If your direct selling company has a multilevel compensation plan, it is in your best interest to be aware of the recent FTC actions against Vemma (August 2015) and Herbalife (July 2016) because your company and your compensation plan may have some of the same problems. Watch this video now to learn why these FTC actions…
Should Party Plan Companies Worry About FTC Actions?
Most of the sales of products by party plan companies are made to people who are not consultants. In 2015 and 2016, the Federal Trade Commission (FTC) filed orders against Vemma and Herbalife, each of which is a network marketing company. One of their concerns was the lack of customers who were not representatives themselves. Another…
The Cooling-Off Rule: How It Applies To Your Company
As a direct selling company, you need to know about the Federal Trade Commission’s Cooling-Off Rule. There are very specific steps you must follow to be in compliance with this federal law. To learn more about how the Cooling-Off Rule applies to your company, watch our video below. How To Comply Most direct…
Legally Speaking: How Many Real Customers Do You Need?
No, this is not a joke title. One of our prospective clients recently asked me how many “real” customers he needed. He asked me this question as he was familiar with the Federal Trade Commission’s actions against Vemma in 2015 and Herbalife in 2016, each of which required sufficient volume from customers who were not representatives…
Ask Victoria: What Is The Cooling Off Rule?
As a direct selling company, you need to know about the Federal Trade Commission’s Cooling-Off Rule. There are very specific steps you must follow to be in compliance with this federal law. It’s All About Changing Your Mind If a customer buys something at a store and later changes his or her mind, the merchandise…
FTC Closes Fortune Hi-Tech Marketing
The Federal Trade Commission (FTC) works for consumers to prevent fraudulent, deceptive, and unfair business practices. Section 5(a) of the FTC Act, 15 U.S.C. § 45(a), prohibits unfair or deceptive acts or practices in or affecting commerce. Misrepresentations or deceptive omissions of material fact are deceptive acts or practices that are prohibited by Section 5(a)…
New FTC Business Opportunity Rule
This month, I attended the 2012 Global Regulatory Summit held by the Direct Selling Association in Washington, DC. It is an annual event attended primarily by lawyers and employees of direct selling companies who are responsible for legal compliance. In March 2012, the Federal Trade Commission or FTC promulgated a significant new Business Opportunity Rule known as…
What Is A Pyramid Scheme?
Pyramid schemes are clearly illegal, but what exactly is a pyramid and what is not? In the United States, the Federal Trade Commission is one of the governmental bodies that have the power to shut down pyramids. According to the FTC, one sign of a pyramid scheme is if distributors sell more products to other…
MLM Legal: Be PRO(active)
The laws governing the network marketing industry are a complex tapestry involving state and federal statutes and an array of regulations. With all of the legal requirements, it’s not easy for companies in the industry to safely navigate the terrain. Based on my study of the law and countless cases, if a…
Social Media and the FTC
Social media is not going away anytime soon. How should we use it to help us, not hurt us? Out of Control You may have heard horror stories about social media being used by representatives to inaccurately promote income opportunities or products. Unhappy distributors or customers sometimes express their grievances publically for all to see. …