MLM in the News

 

Contact Bot Watch with any news items you think should be included.

January 2019

Stella and Dot announce that they will be closing down their European operations in April.

 

December 2018

Craig Jerabeck is jailed for 14 months for fraud and filing false tax returns. Craig is the founder of 5Linx, an MLM. Full story here. Jeb Tyler and Jason Guck are awaiting their sentence. They were co-conspirators.

Lularoe are being sued for $33 million and are accused of hiding money. Article about it here.

August 2018

Lifevantage are facing a lawsuit that they are a pyramid scheme. TINA has the details here.

Fourth Jeunesse pyramid scheme lawsuit commences. Read about it at TINA.

May 2018

Bathology shut down with little more than a fizzle. Reps are given a day’s notice to shut down their operations. Reported in MLM News Report.

Gary Young, The Founder of Young Living died on 13th May 2018. He died as a result of complications following a series of strokes. MLM News Report has more details.

Hempworx warned by the authorities in Canada to stop selling their cannabis based products because they are illegal. News story at CBC here. One of the quotes from the article- “The company told affiliates the shut-down to the Canadian market was “due to the increasing demand to bring HempWorx products to Canada and our commitment to compliance.”

April 2018

Rodan and Fields are facing a law suit over a controversial ingredient in a mascara of theirs.

Inteletravel denied ABTA certification 13th April 2018.

Kleeneze have gone into administration. Report on BBC news.

Utility Warehouse found by the ASA to be advertising their phone package in an untruthful way.

17th February 2018

AVON pull out of Australia and New Zealand. Reps find out on Facebook.

22nd January 2018

Lyoness have been warned on 18th January to stop activities in Norway. They have been judged to be a pyramid scheme and breaking lottery laws. This is due to the findings that most of people’s income was based on recruiting, not sales. In Norway Lyoness is also known as ‘Lyconet’. Here is a link to the story. It is in Norwegan.

18th December 2017

USI Tech in trouble in British Columbia for not being properly registered.

16th December 2017

@direct_selling report on twitter that MLM Stem Tech have filed for bankruptcy.

12th December 2017

Juiceplus tell their reps that they will no longer be selling in a lot of European countries. No explanation is given.

11th December 2017

There are rumours that Vitae Global (who recently took over Xerveo) have stopped trading in the UK. A former top person in Xerveo wrote this on her public Facebook page.

A visit to Vitae Global UK’s website shows that it is no longer active. I have asked the company if they have closed down their UK operations.

3rd December 2017

LuLaRoe being sued AGAIN! This time it is by three women and a class action who claim they were encouraged to spend all their money, buy thousands of dollars in stock and get into massive debt. Legal documents here. Here is a snippet-

‘In reality, LuLaRoe is and was nothing more than a calculated endless chain scheme specifically designed by Defendants to unjustly enrich those at the
top of the pyramid structure of the enterprise at the expense of unsuspecting,
lower-level Consultants.’

The case claims that LuLaRoe was set up to con women from the start and includes many illegal activities. It claims the owners made hundreds of millions of dollars while most of the consultants were falling into debt.

 

17th November 2017

Vida Divina products are illegal to sell, advertise or supply in the UK. One of their products is a class C drug and you would officially be a drug dealer if you sold it. An Email from the MHRA has been circulating with many warnings in it.

15th November 2017

Kyani are being sued by an ex-distributor because she lost money in the scheme, despite working hard and doing everything she was told. TINA report on it here. The legal papers can be read here.

1st November 2017

Truth In Advertising report that Jeunesse are being sued for £1 billion for being a pyramid scheme. Again, distributors as well as the company owners are being accused of fraud. They are also being accused of making false health claims for their products. The legal document is 45 pages long!

1st November 2017

LuLaRoe are being sued in two separate actions in America.

1. A class action is taking place, claiming their buyback program was a con and that the company went back on their word that they would buy back unused stock and pay shipping. Because they changed the rules, people are now left with a lot of unwanted stock that they can’t sell when their ‘home business collapsed’ and they wanted to leave. Some people have thousands of dollars of stock that is now sitting in their garages or LuLaRoe’s own warehouse. Ethan Vanderbuilt analyses the situation.
2. The second class action case alleges that LuLaRoe is a pyramid scheme. Truth In Advertising analyse the situation here. The legal details are here. This case is interesting because it follow’s Herbalife’s recent law suit where top distributers are being included in the group of accused, as well as the company itself.

 

11th October 2017

 

The Joe Duffy Show interviews a man who has lost 900 Euros from being in One Coin. He has now been excluded from the scheme and is trying to get his money back.

11th October 2017

Arbonne have had their Rescue and Renew Detox body wash recalled in Australia as they contain a high level of Staphylococcus cohnii. This is not the first time products have been recalled by Arbonne. Last year it was some eyeliners that were contaminated.

11th October 2017

Mommygyver has appeared in court today to answer to LuLaRoe’s court action. A date has been set for a hearing on November 9th. She has written a blog exposing LuLaRoe and they have hit back by trying to make her give up her sources. An anti-MLM campaigning lawyer is defending her. (see 4th October)

 

 7th October 2017

LuLaRoe demonstration announced by LuLaNo, an anti-LuLaRoe group.

4th October 2017

The Salty Droid announced yesterday on their blog that they will be representing, on a pro bono basis, Christina Hinks, the woman behind the Mommygyver blog. She is having a bit of legal trouble from LuLaRoe who are trying to make her give up all her sources in an attempt to silence their voices from opposing LuLaRoe.

 

26th September 2017

Orion Research examine Herbalife’s Events system as described in the recent legal case and conclude that Herbalife have violated the FTC’s rulings about not being a pyramid scheme.

 

26th September 2017

Kriptacoin Ponzi scheme has been shut down in Brazil and arrests made. Read about the story on Ethan Vanderbuilt’s website. This is from that story and it seems like good advice to keep in mind when looking at investing in cryptocurrencies.

 

25th September 2017

Yesterday it was discovered that fake Herbalife emails have bee spreading ransomeware. A website called ‘Security Afairs’ has details.

 

23rd September 2017

Today Mommygyver announced the organising of a LuLaRoe protest at one of the company’s events in October. They are protesting at the refusal of the company to refund many thousands of dollars owed to reps who have sent back their unwanted inventory. These women have been promised refunds but have nothing.

 

23rd  September 2017

LuLaRoe are trying to get a blogger called Mommygyver to give up her sources. Mommygyver has been campaigning to help LuLaRoe members and ex members get their money back.

20th September 2017

Asirvia is an MLM that provided Royaltie (another MLM) with products. Asirvia claimed Royaltie owed them a lot of money and terminated their contract on 14th September. Royaltie are claiming they were bullied. Behind MLM have the story.

The product they provide is a Bluetooth device that emits marketing messages to phones nearby so that MLM reps can spread their message to strangers wherever they go.

19th September 2017

Herbalife are being sued in a class action because (it is alleged) they told people they could achieve success if they attended every training event. The complainants said that they were told to attend every meeting and this cost them money. They said they didn’t earn any money as a result of this and they wouldn’t have bothered if they knew how useless it was. They allege that the people at the top and the owners were earning money from these events.

19th September 2017

 

Young Living fined $760,000 for environmental breaches during the production of their essential oils.

18th September 2017

The Coin Telegraph reported last month about Italy fining OneCoin 2.5 million Euros for being a Ponzi scheme. Italy now join Hungary and India on the list of countries that have taken action against Onecoin.

17th September 2017

Peter Nordberg pleads guilty to tax fraud from when he was CEO of MAX MLM Partners. Story here. He’ll be sentenced later this year.

Also, from the same article-

16th September 2017

Beachbody fined $3.6 million for dodgy business practices

LA Times report on the court ruling against Beachbody. It was found they were deceiving customers by automatically renewing subscriptions without consent. Prosecutors also accused Beachbody of making misleading health claims and were asked to provide scientific evidence for these. The paper says “The city attorney’s office said the judgment is the result of an undercover investigation, consultation with scientific experts and negotiations with Beachbody’s attorneys that lasted more than two years.”

16th September 2017

Younique being sued for deceptive and misleading practices.

Their Moodstruck mascara was marketed and described on packaging as ‘100% natural green tea fibres’, when in fact, it contained crushed nylon. It is alleged that the product was too expensive for what it was. The legal information is contained here.

TINA are following the story.

From the legal document

11th September 2017

 

ViSalus being sued for defrauding and deceiving.

Business Wire report on the story that a group of investors are suing the MLM ViSalus over some financial dealings. It is alleged that people were offered shares in return for joining ViSalus as distributors. They were not offered properly and were never actually given. The above link has details if anyone wants to join the class action. It seems Visalus are also fighting another law suit on account of them being accused of being a pyramid scheme.

China

China is currently clamping down on pyramid schemes, including MLMs. MLMs are sort of banned in China where the rules are a bit harsher than the rest of the world. MLMs have worked their way around the rules. Recently there have been a couple of deaths of people involved in pyramid schemes which led to protests and an investigation. A few different Chinese government agencies have been tasked with shutting down MLMs.

Analysis here on a legal website based in China.

South China Morning Post article on arrests being made.