Thursday, July 21, 2016

Watch Out USANA, The FTC Settlement With Herbalife May Collapse The Entire Multilevel Marketing Industry.

After years of investigating, on July 15, 2016 the FTC announced a settlement with Herbalife. The FTC complaint charges that Herbalife participated in Unfair and Deceptive Acts or Practices in violation of Section 5 of the FTC Act, 15 U.S.C. § 45 by promoting a compensation structure that causes or is likely to cause harm to distributors, by making unsubstantiated claims about retail sales income earned by distributors, and by providing distributors the means to engage in fraud. Herbalife must pay $200 million in consumer redress and is ordered to restructure its business model as part of the settlement deal. While many in the media have claimed victory for Herbalife, it may be the critics that have claimed MLMs are pyramid schemes with no retail demand who actually have the last laugh.

Those MLMs with little retail demand for their products will collapse due to the new required rules for MLMs to abide by. MLMs must now be driven by retail sales, otherwise commissions will be reduced to lower levels. This means the top 1% of distributors who have large downlines will be taking a significant cut in their commission because the downline's personal purchases that don't get retailed to customers are not worth as much in commission anymore. This rule was made because distributors were primarily being rewarded for recruiting new distributors (whom end up being required to purchase product every month to participate) rather than for selling product to retail customers. I look forward to the eventual collapse of the MLM pyramid schemes and I thank the FTC for proving my arguments over the past decade to be correct.

Federal Trade Commission v. Herbalife International of America, Inc. - Stipulation To Entry of Order for Permanent Injunction and Monetary Judgement (Court Document)

Statement of the Federal Trade Commission - FTC v. Herbalife International of America, Inc. - July 15, 2016

Herbalife Will Restructure Its Multi-level Marketing Operations and Pay $200 Million For Consumer Redress to Settle FTC Charges
Company Must Tie Distributor Rewards to Verifiable Retail Product Sales And Stop Misleading Consumers about Potential Earnings

22 comments:

  1. Wow, finally have something to say after 6 months ..but it's still not about usana. it's about herballife. I don't see herballife in this url.

    Affecting herballife will not affect usana. It's like microsoft and apple. microsoft in trouble does not mean apple is in trouble even if it means they are both in the same industry.

    Watch. You watch and I watch you til you are not here anymore. Amway still exist..so what is yo point. 1 down doesn't mean whole industry is down. get a grippo.

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  2. Thank you for your hard work.

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  3. Please keep doing what you do. I know people who are trapped.

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    1. what is s/he doing? If anything it's the government who is doing it. Not doggie. Stop giving credit when it's not duedue.

      I don't think this site does anything to stop usana. Plus that is herballife, not usana. Do you even understand how long it will even take down the whole MLM industry? Probably never because it violates the US constitution. It's freedom. that is what made America great! The most they could do is make more restrictive laws, which usana and other mlm company can modify to go around the law. Like that 70/30 recruit/retail income law.

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  4. Get ready, in a few weeks its Usanas biggest payday, ooops I mean International invention. All top leaders licking their chops at the elite bonus they will get. Oh and supposedly Usana going to revolutionize vitamin industry. Guarantee you this, that what ever revolution they are talking about, will cost customers greatly.

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  5. You know what is the problem I had with usana or more like MLM in general. It's the constant 'peppering' of the uplines to try to go to meetings or any meetings. When I mean peppering, I don't mean like every 5 minutes. It's like every other day trying to get you into meetings which you don't really want to go because they are do they same thing which is motivational sh-t for like 4 hours. Peppering is the same as being pushy as in can't accept no for an answer. But they don't like to be call pushy so you can say they are relentless trying to make you go to meetings. Geez, imagine a man kept doing that to a woman when the woman say "no, I don't want to have sex" but finally 'consent' do to invisible pressure. What do you call that? It's call rape or even if it's not call rape there is a feeling of guilt or regret. So it's no different than rape for those uplines who kept pushing their downlines or other potential recruits to go to these meeting when the downlines say no like two times. SMH. And then you have these people who end up saying no, and the upline is probably talking behind their backs and saying/thinking you will regret it, in a way subconsciously.

    That is another problem I have with them. It's like if you say no, they will want to in a way make you feel bitter indirectly or not, but later on flaunting what they have or just saying what they have. They will deny it but they subconscious will eventually sooner or fking later unless they don't show it. Dude, who da f-k cares. Does someone wealthy flaunt what they have? No? Only insecure people flaunt what they have or try to make a point. So what if you did do well, do I freaking care? No. It's almost like saying you are a prostitute and you are flaunting that you have money that you made it.. but do I or someone on the receiving end care? No. As far as they know, you are a prostitute and you got your money and proud to get your money that way. But I won't and I don't care because I won't be a prostitute. Now change prostitute with mlmers. You get the point.

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    1. OMG. This so reminds me of someone in NY. I don't know if you know her too. Her name is Sufi Chang some. She doesn't know how to accept no as an answer until you have to harshly say NO to her without reason otherwise she will continue to harp why you should go. Then I know that if you don't do it her way, then she will remembers you or don't like you. Sometimes she will start saying stuff behind your back because I saw she did that to others. smh. She is like a two-face. Stay away from that woman because she will take advantage of you once you get too close.

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    2. Ew. Ugh. That woman is so annoying. She will keep trying to convince you and do little things for you to seem like she is nice until you feel like you have to do her a favor and feel bad if you didn't. Then she will keep pointing out that she did that favor for you to remind you so that you will feel bad if you say no in the future. Shutters just thinking of it.

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    3. I actually have known Sufi Chang before she became obsessed with (or possessed by) USANA. I would suggest anybody regardless of the fact that they are her downline or not, to be wary of her and keep the relationship with her at a distance or at a minimum. She seems like an alright person if you are just an acquaintance. But once you become close to her or she knows enough information about you, she will use those info to her own advantage or use you, without you knowing until it starts to annoy you. By then, I'm sure you probably already had done a few favors for her.

      Again, that is how her real person is regardless of USANA. So I can imagine how she will use that same personality in USANA. I will not be surprised if she used her downlines or any new recruits for her own selfish promotion while claiming that she is "helping" you. She is also infamously known among her friends or ex-friends to be very late all the time as she thinks many things must revolve around her. Usually that happens to people whom she already think she has control over or someone whom she thinks that doesn't have as much benefit or her to gain. You just have to keep pushing her to be on time! Just ask anyone who knows her personally well enough about her tardiness and they will agree.

      From what I heard, she lost a lot of friends over USANA (not that much are close anyways to begin with because the ones who knew her already stayed away from her) because they found out how her person really is. So now it's pretty much only friends who are actively engaged in USANA. Sadly without USANA, she has no real friends. Note that I'm talking about her, not her husband, David, who is OK. I know some of her downlines quit because of her controlling personality, not because they aren't doing well or wasn't trying. But by the time those people found out how she really is up close, they already had spent too much money on that mlm by doing things like switching downlines for her or buying additional products so she can optimized points and her own promotional status. They basically lost interest and confidence in her as a person and the mlm because of her.

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    4. damn..someone must pissed someone off to expose the truth and nothing but the truth.

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    5. I know that annoying woman. She is exploiting USANA'S compensation system semi-illegally. But USANA is so clueless that they don't know what she is doing. I know because I have inside information about her method.

      Sufi Chang is using fake accounts with fake social security number, expired associates’ accounts and downlines' addresses. That's why she seems to be a top sponsor many times and able to get the products cheaper to undercut others. Let me break it down for those who are confused and uninformed, like USANA:

      1) Uses fake accounts for temporary gain, but long term benefit.

      When she is just short of maxing out one of her business centers or trying to reach next milestone, she will start adding "new recruits" whom are actually past quitted associates because she kept their info. She might even use any random ppl's identity if she can and put them as "new recruits" without their consent. Yes, it's almost like identity theft. But you can’t trace it because she convince her downlines to do it for her under their name so that Sufi, herself, will be untraceable in case of any investigation from USANA. Talk about sneaky and evil. Sometimes the SSN number and name are changed slightly. That way the stupid USANA system cannot detect it. By the time IF USANA does happen to figure it out, acct is canceled because she just needs them for 2 or 3 months to hit her own target. The long term benefit is that she attains a new level which means more money due bonus sharing and also event hosting and speaking for leaders. Then rinse and repeat randomly so it's not obvious.

      2) Uses other people’s addresses

      In combo of fake names, she uses downlines' addresses so that the orders during the new account will be sent to those addresses where she can get them later. Again, all this is done this way to avoid detection so that she is not linking herself to the new accounts nor the addresses. She probably snitched on some previous top associate for doing the same thing because that associate was her crossline and undercutting the prices. She is able to snitch easily because Sufi is better at people manipulation. I know she tries to bond with a few USANA's staff such as Lori Truman, USANA's Field Development VP because in case anything, it’s easier to get things done to her advantage. Lori probably isn’t aware of this either. USANA will probably need a group to thoroughly investigate her past activities or put a watch on her activities to notice things since she is careful about it.

      3) Uses downline for purchases and resell those products she got as new recruit discount illegally.

      Since she got those products at deep “new recruit” discount, she can chooses to maximize the profit or undercut others without a lost. She buys A LOT of stuff using these same illegal method all distributed to different downlines using fake accts, so that she can resell them to China. So if she has a big order, the trick is to add a fake recruit under her downline, who doesn't know it's fake and let them sponsor it, but uses the downline’s credit card number for the time being. Fake account then gets cancel after 3 months. Nothing is illegal about maximizing profit, but the fact she uses those fake accounts to do this is illegal by USANA standards.

      So I'm surprise USANA still haven't catch or even be suspicious of her considering that it's a big company which should be more sophisticated. Maybe they don't have evidence because Sufi knows that some got ratted out in the past, so she is more careful to try to avoid getting caught, because all these methods were tried and used by some other top Chinese associates in the past. It's just that they aren't as careful as she is. Maybe because USANA only care about money and let associates do whatever they want as long as USANA is making money. No wonder why the MLM industry has such a bad reputation.

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    6. Is it possible that this Scheme to sign up a vast amount of fake accounts in order to rise in the ranks and ultimately reap the rewards of the leadership bonus, is what the current investigation in China is all about?

      How many accounts do you believe are "Fake" accounts?

      If these fake accounts account for a substantial percentage of "Active Associates" as reported by USANA in their SEC filings, this could have a definite impact on their stock price as their reported customer base is inaccurate and misleading.

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  6. This might truly be the dumbest analogy ever posted on here.

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    1. Oh shut up. You know it's true. That's why you have to defense against what I said other than 'dombest analagy..blah'.

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    2. Comparing usana to forced sex is without a doubt Dumbest analogy ever. With a capital D! And by the way not defending Usana at all as I know business model is heavily flawed.

      Btw - think Usana watchdog has given up their quest to take down Usana.

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    3. I think doggie lost this war.
      so disappointed in you doggie.
      after all these work and usana
      still exist and going stronger.

      Doggie. what have you been doing with your life.

      Yeah, herbal first and then usana... but herbal life still exist and usana still here
      and donald trump support MLM. So I wonder how old you will be before you give up. Are you still htere? Are you still alive?

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    4. I dont think he failed though. As long as there is one person planning to join USANA or an MLM and backs out because of this blog, then this blog is serving its purpose.

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  7. FYI, USANA products gave me my life back. I used them for years before adding them to my health coaching business. The science is there. The proof is in the results. Plus, you do not have to sign anyone up as an associate to make commissions or retail profit. Some of the top earners only sell to satisfied customers. I'm guessing someone you know who is associated with USANA really made you angry for you to dedicate a whole blog to casting incorrect doubt.

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  8. Usana must have terminated watchdogs employment. Nothing bad to report in over 8 months.

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  9. wow. Been like almost a year and no updates on usana, huh. I guess you gave up
    or admit that it's a good company
    or can't find sht on the company.
    or usana last longer than you and it's still here.
    might as well stop spending money monthly to maintain this site.


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    1. Are you that dumb? Blogspot is free to maintain, not everyone pays money to be involved in a scam ;) some people are smart enough to find real businesses, real jobs, free hosting... :)

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