Where to begin, perhaps with the link.
I found that site through Rod Cook, a man who has done much work that I respect, he seems to have included it in his "MLM Lies and Myths" category under the heading of Good MLM's Under Attack by Anti-MLM Coalition. I can see his point, after all the International Coalition of Consumer Advocates (ICCA) do themselves refer to this as a Global Anti-MLM Petition. I believe that phrasing to be unfortunate for more than one reason. Rod Cook holds himself out as the MLM Watch Dog and the fact that I don't agree with everything he says will never subtract from his many good efforts to reform the industry from within.Summary of Petition
The signers of this Petition ask the Federal Trade Commission and other federal and state governmental agencies to investigate the Multi-Level Marketing (MLM) industry and take action to protect people. The MLM industry has proven incapable of regulating itself, is rife with fraudulent and deceptive earnings claims and has caused – and will continue to cause – untold financial harm and social disruption to people who are seeking a legitimate business opportunity. It is not enough to prosecute a few MLM companies after they have had years to deceive hundreds of thousands of participants out of hundreds of millions of dollars, most of which will never be recovered. There should be laws and regulations that require full disclosure of material facts by MLM companies and their high level distributors, and which prohibit MLM compensation plans that reward unlimited recruiting of new distributors over personally retailing products to non-participants.
I have never been an affiliate of any multilevel marketing company nor do I ever expect to be one, it quite simply is something outside of my interests or skill set. But I do believe that honest and ethical people can and do earn a respectable livings in MLM. I also believe that some dishonest and unethical people earn hand over fist money in it. For this reason (and others) I don't attack the business model itself but rather the abuses of that model, however I admit there are weaknesses in my approach.
The "MLM Industry" as it functions in the United States is not only unable to regulate itself, it's unwilling to do so. Worse than that it seems from an organizational standpoint the industry is willing and able to counter efforts to have regulation imposed on it from outside. I can't tell you how many times I have seen people who presume to be leaders in the industry speak of ethics and integrity, of holding the best interests of the low level affiliate base as a prime directive only to see those same leaders ignore those principles when they in any way become inconvenient or when profits are at stake. There simply is not, nor is there ever likely to be a well funded political lobbying effort to advocate for needed consumer protection laws pertaining to MLM while there are well funded interests who can pay for political influence to avoid such legislation.
I have strange reading habits, this much is sure but if you have an hour or so to kill take a look at this counterclaim. It is (yet another) internecine MLM legal battle that I wish were less common than they are, just another MLM Leader, someone who can swing a downline from one company to another and does so just as often as a sufficiently lucrative offer can be made, breaking contracts and promises and none of it is new or in any way news. My thoughts are these, the court has not yet settled the facts in this case and no matter how those facts are disposed, there are hundreds or thousands of low level downline members here who are the real victims and the complaint doesn't even make mention of that fact.
I honestly wish the ICCA had not framed this petition as "Anti-MLM." The overwhelming majority of the people this petition hopes to protect are themselves Pro-MLM or MLM professionals, this is to me a very important point to make. I am stridently anti-scam and while I despair from the flagrant, frequent and seemingly omnipresent abuses of multilevel marketing but the business model isn't per say the problem. The problem is that the overwhelming majority of people who have been victimized by fraudulent MLM are silent and therefore see themselves as isolated. The problem is that no matter how good the product is or how equitable a comp plan may be, the people who can recruit (and recruit, and recruit) will always make the most money. The problem is that MLM companies have and always will sell products only as a distant second to selling a income opportunity dream. When enough of the income from that opportunity comes from one time or short time sign up fees and associated expenses paid by people buying into a dream, how realistic that dream is for them will always be a distant second to their ability to pay for that dream. Not to the people paying for it but to the people (and industry) profiting from selling it.
In short, the people with the most influence in any MLM company are the people who are master recruiters. It's been said that comp plans drive affiliate behavior and that is true, but it's more true that comp plan are written by the people who stand best to benefit from them. There are only two forces which could compel the people writing a comp plan to make it fair for the rank and file affiliate base, their ethics and the law. Multilevel Marketing as we see it today IS the product of the ethics of the people running the companies which is the only argument that needs to be made for much stronger and more sensible regulation of this industry. I do not agree 100% with this petition, but the direction it is a step to is far better than the industry's current trajectory.