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MLM vs Pyramid Scheme

  • April 1, 2019

    Spencer Reese Weighs in on MLM Law, Civil Suits, and Public Perceptions

    Podcast episode 39

    It’s no secret that MLMs exist in a bit of a grey area. There is no federal definition of a pyramid scheme. Over the years, regulators’ objectives and strategies change—sometimes in a major way. But have you noticed all’s quiet on that front? There hasn’t been a major government action agains... Read more ›

  • April 16, 2018

    Boosting transparency to save direct sales

    Podcast episode 24

    Spencer Reese joins us again to talk about the current legal climate for MLM companies. He talks to us about the evolving definition of inventory loading, the dangers of illegal income claims, and the surprising absence of pyramid scheme allegations in recent FTC actions against direct sellers. Spence... Read more ›

  • April 9, 2018

    How to avoid joining a scam

    Tips for differentiating legitimate direct sellers from pyramid schemes

    First-time MLM distributors often wonder if the company they’re thinking about joining might be a scam. Unfortunately, some companies claiming to be legitimate MLMs are pyramid schemes. But many MLMs are legitimate businesses. So how can you tell the good from the bad? It’s not a bad idea to Google the... Read more ›

  • June 17, 2014

    The telltale signs of a pyramid scheme

    What’s the difference between a multilevel marketing program and a pyramid scheme? Pyramid schemes are illegal. If the money you earn is based on your sales to the public, the company may be a legitimate multilevel marketing plan. Here are some signs that the company is operating a pyramid scheme: •... Read more ›

  • May 6, 2011

    Multilevel Marketing Pyramids-“Lotteries”

    The following article is taken from the MLM Legal Primer . This article looks specifically at how lottery laws can be and are applied to MLM companies. Federal and state multilevel marketing and anti-pyramid statutes are components of a comprehensive consumer protection umbrella. These laws are designed t... Read more ›