The FTC Says Most Amway Recruits Who Joined After 2020 Lost Money

What the FTC alleges

The FTC and the State of Washington filed a complaint against Amway and two of its affiliates, World Wide Group and Leadership Team Development. The complaint alleges that the affiliates told prospective recruits they were likely to earn substantial income, exceeding $40,000 a year.

The FTC's central allegation is about results, not just promises. According to the complaint, most people who joined WWG or LTD after 2020 spent more money on Amway products and training than they received from Amway.

These are allegations in a proposed settlement, not findings from a trial.

What the proposed order requires

According to the FTC, the proposed order requires participants to sell to others at least 70% of the products they purchase from Amway each month. It also bars approved recruiting groups, including WWG and LTD, from charging new participants for any training or services during their first year.

The order is limited to Amway and these affiliates. It does not set rules for the MLM industry as a whole.

Why the settlement matters beyond this case

The FTC describes the $225 million figure as the largest monetary recovery in an FTC action against a multilevel marketing company. Amway reports more than 290,000 Independent Business Owners, so the case affects a large group of people.

The complaint's core allegation, that recruits spent more than they earned, is the reason the case matters to anyone considering a recruiting program. The income claim is what recruits hear before they join, which is why the complaint focuses on it.

What to actually do about it

Before joining any recruiting program, ask for its published earnings data for the typical participant, not the top earners. Ask how much a new participant is expected to spend in their first year, including product, training, and fees. If the company does not have that data in writing, treat the absence as the answer.