lawsuit filed by the California Attorney General. Allegations included questionable claims made for products.
  • Related companies or divisions are Big Planet, Pharmanex, & Photomax.
  • Cockeyed.com has an amusing article in which the author muses about Herbalife's MLM format, market saturation, and the many "Lose Weight Now - Ask Me How" type signs distributors plastered (illegally) all over Sacramento.
• Mary Kay - (sells cosmetics)
  • See post #2 in this rather scathing ComplaintStation.com thread (website no longer valid) -- allegations are exaggerated but may be pared down to: misrepresentation of realistic average (expected) income; sales to friends and family; "warm chatter" with strangers to generate leads; encouraging front-loading of inventory "to succeed" (earn promotion levels) and high-pressure sales tactics; salespeople must pay to go to cultic pep rallies.
  • MKSurvivors is a Yahoo group; you need a Yahoo ID to sign up to read. "We deal in facts about issues, income and the realities of this business [...] we are a very diverse group of men and women all with a goal to expose the truths about this 'opportunity' as well as MLM's."
  • The Pinking Shears is an anti-Mary Kay website created by the founder of the MKSurvivors Yahoo group.
  • Edumacation.com has a message board section on Mary Kay. Allegations are all the usual: front-loading of inventory; high pressure to recruit and make continuing (unnecessary?) purchases to earn sales rewards; marriages harmed when cultic atmosphere causes front-line MK reps to dig the family into escalating debt behind partners' backs; unauthorized credit card charges; abuse of personal relationships; MK runs secondary "tools" business similar to Amway; misrepresentations about actual earned incomes. MK defenders counsel failures: "You didn't work the business hard enough."
  • A 2002 Law.com article says a jury in Texas hit Mary Kay Inc. with an $11.2 million verdict, including $10 million in punitive damages, for firing a sales manager disabled by cancer, who, the company contended, was not an employee but an independent contractor. May challenge IC status for all salespersons.
  • Update on Mary Kay v. Woolf: The 2002 decision was overturned. Woolf was determined to be not an “employee” under Texas law and thus not entitled to protection under California’s anti-discrimination statute. Note that "The 5 Red Flags of Product-Based Pyramid Schemes" alleges that Texas is among those states that inadvertently passed deceptive DSA-promoted legislation that effectively "legalized the worst pyramid schemes of all -- those that are product based."
• Melaleuca / The M.O.M. Team - (sells health products)
  • This mlmSurvivor.com article alleges: misrepresentation of turnover rate.
  • This RipOffReport.com page contains allegations of: misrepresentation of realistic average (expected) income, cult-like atmosphere, straining of relationships when selling to family and friends, obscuring the name and/or nature of the business because of prior bad publicity. Defenders use the same rote defenses ("you didn't try hard enough", "you're a negative person and I'm a positive one", citing company-provided propaganda).
• New Vision International - (sells dietary supplements)
  • A 1998 FTC Order decided that it made unsubstantiated claims about one of its products. Two principals were formerly with International Heritage, Inc. (IHI), a company prosecuted by the SEC on allegations of being an illegal pyramid scheme.
  • This peculiar page includes a New Vision recruit writing "We ignored the 'walk on the beaches of the world with us' scenario that our sponsor regurgitated and took a realistic look at the effort involved, the return, and the risk." Implies misrepresentation of realistic average (expected) income. Defense is the usual, implying those who failed "didn't try hard enough".
• NuSkin / Big Planet / Pharmanex / Photomax Studios - (sells health & beauty products, photo services)
  • This Complaints.com post alleges front-loading of expensive inventory with a misleading refund policy; misrepresentation of realistic average (expected) income.
  • A 1994 FTC Order ordered NuSkin to stop making questionable claims about its products and income/success representations.
  • The FTC determined NuSkin had continued the same violations in a 1997 FTC Order.
• Prepaid Legal Services - (sells a sort of "legal insurance policy")
• RipOffReport.com's page on the company includes allegations of: misrepresentation of realistic average (expected) income; misrepresentation of turnover rate; nondisclosure of expected expenses; cult-like meetings; products of questionable worth.
• World Perfume - (sells perfumes/colognes)
• This page alleges that Scentura Creations is the same company, another incarnation, or at a minimum very closely related.
• This RipOffReport.com page includes many allegations indentical to the points made on this site (though I read it many months after having written this site): misrepresentation of realistic average (expected) income and job duties; corporate sidestepping of legal responsibility by using recruits' "independent contractor" status; sales to friends and family during "training"; shutting down critical websites; cult-like atmosphere; encouraging front-loading of inventory; nondisclosure of expected expenses; cattle call interviews; obscuring the name and/or nature of the business because of prior bad publicity.

VI. Complaints Against Specific Financial Services Companies

Mention of these companies does NOT imply they are running a scam! Many have received many of the same complaints as the MLMs above; this is by no means an exhaustive list of such firms and complaints against them. Website owners/contributors are sometimes angry and sensationalistic, feeling very betrayed by their firm; I expect the reader to weed out bias and simply look at the pattern of similar complaints, and to note just in general that the firm has generated enough ill will as to earn its own critical websites at all. Do your own research and don't forget to search the message boards here and on this site's "Networking" page -- you may just find something on your own company.

Company links go to their official sites for balance.

• American Express Financial Advisors (AEFA)
  • Amexsux.com. I found a number of complaints on the "Financial" and "Employee" message boards alleging all the usual. A small sampling:
    • Thread 1.
    • Thread 2.
    • Thread 3.
    • Thread 4.
    • Thread 5. Also alleges that New England Financial is doing the same.
    • Thread 6
• American Income Life
  • Scam.com. This thread presents both sides from people who have worked for AIL. Some negative claims concern high turnover, brainwashing those who wish to leave into believing they've "failed"; managers making higher commissions on recruits less than 6 months old (discouraging retention because company keeps commission trails); promises of "unlimited income" that rarely pans out while recruits are suckered into paying for everything including rah-rah conventions in exotic locales; the company encourages recruits to put the job over their family; all the usual. One AIL defender amusingly says: "after 10 years with the company i can retire!! yeah thats right retire so while the rest of you work till your 65 i'll be 40 on some tropical island". One complainant only learned about his "independent contractor" status when he attempted to claim unemployment!
  • What's Up With American Income Life? Contact insurance investigator Mark Colbert at www.markcolbert.com or email him.
  • RipOffReport.com. There are a few pages, older than the above. Search the site for more. AIL has apparently been working with RipOffReport to address complaints. If you believe you have a legitimate complaint, you might contact RipOffReport and try to get it addressed that way first.
    • Page 1. If true, a pretty classic example of what this entire site is about.
    • Page 2. Story similar to above.
    • Page 3. Writer questions income represented.
    • Page 4. Agent claims to have lost $10,000 while at AIL.
    • Page 5. Writer warns college grads against AIL.
    • Page 6. Long thread, both sides respond
• Edward Jones
  • Edward Jones.info. British site. Info is for UK, USA, & Canada. According to this source, Edward Jones pressured the host into closing the site.
  • Attorney General Lockyer Files Major Securities Fraud Lawsuit Against Edward Jones. From the California Attorney General's website.
  • California Attorney General Settles Edward Jones Lawsuit (2008).
• Northwestern Mutual Life (NML)
  • Riverfront Times. "Training, he says, consisted of the new agents' listing the names and contact information of 200 friends and family members and rehearsing a scripted sales pitch for variable insurance."
  • nmlcomplaints.com. Includes negative testimonials. New grads should see the "NM Internship Program Facts" section.
  • An email I received reads: "This website has been shut down by order of US Circuit Judge Larry J. McKinney on July 27, 2006." The lawsuit is discussed in an article in The Milwaukee Journal-Sentinel. If Northwestern Mutual's allegations are true, then this is a textbook case in how NOT to aid those with ostensibly legitimate complaints.
  • As with most any defunct website, you can use the Internet Archive "Wayback Machine" at http://www.archive.org/web/web.php to view historical captures.
• Primerica Financial Services (PFS) / AL Williams
  • DMOZ Business Opportunities>Opposing Views>Primerica. A list of critical sites. Some may no longer be in operation.
  • "So What's With Primerica?" includes this page describing the author's allegations regarding how Primerica recruits and (mis?)-educates its reps.
  • RipOffReport.com has a few pages of complaints/defenses on Primerica.
    • Page 1.
    • Page 2.
    • Page 3.
• Trilogy Financial Services (TFS)
• Blogger Evelyn Baker attended a seminar for Trilogy Financial Services and wrote this article in which she described its presentation as identical to Primerica's, i.e. multi-level marketing like Amway; she feels MLM is code for "pyramid scheme". I'm not the only person noting the negative similarities between some companies in the financial services industry and MLM.
• World Marketing Alliance / World Financial Group (WMA/WFG) / National Lending Corp. (NLC) / Aegon Financial Group World
  • xWMA.org.
  • WFG-offline. Be sure to see the MONEY magazine article.
  • RipOffReport.com has a page or two of complaints/defenses on WMA/WFG.
    • Page 1.
    • Page 2.
  • Ted DeCorte's Eclectic Mouse Experience implies that Zillionaire.com (offline) / DotPlanet.com ("coming soon") is/was a biz op used as a "lead-in" to promote the securities and investments offered via WMA.

VII. Other Links

• Financial Planning Association. Welcomes those who advance in the financial planning process and promotes the CFP® marks as the cornerstone of the financial planning profession.
• Certified Financial Planner Board of Standards. Learn more about becoming a Certified Financial Planner™ professional.

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