Case 2:26-cv-03474

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Case 2:26-cv-03474

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UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF WASHINGTON

FEDERAL TRADE COMMISSION, and

STATE OF WASHINGTON,

Plaintiffs,

Case No. ____________

COMPLAINT FOR PERMANENT

INJUNCTION, MONETARY

JUDGMENT, CIVIL PENALTY

JUDGMENT, AND OTHER RELIEF

AMWAY CORP., also doing business as AMWAY

NORTH AMERICA, a Virginia corporation,

WORLD WIDE GROUP, L.L.C., a Washington

limited liability company, and

LEADERSHIP TEAM DEVELOPMENT, INC., a

North Carolina corporation,

Defendants.

COMPLAINT - 1

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FEDERAL TRADE COMMISSION

One Bowling Green, Suite 318

New York, NY 10004

(212) 607-2829

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TABLE OF CONTENTS

SUMMARY OF THE CASE .............................................................................................. 5

II.

JURISDICTION AND VENUE ....................................................................................... 11

III.

THE PARTIES.................................................................................................................. 12

PLAINTIFFS ........................................................................................................ 12

DEFENDANTS .................................................................................................... 12

IV.

COMMERCE.................................................................................................................... 13

DEFENDANTS’ BUSINESS ACTIVITIES .................................................................... 13

BACKGROUND ON AMWAY AND ITS APPROVED PROVIDERS

AND IBOS ............................................................................................................ 13

Amway And The Products Purchased By Its IBOs .................................. 13

Amway’s Control Over And Oversight Of Its Approved Providers......... 16

Amway’s Largest Approved Providers: WWG And LTD ...................... 19

The Leaders Of The Approved Providers Split The Profits From The

Training They Sell IBOs And Claim Is Essential For Success ................. 20

AMWAY’S AND THE APPROVED PROVIDERS’ DECEPTIVE

REPRESENTATIONS ......................................................................................... 26

The Deceptive Process For Recruiting New IBOs ................................... 26

The Deceptive Claims That Being “Core” Will Practically Guarantee

Substantial Income And That Recruiting New IBOs Is Easy ................... 32

Overview Of Amway’s System Of Bonuses And “Pins” ......................... 23

Median Annual Bonuses For IBOs Before Expenses Are Just A Few

Hundred Dollars ........................................................................................ 37

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AMWAY INCENTIVIZES AND THE APPROVED PROVIDERS PRESSURE

NEW IBOS TO DO THE SAME ......................................................................... 46

Impossible ................................................................................................. 46

The Approved Providers And IBO Leaders Tell IBOs To Focus On

Recruiting Instead Of Customer Sales ...................................................... 49

The Approved Providers And IBO Leaders Tell IBOs To Buy Amway

Products Themselves In Order To Build Their Business.......................... 57

Amway’s Awareness Of Its Approved Providers’ Promotion Of The SelfConsumption Business Model .................................................................. 64

Amway’s Compensation Plan Incentivizes Recruiting IBOs And

Obtaining Substantial Bonuses From Product Sales Alone Is Virtually

The Deceptive Pitch For Side Income Of A Few Hundred Or A Few

PURCHASE, FAKE SALES TO PURPORTED CUSTOMERS, AND RECRUIT

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IBOS TO BUY AMWAY PRODUCTS THEY WOULD NOT OTHERWISE

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Thousand Dollars Annually ...................................................................... 43

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Amway And The Approved Providers’ Recent Efforts To Hide The

Personal Consumption Model ................................................................... 68

VI.

VIOLATIONS OF THE FTC ACT .................................................................................. 75

VII.

VIOLATIONS ALLEGED ............................................................................................... 75

COUNT ONE – UNFAIRNESS ................................................................................................... 75

COUNT TWO – MISREPRESENTATIONS REGARDING EARNINGS

AND RECRUITING ......................................................................................................... 76

COUNT THREE – MISREPRESENTATIONS REGARDING SERVICES PROVIDED ......... 77

COMPLAINT - 3

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COUNT FIVE – VIOLATIONS OF CONSUMER PROTECTION ACT

(WASH. REV. CODE § 19.86.020 / DECEPTIVE ACTS AND PRACTICES) ............. 78

COUNT SIX – VIOLATIONS OF CONSUMER PROTECTION ACT

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COUNT FOUR – MISREPRESENTATIONS REGARDING CUSTOMER SALES ................ 77

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(WASH. REV. CODE § 19.86.020 / UNFAIR ACTS OR PRACTICES) ....................... 80

VIII.

CONSUMER INJURY ..................................................................................................... 81

IX.

PRAYER FOR RELIEF ................................................................................................... 81

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Plaintiffs, the Federal Trade Commission (“FTC” or “Commission”) and the State of

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Washington (“State”), for their Complaint allege:

The FTC brings this action for Defendants’ violations of Section 5(a) of the FTC

Act, 15 U.S.C. § 45(a). Defendants promote and operate an unfair and deceptive direct selling

and multi-level marketing opportunity. For these violations, the FTC seeks relief, including a

permanent injunction and other relief, pursuant to Sections 5(a)(1) and 13(b) of the FTC Act, 15

U.S.C. §§ 45(a)(1), 53(b), against Defendants Amway Corp., World Wide Group, L.L.C., and

Leadership Team Development, Inc.

The State brings this action for Defendants’ violations of the Washington

Consumer Protection Act, Wash. Rev. Code § 19.86 (“CPA”). For these violations, the State

seeks relief, including injunctive relief, civil penalties, restitution, and other relief, pursuant to

the CPA, Wash. Rev. Code §§ 19.86.080 and 19.86.140, against Defendants Amway Corp.,

World Wide Group, L.L.C., and Leadership Team Development, Inc.

SUMMARY OF THE CASE

Amway Corp. (“Amway”) offers a money-making opportunity in the United

States that it claims gives people the chance to own and operate their own business selling

consumer products. Consistent with this positioning, Amway uses the terms “Independent

Business Owner” or “IBO” to describe consumers who sign up for Amway’s multi-level

marketing program. Despite its claims that IBOs can make money by selling Amway products to

customers, Amway’s products are priced at premium levels and therefore are difficult to sell to

non-IBOs. As one of Amway’s highest-ranking executives put it in a slide presentation he

prepared in 2019, IBOs who are new find that “[s]elling to customers is not rewarded, not taught

by leaders and difficult.”

In Amway, new IBOs are recruited into the business by existing IBOs, who

typically require their recruits to also join groups affiliated with Amway. These groups sell

training to IBOs that the recruiters and IBO leaders of the groups claim is essential to becoming

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a successful IBO. The training groups do not teach IBOs that selling Amway products to

customers is the key to making money in the Amway business. Instead, they instruct IBOs to

buy a set amount of products each month, regardless of whether the IBOs can resell or actually

want them, in order to generate points that are used in calculating what Amway calls “bonuses”

that it pays to both the IBOs who purchase Amway products and the IBOs who recruited them.

As one IBO leader put it in a January 2023 training session for IBOs, “We’re rich because we’ve

always used our own products.” The IBO leaders of the training groups also instruct new IBOs

to try to recruit more people into Amway and to tell them to buy a set volume of products from

Amway each month in order to make money. This practice is known as “duplication” because

new IBOs are supposed to duplicate the purchasing patterns of the IBOs who recruited them.

The result of these directives is that Amway’s IBOs buy most of the company’s

products themselves. In recent years in the U.S., Amway has sold more than three-quarters of its

products to its own IBOs. Most IBOs, however, stop pursuing the business once they realize the

monthly cost of purchasing Amway’s pricey products usually exceeds any “bonuses” they

receive. When they leave Amway, the vast majority of IBOs stop buying Amway products

altogether, as they are no longer trying to generate points used in determining bonuses. Much of

the Amway business, therefore, is driven by selling products to IBOs who are buying them to try

to make money through recruiting and duplication, as opposed to selling products to customers

who genuinely want them.

In 2019 and the early 2020s, Amway began making a series of changes to its

business, but these changes were superficial and did not meaningfully change how Amway

operates. The centerpiece of this effort was designed to thwart any government investigation

into Amway’s business model by making it appear that most of Amway’s products were

eventually sold to customers. To accomplish this, in early 2021, Amway expanded a system for

IBOs to report that they resold products they purchased to customers, which Amway’s own

employees characterized as “easy to manipulate.” Around the same time Amway told the leaders

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of its training groups that it would restrict their bonuses if they did not help the company

generate purported customer sales “data” for the company. Thereafter, on a widespread basis,

the leaders of groups that sell training to IBOs told their members to falsely report that they

resold most of their product purchases to customers or to use other methods to fake customer

sales.

While many IBOs complied with these directives, the false reports of customer

sales they provided to Amway have not changed the true nature of the business. Amway and the

training groups still incentivize and encourage IBOs to buy Amway products, regardless of

whether they want them or can resell them to customers, and to recruit new IBOs to do the same.

Accordingly, Amway operates and the training groups promote the Amway multi-level

marketing business in an unfair manner, which results in IBOs and their recruits purchasing

Amway products for reasons other than genuine demand for them in a near-futile effort to make

money while faking their customer sales.

***

In recent years, young adults have been the principal targets of Amway recruiters,

and many of them have incomes below $50,000 a year. Like many deceptive money-making

opportunities, Amway is pitched to prospects as a way to avoid the drudgery of working a

traditional job for decades. Prospects are told that running an Amway business will likely

replace the income from their full-time job, ensure they can spend more time with their family,

and even make them enough to allow them to retire at a young age. To do so, prospects and

IBOs are told they simply need to take the business seriously and follow a purported “system”

for success developed by certain high-ranking IBO leaders for a few years. As Brad Duncan, the

IBO leader of the largest training group put it in a May 2021 talk to IBOs, “[I]t’s the simplest

thing in the world. … [Y]ou’re all going to be living in the most beautiful homes in the world, I

will promise you, if you will treat this like a business. I promise.”

In the U.S., most people who sign up for Amway are recruited by IBOs who are

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members of training groups, which Amway calls “Approved Providers.” As the name implies,

Approved Providers are authorized by Amway to recruit new people into Amway and then sell

them “training” that includes audio recordings, live events, and subscriptions to phone apps.

Amway has rules that outline how Approved Providers and IBOs are allowed to recruit and train

new IBOs, which the Approved Providers regularly violate. Amway executives are well aware

of this fact, but the company does little to police violations relating to deceptive claims that the

IBO leaders of the Approved Providers make to prospects and IBOs. Since Amway relies on the

Approved Providers to recruit new IBOs to buy Amway products, Amway benefits from these

deceptive claims.

10.

Two of the largest Approved Providers in the U.S. are World Wide Group, L.L.C.

(“WWG”) and Leadership Team Development, Inc. (“LTD”). Although they are based on

opposite coasts, WWG and LTD recruit in similar ways and provide similar training to IBOs.

WWG and LTD are owned and controlled by a small number of high-level IBOs who split the

profits from the training sales with the IBO leaders of each group. These leaders also pressure

IBOs to buy the training and tell IBOs it is essential to making money in Amway.

11.

To entice people to sign up with Amway, WWG and LTD IBOs use a variety of

deceptive tactics. Instead of being told about Amway, its products, or a multi-level marketing

opportunity, many prospects are initially lured in with deceptive claims about an exclusive

opportunity to be mentored by a person or couple who made so much money they were able to

stop working in their 20s or 30s. The opportunity is deliberately described this way to allow the

IBO recruiter to obfuscate when asked what the opportunity is by saying the answer is something

the person or couple needs to explain to the prospect, among other things.

12.

In recent years, for example, multiple IBO leaders in WWG have instructed IBOs

to tell prospects they “connected with a couple that were able to walk away from their jobs at 28

& 33. That blew our minds so we pursued them & convinced them to spend some time with us.

As a matter of fact they agreed to take us under their wing. And right now they are in the

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process of coaching and mentoring us … so we can accomplish similar results in our life so we

can stop sacrificing our life for a job.” Contrary to these claims, few IBOs are directly mentored

by anyone that successful. Rather, their mentors are typically other IBOs trying to make money

in Amway, who work traditional jobs or their Amway business. Moreover, the opportunity is not

an exclusive one, and anyone who follows the instructions of their recruiter during the recruiting

process gets an “offer” to join Amway and an Approved Provider.

13.

Amway authorizes its Approved Providers to present the business as a way to

make $40,000 a year, and groups such as WWG and LTD tell prospects that if they follow their

special system for running an Amway business, they will likely make that much or more. For

example, in a March 2023 online training, a WWG leader, Maiko Tuitupou, told IBOs that if

they developed a “consistent work habit … it’s not a matter of if, it’s a matter of when” they will

achieve the levels associated with mid-five figure annual bonuses. Similarly, in a January 2025

training in Kansas City, Missouri, an LTD leader claimed a young IBO had built a six-figure

Amway business just by following the “recipe” for success: “This works. This is a man who

just followed the recipe of” recruiting and generating product volume “for a couple years.”

14.

In fact, most IBOs come nowhere near the dollar figures that appear in the

Approved Providers’ slide presentations for prospects, which are approved by Amway. In 2023,

for instance, median total bonuses (before expenses) for IBOs were only $139, and IBOs often

spend more on training they buy from Approved Providers than they receive in bonuses. Among

IBOs who joined WWG and LTD between 2020 and 2023, average and median bonuses were

less than the average and median amounts they spent on training through March 2024. In

contrast, only about 1 percent—fewer than 1,600 IBOs out of more than 241,000 IBOs—

received $40,000 or more in bonuses from Amway in 2023.

15.

Amway’s main product lines are nutritional supplements, energy drinks and bars,

and makeup and skin care products. All of these products compete in crowded markets with

numerous alternatives, and most of them have premium pricing. For example, a case of water

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from Amway, which is one of the most frequently purchased products by IBOs, costs them more

than $45. IBO leaders in WWG and LTD tell IBOs that the easiest way to generate points for

bonuses is to buy Amway’s pricey products for themselves, regardless of whether they like them

or their cost. In June 2022, for instance, one IBO leader told IBOs in a training session that

when she started in Amway, its energy bars came in two flavors, “yuck and yuckier,” but she ate

them anyway because it “created volume.” Similarly, other IBO leaders have instructed IBOs to

buy products for their point value while adding that they “never cared” how much Amway

products cost and “don’t care” whether they “taste[] good” or are better than their competitors.

16.

In Amway, as in other multi-level marketing businesses, anyone an IBO recruits

is referred to as part of their “downline,” along with anyone those recruits are able to recruit as

well as the recruits of those recruits and so on. Consistent with the incentives in what Amway

calls its “compensation plan,” the Approved Providers tell prospects and IBOs to try to make

money by recruiting people into the business because IBOs’ bonuses increase when their

downlines buy Amway products. More specifically, when IBOs buy Amway products, such

purchases typically generate points that flow “upline” to the IBO who recruited them, and then

from that IBO to the next IBO further up the recruiting chain and so on.

17.

In recruiting and training presentations, WWG and LTD tell prospects and IBOs

to recruit 6 to 12 IBOs themselves and to help those new IBOs to recruit as well. According to

these standardized presentations, which Amway approves, IBOs who build a team of 25 to 48

IBOs will have “earnings” of about $40,000 a year. In WWG’s standard presentation, less than

$1,000 of that sum is derived from retail margin from selling products to customers. The bulk of

the remainder—more than $38,000—comes from points generated by downline recruits. In other

words, in WWG’s own demonstration of how to be a successful IBO, 96 percent of the IBO’s

revenue comes from recruits.

18.

Since recruiting is necessary to obtain substantial bonuses, the leaders of WWG

and LTD also make deceptive claims to prospects and IBOs about the likelihood that they will be

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able to recruit new IBOs. These leaders tell prospects and IBOs that it is “not very hard” to

recruit 6 to 12 IBOs a year, but, in fact, it is very difficult. A majority of IBOs fail to recruit a

single new IBO each year, and the average number of recruits per IBO per year is less than one.

19.

While IBOs are struggling to find new recruits, the IBO leaders of WWG and

LTD also tell IBOs it is essential that they purchase the Approved Providers’ training and

substantial quantities of Amway products each month in order to make money. In 2024, Amway

required its Approved Providers to waive all training costs for IBOs in their first year, but the

annual cost of the main training services for WWG and LTD IBOs in their second year and

beyond ranges from approximately $1,600 to $3,600. Given the difficulty of making more from

their Amway business than they spend on training or products, many IBOs do not stay in Amway

for long, and the Amway business churns through IBOs each year. In the years 2020 to 2023,

between 70,000 and 130,000 new IBOs joined Amway, and over 100,000 IBOs left the

opportunity each year.

20.

These figures are consistent with how the former CEO of Amway’s parent

company, described Amway’s global business in 2020. In a “script” that he “penned” himself

for an internal presentation, the former CEO wrote that the business was characterized by “[p]oor

earnings” for “new” IBOs, “high churn,” and “a vicious cycle- of recruitment and self

consumption” of Amway products by IBOs. In other words, the Amway business relies on

continually recruiting new IBOs to buy Amway products while making little in the way of

bonuses. These realities are a far cry from the deceptive promises made to new IBOs in WWG

and LTD, who are told they are likely to replace the income from their job or even retire early if

they just follow a few simple steps laid out by longtime IBO leaders.

II.

JURISDICTION AND VENUE

21.

and 1345.

22.

This Court has subject matter jurisdiction pursuant to 28 U.S.C. §§ 1331, 1337(a),

This Court has supplemental jurisdiction over the State’s state law CPA claims

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because those claims are integrally related to the FTC’s federal law claims and are part of the

same case or controversy. 28 U.S.C. § 1367(a).

23.

Venue is proper in this District under 28 U.S.C. §§ 1391(b)(2), (c)(2), and (d),

1395(a), and 15 U.S.C. § 53(b).

III.

THE PARTIES

PLAINTIFFS

24.

The FTC is an agency of the United States Government created by the FTC Act,

which authorizes the FTC to commence this district court civil action by its own attorneys. 15

U.S.C. §§ 41-58. The FTC enforces Section 5(a) of the FTC Act, 15 U.S.C. § 45(a), which

prohibits unfair or deceptive acts or practices in or affecting commerce.

25.

The State is the State of Washington, acting by and through the Consumer

Protection Division of the Washington Attorney General’s Office. The Washington Attorney

General has the authority to commence this action pursuant to Wash. Rev. Code §§ 19.86.080

and 19.86.140 to address practices that violate the CPA.

DEFENDANTS

26.

Defendant Amway Corp. is a Virginia corporation with its principal place of

business at 7575 Fulton Street East, Ada, Michigan 49355. Amway transacts or has transacted

business in this District and throughout the United States. At all times relevant to this

Complaint, acting alone or in concert with others, Amway has advertised, marketed, distributed,

or sold the Amway business opportunity, along with Amway products, throughout the United

States.

27.

Defendant World Wide Group, L.L.C. (“WWG”) is a Washington limited liability

company with its principal place of business at 717 S. Pines Road, Spokane Valley, Washington,

99206. WWG transacts or has transacted business in this District and throughout the United

States. At all times relevant to this Complaint, acting alone or in concert with others, WWG has

advertised, marketed, distributed, or sold products and services related to the Amway business

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opportunity and Amway products throughout the United States.

28.

Defendant Leadership Team Development, Inc. (“LTD”) is a North Carolina

Corporation with its principal place of business at 3209 Gresham Lake Road, Suite 153, Raleigh,

North Carolina 27615. LTD transacts or has transacted business in this District and throughout

the United States. At all times relevant to this Complaint, acting alone or in concert with others,

LTD has advertised, marketed, distributed, or sold products and services related to the Amway

business opportunity and Amway products throughout the United States.

IV.

COMMERCE

29.

At all times relevant to this Complaint, Defendants have maintained a substantial

course of trade in or affecting commerce, as “commerce” is defined in Section 4 of the FTC Act,

15 U.S.C. § 44.

30.

At all times relevant to this action, Defendants, and each of them, have been

engaged in trade or commerce within the meaning of the CPA, Wash. Rev. Code § 19.86.010(2).

DEFENDANTS’ BUSINESS ACTIVITIES

BACKGROUND ON AMWAY AND ITS APPROVED PROVIDERS AND

IBOS

31.

Amway And The Products Purchased By Its IBOs

Amway is part of a group of companies that sell consumer products and offer a

multi-level marketing opportunity around the world. The “Amway Corp.” entity, which is also

known as Amway North America, operates in the U.S., Canada, the Dominican Republic, and

many other island countries and has U.S. revenues of about $1 billion annually. According to a

2023 list published by Amway of the “Top Ten Markets” globally for Amway and its affiliates,

the U.S. ranks second, and the other nine markets on the list are in Asia.

32.

Nearly all of Amway’s U.S. revenues are derived from product sales, and the vast

majority of those sales are made to IBOs themselves. In 2023, for example, Amway’s data

indicated IBOs purchased 77 percent of the products sold by Amway. When IBOs purchase

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Amway products, those purchases generate points that are used in calculating what Amway

typically calls “bonuses” or “incentives” that it pays to IBOs (collectively “bonuses”). Although

IBOs can resell products that they buy from Amway to customers, reselling the products does not

generate additional points for IBOs. Rather, IBOs are credited with the point value of each

product when IBOs purchase them from Amway.

33.

As a result, the IBO leaders of the Approved Providers tell IBOs to generate

points by buying Amway products themselves and claim this will help them make money in their

business. These leaders often encourage IBOs to buy a recurring order of Amway products,

which Amway calls a “DITTO,” on the first day of every month. Such purchases are often

referred to as a “Day 1 DITTO.”

34.

Amway sells a wide range of consumer products to IBOs, but the bulk of its sales

come from three main product categories. Vitamins and nutritional supplements, which Amway

sells under the brand name Nutrilite, are Amway’s largest selling group of products and make up

over 40 percent of its sales. Amway’s next two largest product categories are: (i) energy drinks

and bars and (ii) makeup and skincare products, each of which constitutes about 15 percent of

sales. Amway’s energy drinks and bars are sold under the brand name XS, and the makeup and

skincare lines are mainly marketed under the brand name Artistry.

35.

As Amway itself recognizes, many of its products have “premium” pricing and

compete in markets with many competitors. For example, Amway’s own website has a

Frequently Asked Question that asks, “Why Do Amway Products Cost More?” Similarly, a

2022 internal Amway marketing presentation admitted that one key Nutrilite product was

“similar” to another brand that was “priced ⁓80% lower per serving” and that Nutrilite’s main

multivitamin package was priced above the “Premium Benchmark” in a pricing study conducted

by an outside consultant. The presentation concluded that in terms of pricing, the “Nutrilite

brand will remain premium” even though many of the Nutrilite products did not have the

characteristics of its premium-priced competitors: “Many of our core Nutrilite products do not

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contain attributes that drive customer willingness to pay premium or to compete even in mid-

tier.” The presentation also recognized that Nutrilite competes in a “hyper competitive” market

for vitamins and supplements.

36.

Until recently, Amway priced its main multivitamin package, Double X, at $64

for a 31-day supply, and it was one of the top products purchased by IBOs. Another top product

bought by IBOs with premium pricing is bottled water even though it “is not a product with high

retail appeal,” as Amway’s former Vice President of Sales put it. Until recently, Amway priced

a case of water with 24 bottles containing 16.9 fluid ounces at $52. These prices were the ones

offered online to customers, and they effectively served as Amway’s suggested retail price.

When IBOs bought from Amway they received a 10 percent discount off the suggested retail

price. Given the pricing of Amway products and the crowded markets in which they compete, it

is difficult for IBOs to sell Amway products to non-IBO customers. In September 2026, Amway

revised its pricing structure and the prices shown on its public-facing website, but the minimum

suggested retail price is still 10 percent above the prices paid by IBOs.

37.

Amway’s rules generally prohibit IBOs from selling Amway products through

brick-and-mortar stores or non-Amway online marketplaces. Instead, IBOs can try to sell

products to customers in two different ways. First, IBOs can try to resell the products they buy

and receive from Amway to customers. These transactions do not generate additional points for

IBOs. IBOs can set the price at which they resell products, but if they sell at Amway’s minimum

suggested retail price, the gross margin for such transactions is about 10 percent. When IBOs

purchase from Amway, they pay taxes and often pay shipping costs, which means the 10 percent

margin is reduced if they are not able to recover those costs when selling to customers. Second,

IBOs can encourage customers to buy products online from Amway. IBOs get credit for such

purchases by customers who identified the IBOs when registering as a customer or who make

purchases from a unique webpage Amway provides for each IBO. For these online purchases,

IBOs get points from Amway and a portion of the price paid by the customer. Until recently,

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that portion was set at 10 percent, but starting in September 2026, that amount became more

variable.

38.

As discussed further below, IBOs often fake their purported customer sales to

make it appear that IBOs are complying with recently-updated Amway rules. These rules were

the company is a sales organization as opposed to a money-making opportunity in which IBOs

end up buying Amway products they would not otherwise purchase in a near-futile attempt to

obtain substantial bonuses from Amway.

39.

Amway’s Control Over And Oversight Of Its Approved Providers

Amway relies on the IBOs who are members of its Approved Providers to recruit

new IBOs. Prospects cannot simply sign up as an IBO on Amway’s website on their own.

Instead, they need to have an IBO sponsor to register on the website. Although Amway only

began closely tracking Approved Provider membership around 2024 and membership has fallen

since that time, Amway estimated prior to 2024 that most IBOs were members of an Approved

Provider group.

40.

All of the Approved Providers are owned and run by IBOs who have achieved

high levels in Amway’s compensation plan. The larger Approved Providers, such as WWG and

LTD, have offices and full-time staff members, but those groups are still run by their high-

ranking IBO leaders.

41.

Amway has nearly-identical contracts with each of its Approved Providers,

including WWG and LTD. These agreements give the Approved Providers the right to recruit

IBOs and then sell them training in the form of audio recordings, live events, and phone apps.

The contracts include certain “content standards” that outline the permissible and impermissible

ways in which the Amway opportunity can be marketed to prospects and training can be

provided to IBOs. The content standards, which are over 40 pages long, apply to virtually every

type of activity connected to the Amway business, including live events, “meetings,” any

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training that is sold, “person-to-person” interaction, and social media groups. These standards

also apply to IBOs pursuant to separate agreements that Amway enters into with them. In

addition, under Amway’s rules, IBO leaders who share in the revenues generated by the training

sold by the Approved Providers must enter into an agreement with those groups in which they

agree to comply with Amway’s content standards.

42.

Under its agreements with the Approved Providers, Amway has the right to

access their events for prospects or IBOs as well as electronic spaces used by the Approved

Providers with IBOs to determine whether they are complying with Amway’s content standards.

Amway can terminate an Approved Provider for breaches of its agreement, including the

“content standards.” Likewise, Amway can terminate IBOs for violating its standards or an

additional set of rules that are published in Amway’s Business Reference Guide for IBOs. The

rules in that guide provide that Amway can also impose sanctions, such as withholding bonuses,

on IBOs for violations of the rules or content standards.

43.

Pursuant to their agreements with Amway, the Approved Providers are supposed

to submit all of their recruiting and training materials to Amway. These materials are known as

Business Support Materials (“BSM”), and Approved Providers such as WWG and LTD include

certifications with their BSM submissions to Amway that their BSM complies with Amway’s

content standards. Amway reviews all of the recruiting materials it receives, along with all

submissions related to its bonuses, and some of the other BSM.

44.

Amway has the right to approve or not approve BSM. When Amway approves

BSM, it often requires the Approved Providers to edit them before they can be used or sold.

Amway is also aware that the Approved Providers often edit recordings of live events to remove

material that obviously violates content standards before submitting it as BSM, but these

statements have already been heard by the live audience, and Amway rarely takes action to

prevent speakers from repeating statements that violate its content standards in future events.

45.

In addition to reviewing BSM, there are several other ways in which Amway

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employees and executives oversee the Approved Providers and their IBO leaders. Amway has a

group of account representatives, who serve as liaisons between the company and IBO leaders of

the Approved Providers. Members of this group meet with these IBO leaders about their

businesses, discuss their efforts to recruit and retain IBOs, and have access to materials used by

the Approved Providers in recruiting and training IBOs. Members of this group often put

together “action plans” for Approved Providers and their IBO leaders to improve their

businesses.

46.

Amway employees attend Approved Provider events, and Amway executives

regularly meet with the IBO leaders of the Approved Providers who serve as members of the

Board of Directors of the Independent Business Owners Association International, Inc.

(“IBOAI”). Amway also has a contract with the IBOAI, which provides that the IBOAI serves

as a “consultant” to Amway and must be notified of certain changes affecting IBOs in advance.

Amway executives meet with IBOAI leaders multiple times per year to discuss the Amway

business and potential changes to rules, bonuses, and any other aspect of the business. Amway

also invites IBO leaders to certain annual events in which they receive presentations and meet

with Amway executives.

47.

With respect to recruiting events, Amway dictates the dollar amounts that

Approved Providers can present to prospects. In recent years, Amway has authorized the

Approved Providers to claim that IBOs can make more than $40,000 or more than $50,000

annually, depending on the year, even though those amounts are only obtained by about 1

percent of IBOs. Amway has approved the use of these annual figures or their monthly

equivalents in presentation slides, although IBO leaders often discuss higher amounts orally. In

addition, Amway has allowed the Approved Providers to show how IBOs who recruit 6 to 12

IBOs make those amounts even though Amway knows most IBOs fail to recruit a single new

IBO each year and the average number of recruits per IBO each year is less than one.

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Amway’s Largest Approved Providers: WWG And LTD

Since at least the late 2010s, there have been five large Approved Providers in the

U.S. that generated the most product sales for Amway. The Amway product purchases related to

members of those five groups make up about 60 percent of all products purchased from Amway

in the U.S.

49.

In terms of members, WWG and LTD are the two largest Approved Providers in

the U.S., according to the records of the five largest providers. In 2023, WWG had more than

35,000 IBOs, and LTD had more than 28,000 IBOs. Tens of thousands of Washingtonians have

joined Amway and either WWG or LTD.

50.

In recent years, IBOs in WWG purchased more Amway products than IBOs in

any other Approved Provider, and IBOs in LTD purchased the third-most. Since Amway’s

records do not distinguish between IBOs who start its sign-up process and those who finish its

sign-up process, references to IBOs in a given period in this Complaint are to those who bought

or sold an Amway product in that period unless otherwise indicated.

51.

When prospects are recruited by IBOs in Approved Providers such as WWG and

LTD, they typically join both Amway and the Approved Provider around the same time.

Although Amway does not require IBOs to join an Approved Provider, those groups present the

business in a way that makes it clear that prospects are expected to join both Amway and the

IBO’s Approved Provider.

52.

Although WWG and LTD operate throughout the U.S., WWG’s presence is

strongest in the West and on the West Coast, and the headquarters where its staff works is in

Spokane Valley, Washington. WWG, which used to be known as Worldwide Dreambuilders, is

owned by more than 25 IBOs who are members of WWG and have reached the level of

Diamond or above in Amway. Diamond is a very high-level rank in Amway’s multi-level

marketing structure.

53.

Since the late 2010s, the undisputed leaders of WWG have been Brad and Julie

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Duncan, who reached a level above Diamond that is known as “Crown.” The Duncans run their

Amway business together from the Las Vegas, Nevada area, as Amway rules require married

couples to pursue their business as a single IBO.

54.

In recent years, several WWG Diamonds and other IBO leaders have lived in the

Seattle area. As a result, many of WWG’s monthly and quarterly meetings and training events

have been held near Seattle. Venues range in size from arenas like the Tacoma Dome to the

Lynwood Convention Center to hotel meeting rooms.

55.

LTD’s headquarters for its staff is in Raleigh, North Carolina, where the Diamond

couple that owns LTD and other leaders of the group live. LTD’s presence is strongest in the

South and Midwest, and it has a small management group of Diamonds that includes a Diamond

who is also a member and former Chairman of the Board of Directors of the IBOAI. In recent

years, seven or eight of the 15 IBOAI Board members have been Diamond IBOs in WWG or

LTD. According to LTD, there are over 25 U.S.-based Diamonds in LTD.

The Training They Sell IBOs And Claim Is Essential For Success

The Leaders Of The Approved Providers Split The Profits From

56.

All of the main Approved Providers claim to have a “system” for success in

Amway, and IBO leaders continually tell IBOs their success is practically inevitable if they

follow it. In WWG and LTD, this system is called being “Core.”

57.

Most of the various steps of being Core in both groups involve (a) purchasing

Amway products, (b) buying training or related services from the Approved Providers, or

“Steps” in LTD. The Core Habits and Core Steps are very similar, and a majority of them relate

to buying training from WWG or LTD.

58.

The IBO leaders of WWG and LTD split the profits from the training those

groups sell to IBOs, and the payouts to leaders are based on the size of each leader’s downlines.

While IBO leaders try to hide the fact that they make money off the training, they claim that

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buying training is essential to making money in Amway. These claims often take the form of

telling IBOs that being Core will practically guarantee success, and many of the training events

themselves consist of leaders talking about how each step of Core is critical for success. “Core”

is sometimes referred to as an acronym for “Change Or Remain Employed,” which refers to

having a traditional job.

59.

In a June 2022 training in Washington, for instance, a WWG Diamond from

Northern California told IBOs: “Core is the answer. I think all of us have tried to find another

way to do it other than by being Core. There’s just no getting around it. … Core is the key. …

What are your dreams? This is the ticket.” Similarly, in a November 2023 training, an LTD

leader from the Dallas area told IBOs about the importance of buying the training that is part of

being Core: “I have learned from my mentors and coaches that I want to invest in my

development—books, audios, meetings, conferences, subscriptions, whatever it is, I am going to

invest in my development. I am good with that because, you know, the ROI … the Return on

Investment is incalculable!”

60.

Uplines, who are IBOs above others in the recruiting chain, often make it nearly

impossible for their downlines to be “coached” or on their “team” unless they have access to the

Approved Provider’s communication systems, which IBOs must pay for. Basic information like

meeting dates is often only provided through proprietary systems, and uplines say they expect to

communicate with downlines through the voice messaging app. For example, in a March 2022

online training that covered each of the Core “Habits,” a WWG Diamond from Utah told IBOs

the WWG voice messaging app was the key way to communicate with their uplines: “This is like

your lifeline. I like to say it’s your umbilical cord to your upline or to your coach or to your

mentor to be giving you all the nutrients that you need in order to build a successful business.”

61.

Leaders in WWG and LTD also promote “Core runs,” which are one to three

month periods in which IBOs are told to focus on being Core and read or listen to specific

training materials. The message that being Core is essential to financial success is emphasized

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during these periods. For instance, in January 2023, WWG Diamonds Kelly and Darci Ewing

posted the following message on WWG’s private social media feed called “Dreamstream:”

“You’re on a core run or you’re on a poor run.”

62.

The Core Habits and Core Steps relating to buying training are summarized in the

chart below, which is based on WWG training materials and materials used by an LTD Diamond

couple from Richmond, Virginia.

Training-Related

WWG Core “Habits”

Training-Related

LTD Core “Steps”

Training Purchases

“Prioritize attending all” local

and major WWG functions

“Attend all Meetings”

IBOs pay to attend most WWG or

LTD meetings

“Listen and clear” all messages “Communicate Daily

on WWG’s voice messaging

using the MessageApp”

system each day

IBOs pay for access to the WWG

and LTD phone messaging apps

Listen to one WWG audio a

day

“Listen to 1 Audio /

Day”

IBOs pay for access to phone apps

with audio recordings

Read 15 minutes a day from

the WWG book list

“Read 20 Minutes /

Day”

IBOs are supposed to purchase the

books directly from WWG or LTD

“Accountability,” including

valuing the “time and

knowledge” of your upline

mentor

“Be Accountable”

Being accountable includes paying

to attend meetings, which often are

one weeknight per week, one

weekend day per month, and one

weekend per quarter

“Mentorship”: “Develop … a

relationship” with your “upline

mentor”

“Be Coachable”

Getting mentoring or coaching

often requires sending/receiving

voice app messages

Maintain a “Premier

Membership” with WWG

[LTD has an annual fee,

but it is not a Core Step]

WWG has a monthly membership

fee

63.

The financial costs of buying the training or related services required to be “Core”

in WWG and LTD are substantial. Although costs have changed over time, the WWG Premier

Membership has generally cost $59.95 a month (and later rose to $64.95), the WWG audio

platform to listen to audios costs $30 a month, and the WWG voice messaging system costs

$36.95 a month. Tickets to attend the three ticketed “major” WWG events each year cost about

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$200 per person, and entry to local functions can cost $10 or more. Paying for WWG’s

membership, messaging app, and major event tickets alone for a single person costs over $2,100

a year, and other expenses, such as travel to major events, can increase costs significantly.

64.

LTD operates on a subscription model, which bundles the training audios and

voice messaging app together. In recent years, the three main LTD subscriptions have cost

$89.95 a month for a Basic Subscription, $149.95 a month for a Premium Subscription, and

$249.95 a month for a VIP Subscription. LTD also charges a $49.95 per year membership fee,

and it charges IBOs to attend events. The tickets for LTD’s major events are around $140 per

person or more. An LTD IBO with a basic subscription spends over $1,600 a year on the

subscription, LTD major event tickets, and LTD’s membership fee; an LTD IBO with a Premium

subscription spends over $2,400 on those items over the course of a year, and an LTD IBO with

a VIP subscription spends over $3,600.

65.

Since at least the early 1980s, Amway has expressed concerns to IBO leaders

about the amount of money IBOs spend on training through the Approved Providers, but Amway

put few limits on what Approved Providers could charge IBOs until recently. In early 2024,

Amway announced that it would no longer allow the Approved Providers to charge new IBOs

for training during their initial contract year with Amway. In connection with this change, which

was made during the investigation that led to this lawsuit and reduced the Approved Providers’

training revenue, Amway compensated the Approved Providers.

66.

In WWG and LTD, IBO leaders encourage their downlines to stay in Amway and

their Approved Provider for several years while continually purchasing training from those

groups after their first year. These IBO leaders often tell IBOs about a two-to-five year plan to

reach the level of Diamond in Amway’s multi-level marketing structure.

67.

Overview Of Amway’s System Of Bonuses And “Pins”

Both Amway and the Approved Providers encourage IBOs to recruit new IBOs as

a way to generate more points and receive bonuses. Starting in September 2021, Amway began

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requiring new IBOs to sell—or at least report that they sold—$300 of Amway products before

being allowed to start recruiting IBOs. Prior to that time, new IBOs could begin recruiting by

simply signing up and paying Amway’s annual fee, which is currently $71. In January 2024,

Amway ceased charging its annual fee for IBOs in their first contract year. IBOs must still pay

the annual fee in their second contract year and for each year thereafter to remain in Amway.

68.

As noted above, in Amway, an IBO’s recruits and recruits of those recruits (and

so on) comprise the IBO’s downline, and IBOs who recruit others or precede other IBOs in a

given recruiting chain or line are referred to as “uplines.” IBOs who personally recruit others are

called their “sponsors,” and an IBO’s direct recruits are called “frontlines.” IBO leaders often

use the terms “sponsoring” or “helping” instead of recruiting.

69.

Amway’s system of bonuses, which Amway calls a “compensation plan,” is

complex and includes a number of potential bonuses that can be paid on a monthly or annual

basis. Many, but not all, of Amway’s bonuses share names with what Amway calls “pin” levels,

which are mostly named after precious metals or stones, and are markers of prestige and

leadership in Amway. IBOs keep their highest pin level as a title even if substantial numbers of

downlines leave Amway and the IBO no longer meets Amway’s qualification criteria for that

level.

70.

Two important pins are Platinum and Founders Platinum. Amway calls Platinum

an “important milestone” that makes an IBO a “recognized leader,” and Amway’s rules require

IBOs at the Platinum level and above to train IBOs in their downline about the business and

Amway’s rules. To reach Platinum, an IBO must build a group of IBOs that generates about

$25,000 in Amway product purchases in six different months of the year, which is at least

$150,000. To reach Founders Platinum, which is a higher level, IBOs generally need to generate

that level of volume for 12 consecutive months, which is at least $300,000. In terms of

Amway’s point system, purchases of $25,000 generate about 7,500 points, which Amway calls

Point Value or PV. According to Amway, qualified Platinum IBOs and qualified Founders

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Platinum IBOs receive about $20,000 or $41,000 a year in bonuses from Amway, respectively.

71.

Another important pin is Diamond, and obtaining a Diamond pin is often viewed

as the ultimate sign of success in Amway. To reach Diamond, IBOs must have six different

Platinum groups, which are also called legs, that are part of their downline. Since a Diamond’s

downline includes six different Platinum groups (or legs), the combined purchases of those six

legs needs to be at least around $150,000 a month.

72.

To generate these levels of product sales, Platinums and Diamonds effectively

must recruit large numbers of new IBOs who buy Amway products. Platinums typically have at

least dozens of downline IBOs, and Diamonds have hundreds or even thousands. In recent years,

the median number of downlines in a given month for IBOs who had ever been Diamond in

WWG was over 1,000, and it was often higher in LTD.

73.

Reaching Platinum, Founders Platinum, or Diamond is extremely rare. Between

January 2020 and March 2024, there were more than 750,000 IBOs in the U.S. who bought or

sold an Amway product, and only 2.2 percent of them ever reached the level of Platinum or

higher. Of those more than 750,000 IBOs, only 1.3 percent of them had ever reached the level of

Founders Platinum, which is the level that is the focus of Amway-approved recruiting

presentations, or higher. Among these more than 750,000 IBOs, only one-tenth of 1 percent of

them had ever reached the level of Diamond or higher.

74.

For the few IBOs who reach Diamond, it typically takes them many years to get

that pin, and they often subsequently fail to qualify for that level. In 2020 and 2021, ten LTD

IBOs and five WWG IBOs made Diamond for the first time. It took those IBOs an average of 19

years to make Diamond, and the median time to Diamond for that group was over 21 years.

After getting their Diamond pin, eight of the 15 IBOs no longer met the requirements for

Diamond by March 2024.

75.

In terms of bonuses, few IBOs reach the $40,000 or $50,000 figures described in

recruiting presentations for prospects. In each year from 2020 through 2023, about 1 percent of

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IBOs had annual bonuses of $40,000 or more. In 2023, fewer than 1,600 IBOs out of 241,000

IBOs, or approximately 0.7% of IBOs, obtained annual bonuses of $40,000 or more.

76.

The percentage and number of IBOs making $100,000 or more is even smaller.

In each year from 2020 to 2023, fewer than 500 Amway IBOs in the U.S.—out of between

241,000 and 360,000 IBOs in those years—received annual bonuses of $100,000 or more. In

2023, for example, fewer than 350 IBOs or about 0.1 percent of IBOs in Amway received

bonuses of $100,000 or more from Amway out of over 241,000 IBOs. Those IBOs, or a prior

generation of ownership from whom they inherited their IBO, joined Amway an average of 28

years prior to the end of that year, and the median was over 26 years. In 2023, there were 142

IBOs in WWG or LTD combined—about 0.2 percent of the IBOs in those groups—who

received over $100,000 in bonuses from Amway.

77.

In contrast, median total bonuses received by IBOs have been less than $200 in

recent years. For example, in 2022, median total bonuses received by IBOs were $145, and in

2023 that figure was $139. Despite these figures, the IBO leaders of WWG and LTD pitch the

Amway opportunity to prospects as a path to make mid-five figures in bonuses, pay off debt,

replace the income from a full-time job, and even retire young.

AMWAY’S AND THE APPROVED PROVIDERS’ DECEPTIVE

REPRESENTATIONS

78.

The Deceptive Process For Recruiting New IBOs

WWG, LTD, and other Approved Providers focus on recruiting young people

who are under 35 years old. As one WWG Diamond from Southern California put it several

years ago, “[t]he future of this business is 18 to 30 year olds.” In recent years, most of the IBOs

who joined WWG and LTD were under 35 years old, and many were in their 20s.

79.

Part of WWG and LTD’s pitch to young prospects addresses the concern that they

will end up working in unfulfilling jobs for 40 years. The Amway business is often positioned as

a way to be free from financially and personally unfulfilling jobs, and this message continues

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after recruits become IBOs. For example, in WWG’s private social media feed, “Dreamstream,”

at least six WWG Diamond accounts posted the same message to their downlines in October

2022 about building their Amway business for three years to avoid working a job as an employee

for 40 years. The version posted by a WWG Diamond couple who live in the Seattle area, is

below:

Diamondship

Oct 29 2022 03:34 PM

BOOM

shared a photo

PEOPLE DON'T HAVE

THE PATIENCE

TO BUILD

A BUSINESS

FOR 3 YEARS.

BUT THEY HAYE

THE PATIENCE

TO 60 TO WORK

FOR 40 YEARS.

80.

In reality, among IBOs who started in 2020 and were still buying products from

Amway in early 2024, median annual bonus payments in their third full year (2023) were about

$350 and the average was around $1,000. Similarly, among IBOs who started in 2018 and were

still buying products from Amway in early 2024, median annual bonus payments in their fifth

full year (2023), which IBO leaders often claim is the time it takes to reach Diamond, was about

$425 and the average was less than $1,500.

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When recruiting, WWG and LTD IBOs are generally not taught by IBO leaders in

those groups to tell prospects that they work with a multi-level marketing company or a direct

selling company when introducing the business opportunity. Instead, they are taught to

emphasize who they are working with by saying they are being mentored, coached, or working

with a highly successful person, couple, or group of people. This initial pitch is deliberately

designed to allow the IBO to conceal what the opportunity is when asked, as it allows IBOs to

say the money-making strategy belongs to their mentor, and to position the opportunity as an

exclusive one.

82.

According to Amway and IBO leaders, this approach was developed by a

Canadian WWG Diamond and then popularized in the U.S. in the mid-to-late 2010s by WWG

Diamonds Trevor and Alexis (“Lexi”) Baker, who live in the Las Vegas area. This recruiting

method also requires prospects to go through multiple steps before getting a purported “offer” to

join Amway. The steps typically include requiring prospects to attend multiple recruiting

meetings and having prospects read a book, watch videos, or listen to audios. These steps serve

to gauge whether the prospect follows instructions given by the IBO recruiter and uplines who

often assist during the recruiting process.

83.

When recruiting others to join the Amway opportunity and WWG or LTD, IBOs

are also taught to pretend that there are limited spots in the opportunity and that only qualified

applicants can get an “offer” to join. For example, IBO leaders in WWG and LTD tell IBOs to

falsely pretend that there are limited seats at recruiting events, that their mentors are selective

about who they work with, and that the prospect needs the recruiter to get access to the mentor.

In addition, IBO leaders in WWG and LTD pretend that there is an evaluation process for

prospects, which is often characterized as determining whether the prospects have the right

“mindset” or are a “good fit.” In a large recruiting meeting in May 2022 in the Seattle area, for

example, a WWG Diamond told prospects “if you’re a guest in this room, if you earn a spot, if

you’re invited to be part of World Wide Group—[]it is by invitation”—then you will get a free

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ticket to an upcoming conference. Similarly, at a February 2023 recruiting event, an LTD leader

from the Dallas area at the level of Emerald, which is above Platinum, told prospects: “We’re

still checking you out—trying to figure out if you’re going to be a good fit for us because we do

sow a lot of our time and energy and resources into the people that we work with, and we want to

make sure that we’ve got the right people.” However, in reality, anyone who follows the

instructions of their IBO recruiter (and has some money to spend on products or training) will get

an “offer” from a WWG or LTD IBO.

84.

This method of recruiting is called “The Process.” After Trevor and Lexi Baker

became Diamonds in 2015 by using it, The Process was widely adopted in WWG and then

spread to the other Approved Providers, including LTD. One of the ways The Process spread

throughout Amway was through audio recordings of Trevor Baker’s trainings, which were

passed around among IBOs.

85.

Although there is some variation in the initial pitch that IBOs make to prospects,

it usually centers around telling prospects that the IBO knows someone else who has been

successful and can teach the prospect how to make money. The setup for the pitch, as taught by

Trevor Baker, is to start a conversation with someone that leads to a discussion of what the IBO

and the prospect do for work. After IBOs talk about their job, they are taught to transition to

talking about their purported mentors. Some of the model language for this portion of the pitch

has included claiming that IBOs are being mentored by a couple who “retired” or “were able to

walk away from their jobs” in their 20s or 30s and that they had taken the IBO “under their

wing” and are teaching the IBO how to make money—representations that are typically false or

deceptive. An example of this language, which was posted in February 2023 to WWG

Diamonds Kelly and Darci Ewing’s Dreamstream with the exhortation “Memorize this” appears

below:

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D Mail ■ 1

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10:13 PM

ii dreamstream .m.facebook.com

Kelly and Darci Ewing

'lestPrd;,y ~t 1C (16prn

Do you want to hear the craziest thing?

Recently I (or my spouse & I) connected

with a couple that were able to walk

away from their jobs at 28 & 33. That

blew our minds so we pursued them &

convinced them to spend some time

with us. As a matter of fact they agreed

to take us under their wing. And right

now they are in the process of coaching

& mentoring us to change the way we

make money so we can accomplish

similar results in our life so we can stop

sacrificing our life for a job.

Memorize

this

rfJ Like

0 Comment

i;::> Share

86.

Many LTD IBOs are taught to make a similar pitch to prospects, and Amway is

well aware of the details of how The Process works. For example, one early 2019 report to

Amway’s Vice President of Sales explained that “The ‘Process’” was a “sponsoring technique

that initially introduces neither Amway product nor the Amway Opportunity, but rather

introduces the concept of exclusive access to a knowledgeable and successful mentor available

only to a select few qualified prospects.”

87.

In March 2020, Amway’s sales group received a recording in which LTD

Diamond Kevin Schwers interviewed several downlines at a training session about how they

introduce the opportunity. In the recording, three IBOs describe how they tell prospects they are

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being mentored by someone who is “financially independent” including one downline who

described a recent pitch he did with a prospect as follows:

“[The prospect] says, ‘So what do you do?’ And I said, ‘Well, I work at Wells

Fargo full time, but, honestly, what I’m more excited about is a while ago I got

connected with a guy who’s an entrepreneur and was basically financially

independent in his early 30s.’ And he [the prospect] just kind of looked at me and

is like, ‘That’s cool.’ I said, ‘Yeah, so I pursued him. I convinced him to spend

some time with me and mentor me and teach me how to do what he’s doing

because I want to know how to create cash flow so I can retire young and spend

time with my wife and kids and not sacrifice the rest of my life for a job and a

paycheck.’ And he [the prospect] just looked at me and is like, ‘That sounds

really cool.’”

88.

In the recording, Schwers, who became a Diamond in 2021 and is from the Des

Moines, Iowa area, concluded the training interview by saying that he does the “exact same

thing” when he talks to prospects.

89.

WWG and LTD leaders teach IBOs to make these types of deceptive claims

nearly everywhere they go. For instance, IBO leaders advise IBOs to ensure they are free in

their evenings to visit a circuit of big box or grocery stores in their area and do laps around those

stores meeting people. IBOs are also taught to reach out to nearly everyone they know and find

a way to say that they are working closely with a successful person or couple even though that is

often not their actual experience.

90.

WWG and LTD go to great lengths to make it seem that there are many IBO

leaders who are financially successful. IBO leaders in those groups teach IBOs to “edify” any

upline that a prospect may hear speak at an event or be introduced to during The Process. Within

Amway, “edification” typically means claiming an upline or speaker is wealthy, has an amazing

life, and is a good person. Often, this ends up being an upline with the rank of Platinum or

Founders Platinum, who Amway says receive an average of about $20,000 or $41,000 a year,

respectively, in bonuses from Amway.

91.

WWG and LTD leaders also teach IBOs to “edify” their uplines even though

IBOs rarely learn how much higher pin IBOs actually make in Amway bonuses and therefore

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know little about whether their uplines are financially successful because of the opportunity.

Moreover, since IBOs retain the title of their highest pin even if they no longer meet the

qualifications for that pin, IBOs frequently do not know if an upline they are edifying is even

currently qualified at their purported pin level. As a result, prospects are often told to trust the

business building prowess of higher pin IBOs edified by IBO recruiters who know little about

the finances of those uplines.

92.

In numerous instances, the “story” that is part of The Process about meeting a

successful couple who is mentoring or coaching the IBO is false or deceptive. Prospects often

end up getting directly “mentored” by another IBO who is just trying to make it in Amway and

who still has a traditional job. Moreover, IBOs who are mentored by a Platinum or Founder’s

Platinum receiving an average of about $20,000 or $41,000 annually are not being mentored by a

highly successful businessperson, let alone someone who hit it big at a young age or someone

who no longer needs to work. Virtually all of the higher-pin IBOs still need to work their

Amway business to sustain it. IBOs at the Platinum level and above typically have a full

schedule of recruiting events, team meetings, and voice messaging app messages to attend to. In

the many cases in which the Platinum or Founder’s Platinum are married couples, it takes the

efforts of two people to generate annual revenues of about $20,000 or $41,000. To the extent

IBOs purport to be referring to their upline Diamond as the successful couple who is mentoring

them, this is only true in a few circumstances, as most Diamonds have at least several hundred

downlines, meaning that at most they could only take a few IBOs “under their wing” as the

Dreamstream post in paragraph 85 put it.

Substantial Income And That Recruiting New IBOs Is Easy

The Deceptive Claims That Being “Core” Will Practically Guarantee

93.

In recruiting new IBOs and encouraging existing IBOs to stay in Amway, IBO

leaders frequently tout Amway as a way to have both “time and money” or “financial freedom.”

According to these leaders, Amway is superior to a traditional job or gig work in which you trade

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your “time for money” because in Amway your downlines can duplicate your efforts, thereby

allowing you to make more money without more work. IBO leaders also promote the Amway

opportunity as superior to other money-making opportunities, such as starting a small business,

which they characterize as time-consuming, risky, full of “headaches,” and likely to fail. For

example, the training materials used by the LTD Diamond couple from Richmond, Virginia

teach IBOs to tell recruits that the Amway business provides “$, time, & security” in contrast to

starting your own business because “[o]nly 50% … are still in business after the 1st 5 years.”

94.

In promoting the Amway opportunity and the Approved Providers, IBO leaders in

WWG and LTD frequently make claims about their purported success that bear no relation to

what the vast majority of IBOs experience. These claims, which Amway employees admit are

not typical or not realistic, often center around how the Amway business has allowed them to

quit their jobs, be debt free, and spend more time with their spouse or children. For example, in

February 2023, an LTD Emerald from the Dallas area, told prospects and IBOs at a recruiting

meeting: “This opportunity can definitely provide a lot. … It provided us the ability to stay home

with our children. It’s provided us financial freedom. We live debt-free, stress-free. We’ve got

plenty of money in savings.” Similarly, a WWG Diamond from Northern California told

prospects and IBOs about how she was able to quit her job and be home with her children after

three years in Amway during a June 2022 meeting: “In [] less than three years, they [our

mentors] helped us get on this thing called a budget, pay off our debt. We had money in this

account called ‘savings.’ These are all new concepts to us, obviously. And then, I was six

months pregnant with our first child when we started making as much money part-time, on the

side through this industry as I was making in my 40-hour a week job. … I got to be home. I got

to watch all their milestones.” In 2023, there were more than 241,000 IBOs in Amway, and

these two IBOs were in the top 200 IBOs in terms of bonuses received from Amway.

95.

In addition, IBO leaders tell IBOs about the trappings of wealth in their lives. For

example, IBO leaders have told IBOs how they have 13 Christmas trees that take a crew a week

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to set up, how another Diamond spends $250,000 a year on food, or how they know a Diamond

who has a sports memorabilia collection “worth more than most people’s houses.”

96.

IBO leaders claim that following the guidance of an upline mentor and the

“system” developed by IBO leaders is essential to success in Amway. As noted above, in WWG

and LTD, this “system” is called being Core.

97.

In WWG and LTD, IBO leaders claim that being Core is essential for success and

that those who do not succeed failed to be Core. IBO leaders regularly say that success is

practically inevitable if an IBO is Core or plugs into the Approved Provider’s system:

• “Now, can I guarantee you any results from this business based on the

disclaimers we’re required to give? No. But I haven’t met the person yet, and I

am looking forward to meeting this person because it will give me a chance to

go, ‘Oh, I guess there’s one anomaly.’ But so far there hasn’t been. No one has

done the nine Core action steps to the discretion of their upline and not gone

Platinum. Zero. No one has done it for two years and not gone Platinum. You

are 24 months away from the biggest upgrade of your life.” (LTD leader above

Platinum in a Dallas area training session in December 2023)

• After describing an “epic lunch” of poke and ribs while in Hawaii, WWG

Diamond Kelly Ewing told his downline: “[The lunch is] not inexpensive and

the price you pay is Core. The price you pay is Core. If you’re Core, you can

pay for whatever you want all over the world. And that’s the key is pay the full

price so you get the full reward. And people try to shortchange the price, they

shortchange the prize. And that’s not where you want to be guys. Push

through.” (WWG Diamond Kelly Ewing in a video posted online for his

downline in February 2023)

• “[I]f you are core, you’ll get the results that you’re looking for from this

opportunity.” (WWG Diamond Trevor Baker at WWG’s “Spring Leadership”

event in 2021)

• “… I believe if you’re plugged into World Wide, it’s not if, it’s when you will

eventually grow, right. … It’s an amazing system.” (WWG Diamond from

California during a March 2023 training session)

• “I’m convinced if you didn’t grow the way you wanted to grow last year, it’s

only because you’re doing a bunch of other things that’s not benefitting your

Diamondship. … We didn’t build this business because we love it. We built it

because it worked. We built this because it was the greatest vehicle I saw so we

could do the things we wanted to do. … [I]f you don’t quit, you will get through

it. I will promise you that. As long as you have a work habit, as long as you’re

counseling, and as long as you’re willing to be Core. Core is not difficult. It’s

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very childish. It’s ten little silly things, but you got to do them to make this

work.” (WWG Crown Brad Duncan during a December 2022 online meeting)

98.

In both WWG and LTD, one of the elements of being Core is spending substantial

time recruiting other IBOs. In WWG, IBOs are supposed to “Show the Plan,” meaning present

the Amway opportunity and “compensation plan,” to “two people a week or 10 people a month.”

In LTD, IBOs are supposed to conduct three to five interviews with prospects each week.

99.

In standard recruiting presentations in WWG and LTD, IBO leaders claim that

recruiting is not difficult and that it is one of the keys to making money in Amway. For

example, in a January 2023 training in the Seattle area, Brad Duncan talked about the ease with

which IBOs can recruit six new people, which gives them what WWG calls an Eagleship, by

showing prospects the Amway compensation plan: “I think if you’re really showing the plan, I

think it will surprise you that it’s not very hard, that within three to four months that you should

be able to build an—a new Eagleship every three to four months. Let’s just say it takes six

months. … Every three months to five months, your income should grow at least a thousand

bucks a month.”

100.

In these presentations, which are emulated by IBO recruiters in WWG and LTD,

prospects are told to recruit 6 to 12 direct recruits or frontlines and help those IBOs recruit as

well. According to these presentations, the goal is to build a team of 25 to 48 IBOs who follow

your purchasing patterns and thereby help you become Founders Platinum and receive $40,000

or more in bonuses a year from Amway.

101.

WWG leaders tell recruits that building a downline of this size is a routine, almost

inevitable process for IBOs who follow WWG’s methods. As WWG Diamond Maiko Tuitupou

put it in a March 2023 online recruiting event while discussing an IBO’s initial six recruits, “So,

but essentially, check this out, essentially, this is going to morph into 50 different entrepreneurs

and 50 different, well, independent business owners, 50 different IBOs doing 150 points,” which

provides the IBO with bonuses of “just shy of $56,000 a year.”

102.

WWG leaders often tell recruits that they can go on to make much more than the

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mid-five figure bonuses that are shown in presentation slides or drawn on a white board. In a

June 2023 recruiting meeting in Fond du Lac, Wisconsin, for example, a WWG Emerald from

Texas claimed to now be debt-free, despite formerly having $1.2 million in debt from student

loans and buying an endodontics practice, because of the money he made from Amway:

“Tonight, just to be clear, we’re going to talk about a $55,000 part time, extra income on top of

what you’re doing. … That would not have gotten me free so just know there’s more income in

it.”

103.

LTD leaders also tell recruits that recruiting others is not that difficult and that

there is more money to be made than just the $40,000 or $50,000 annually that appears in the

slides at recruiting events. In a February 2023 LTD recruiting event in the Dallas area, an

Emerald IBO leader introduced a handful of IBOs above Platinum and said: “They’ve all helped

and a few others have all helped people go Platinum as well. So it’s not really that challenging.

… You don’t need a degree. You don’t need to go to college. You don’t need to go to trade

school. … We teach people how to do it. Okay? And so, if you’re able to teach three people to

go Platinum, your income at a minimum … is going to be between 150 and $300,000 per year.”

104.

At another Dallas area recruiting meeting in September 2023, the same Emerald

from the Dallas area referenced the $50,000-plus figure presented to prospects and said, “We

make way more than that. That’s not supposed to impress you. It’s just supposed to show that

this thing does work for those who work it.” At that same meeting, an LTD leader above

Platinum, said, “We started our business in October 2006. Sixteen months later, following our

mentors’ and coaches’ advice, following the program that’s in place, we hit the 7,500 point level.

We made a little bit more than what you see on the screen, and we’ve made more money every

year since we’ve been in business. [My wife] was working full-time as a special education

teacher. … In 2011, we were making about triple her teaching income. Can’t quote that, because

for some reason the lawyers think that’s all that we’re allowed to show you, even though you can

do math.”

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105.

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Claims that the business “works” for those who follow the system and that there is

significant income potential that lawyers try to hide from prospects have long been a part of

Amway. In a large meeting for prospects and IBOs in July 2019, for example, Brad Duncan told

the audience in the Seattle area that if you “listen” to him you will be successful: “I have people,

my attorneys say, ‘You can’t tell people [] they have to do this or they have to do that, or you

know, that if you’ll listen, I’ll show you how to be successful. You just can’t say that.’ I go,

‘OK.’ And I still do it. Because it’s true. There’s going to be thousands of people next year that

will retire. There’s thousands of people that are going to create financial success. There are

thousands of people, their income is going to go up an extra two grand a month. … Hey, I was

just in Las Vegas, there was almost five thousand multi-millionaires there. Five thousand in this

business. How many millionaires are there where you work?”

106.

From 2020 through 2023, fewer than 500 IBOs in all of Amway received more

than $100,000 in bonuses in each of those years from Amway. In those same years, fewer than

150 of those IBOs were in WWG.

Just A Few Hundred Dollars

Median Annual Bonuses For IBOs Before Expenses Are

107.

In reality, most IBOs come nowhere near the types of success that IBO leaders

promise is nearly inevitable if they follow their system. In fact, IBOs spend more on Amway

products on average than they get back from Amway. From September 2017 to March 2024, the

average amount spent on Amway’s products by all U.S. IBOs who had a financial transaction

with Amway exceeded the average amount they received from Amway in the form of bonuses

plus retail margin from online sales. The same is true for the median amount IBOs spent on

products in the same period, which was greater than the median amount received by IBOs in

bonuses and retail margin from online sales.

108.

For IBOs who started in 2020 through 2023 and had a financial transaction with

Amway, the total bonuses and retail margin from online sales through March 2024 for each

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cohort (by start year) was just several hundred dollars. The median amounts were less than

$100, and both the average and median amounts received from Amway in bonuses and retail

margin from online sales were less than the average or median amounts they spent on Amway

products. Most of these IBOs left Amway before March 2024.

109.

In WWG, IBOs who started in 2020 through 2023 and had a financial transaction

with Amway had total bonuses and retail margin from online sales through March 2024 between

about $175 (for those who started in 2023) and about $630 (for those who started in 2020). The

median figures for these groups were less than $100. These averages and medians were less than

the average and median amounts those IBOs spent on Amway products and less than the average

and median amounts those IBOs spent on training from WWG. Most of these IBOs left WWG

and Amway before March 2024, and IBOs in WWG who could not be matched to Amway’s data

were excluded from these calculations.

110.

In LTD, IBOs who started in 2020 through 2023 and had a financial transaction

with Amway had total bonuses and retail margin from online sales through March 2024 between

about $175 (for those who started in 2023) and $535 (for those who started in 2020). The

median figures for these groups were less than $100. These averages and medians were less than

the average and median amounts those IBOs spent on Amway products and less than the average

and median amounts those IBOs spent on training from LTD. Most of these IBOs left LTD and

Amway before March 2024, and IBOs in LTD who could not be matched to Amway’s data were

excluded from these calculations.

111.

As noted above, very few IBOs make the promised annual bonuses of over

$40,000 (or $50,000) described by IBO leaders and authorized by Amway. In 2020, 2021, 2022,

and 2023, only about 1 percent of IBOs received bonuses of $40,000 or more.

112.

IBOs who made $40,000 or more in Amway bonuses in 2023 joined Amway an

average of over 21 years before December 2023. The median number of years prior to

December 2023 that those IBOs joined Amway was over 17 years.

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113.

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Amway is well aware that the earnings claims it allows the Approved Providers

and IBOs to make bear little relationship to the gross revenues, let alone net income or losses,

experienced by most IBOs. In mid-2019, an analysis shared among Amway’s senior leadership

showed that the average annual gross payments for certain new IBOs in each of the five largest

Approved Providers was between $132 and $230 in the previous two years. In the years that

followed, Amway introduced some bonus changes to try to increase these figures, but average

annual bonuses for new IBOs did not increase significantly. Despite this reality, Amway

encouraged the Approved Providers to promote the Amway business opportunity using

significantly higher figures, which Amway told IBO leaders could not exceed the average

received by those who were Founders Platinum. In 2022, for example, Amway guidance and

presentations to IBO leaders encouraged them to claim new IBOs could make about $3,100

annually, which would actually put a new IBO in the top 10 percent of bonus earners. In

addition, Amway encouraged IBO leaders to present bonuses for IBOs building their business in

the $20,000 to $43,000 range, and bonuses for leaders at more than $53,000 annually. Amway’s

executives were aware that these bonuses were only obtained by a very small percentage of U.S.

IBOs.

114.

For WWG and LTD IBOs in 2022 and 2023, median total bonuses in each of

those years was between $105 and a little over $200. The median total bonuses plus margin paid

to IBOs in those groups for online sales in each of those years was about $250 or less.

115.

The chart below depicts the average and median total bonus payments in 2023 for

the more than 241,000 IBOs who bought or sold an Amway product in that year by decile:

IBO Group (2023)

Top 91-100% (>90% to <=100%)

81-90% (>80% to <=90%)

71-80% (>70% to <=80%)

61-70% (>60% to <=70%)

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Average

Bonus

Payments

$13,094

$1,139

$557

$314

Median

Bonus

Payments

$4,228

$1,091

$545

$310

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IBO Group (2023)

51-60% (>50% to <=60%)

41-50% (>40% to <=50%)

31-40% (>30% to <=40%)

21-30% (>20% to <=30%)

11-20% (>10% to <=20%)

Bottom 1-10% (<=10%)

116.

bonuses less than that amount in 2023.

117.

The chart below depicts the average and median total bonus payments in 2023

among certain segments of those in the top decile of IBOs who bought or sold an Amway

product that year:

IBO Group (2023)

Top 1% (>=99%)

Top 2-5% (>=95% to <99%)

Top 6-9% (>=90% to <95%)

Median

Bonus

Payments

$182

$106

$60

$34

$11

The 90th percentile bonus payment amount is $1,756, meaning that 90 percent of IBOs received

Average

Bonus

Payments

$184

$107

$61

$34

$11

not reflect any expenses incurred by IBOs, such as Amway product purchases or training costs.

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Each decile is the same size and represents about 24,000 IBOs, and the deciles do

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118.

Average

Bonus

Payments

$77,887

$9,910

$2,676

Median

Bonus

Payments

$49,379

$7,858

$2,519

An “Income Disclosure” document published by Amway does not contain any

information about how many prospects IBOs are typically able to recruit. In a section under the

heading, “Typical Earnings,” the document provides what it now calls the annual “average

earnings for all U.S. IBOs at the Founders Platinum level and below.” For 2023, Amway’s

document puts this “average earnings” figure at $841, which does not account for product

purchases or other costs, such as training. When this figure is mentioned during the Approved

Providers’ recruiting events, IBOs downplay it by, for instance, assuring recruits they will be

above average if they follow the Approved Provider’s system.

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The average purported “Typical Earnings” that appear in Amway’s income

disclosure statement are misleading insofar as they do not enumerate expenses, and they are used

in the context of a system in which only a small group of IBOs at the top receive substantial

bonuses. Amway is well aware that “Compensation is disproportionately allocated to [the] top,”

as one internal Amway presentation put it, yet Amway and the Approved Providers do not

provide prospects or IBOs with median bonus information concerning all IBOs or all IBOs

below Founders Platinum. In recent years, the median bonuses received by IBOs in a given year

have been less than $200.

120.

Part of the reason median bonuses are so low is that recruiting is difficult, and

therefore it is hard to generate bonuses based on Amway product purchases made by downlines.

In 2020, 2021, 2022, and 2023, most IBOs failed to recruit a single IBO. As a result, the average

number of recruits per IBO in those years was less than one, including for IBOs in WWG and

LTD.

121.

Only a small percentage of IBOs manage to personally recruit 6 or 12 IBOs

themselves. In October 2022, for instance, there were 121,000 IBOs in Amway, and less than 7

percent of them had six or more personal recruits, which are known as frontlines. In that same

month, less than 1.5 percent of IBOs in Amway had 12 or more frontlines. Similarly, in October

2022, fewer than 9 percent of IBOs in WWG and LTD had six or more frontlines, and less than 2

percent of IBOs in WWG and LTD had 12 or more frontlines.

122.

In addition to the difficulties IBOs face in recruiting, many IBOs do not stay in

Amway for long. Most new IBOs’ financial interactions with Amway last less than one year,

which means Amway and the Approved Providers need to continually recruit new IBOs to

purchase Amway products and training to maintain their revenues.

123.

Amway is well aware of the deceptive claims the Approved Providers and their

IBO leaders make about the ease of recruiting. For example, one Amway manager

acknowledged there are “[l]eaders that promote a new leg per month, so that they have 12 at the

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end of the year,” before deciding to use 12 frontline recruits in his own illustrations of how

Amway’s bonus system works. Telling IBOs they can recruit one new leg per month is

deceptive because that is far from what is typical.

124.

Amway also knows that IBO leaders regularly make deceptive earnings claims to

prospects and IBOs. For example, one Amway presentation circulated to several employees and

managers noted a “common” reason IBOs leave the business is “that they are dissatisfied with

the level of compensation received…. Primarily, the compensation they received didn’t match

what they feel the upline presented to them before registering…. One reason for this disconnect

… is that many uplines present a highly lucrative compensation plan.”

125.

Likewise, Amway is well aware that IBO leaders make deceptive claims about

paying off debt, replacing the income from a full-time job, and retiring early. In the context of

reviewing BSM prepared for IBOs, Amway employees have noted such claims are unrealistic or

atypical. For instance, in June 2022, one Amway reviewer required the removal of references to

being taught to be “debt free” in one of the talks of a WWG Diamond who now lives in Arizona

because it is “not a typical lifestyle result” of the Amway business. Similarly, another Amway

reviewer required the removal of claims in an LTD Diamond’s presentation about IBOs being

able to stop working after paying off debt—specifically, “multiple mommas coming home and

being stay-at-home moms. Free moms.”—because they were “not typical results.” Likewise, in

May 2021, an Amway reviewer told WWG to delete claims by a WWG Diamond about having

coached someone so that “[t]hey can walk out of their job if they want to” because “earnings …

must be realistic.” The same reviewer also deemed WWG Crown Brad Duncan’s statements in

October 2022 about how easy it is to build a team of 20 IBOs to be “Not Realistic.”

126.

Despite being aware that IBO leaders make such deceptive claims, Amway does

little to punish or deter them, and IBO leaders continue to make deceptive claims about the

Amway business. Moreover, Amway executives know that the Approved Providers continually

violate Amway’s content standards, and Amway in fact does little to police such violations.

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When one long-time account representative found out that Amway had only sent 13 breach

letters to Approved Providers for content standards violations from 2017 to 2021, he told

Amway’s then-Vice President of Sales, “we could probably send out 13 breaches in a week if we

wanted to.” The Vice President of Sales responded by saying, “Sad, but true!”

Thousand Dollars Annually

The Deceptive Pitch For Side Income Of A Few Hundred Or A Few

127.

In recruiting meetings, the main pitch to prospects is that they can be debt-free,

replace or exceed their current income, and live like IBO leaders do. In doing so, however,

recruiters also claim that the business provides the opportunity for IBOs to earn a side income of

a few hundred or a few thousand dollars a year. These claims are the result of a deliberate

strategy by Amway, which, in addition to approving presentations about making mid-five figures

a year in bonuses, also told the IBO leaders of the Approved Providers in meetings in 2020 that it

wanted them to promote the business in a way that would allow it to “accommodate those that

have modest goals.”

128.

In WWG and LTD recruiting presentations, the side-income claims are made in

the build-up to discussing figures in the $40,000 to $50,000 range. Most of the build-up involves

discussions of issues not directly related to the business, such as how traditional jobs do not pay

well or do not leave enough time to spend with family.

129.

When WWG speakers eventually describe the business, they lay out a three-step

process to make five-figures annually. The first two steps are the part of the build-up in which

they claim IBOs can make a few hundred or a few thousand dollars a year in net side income.

130.

Step 1 in the WWG presentations portrays an IBO whose product purchases and

online sales total 150 Point Value or PV a month, which is about $500. An IBO’s personal

purchases and online sales are known as their “blueprint.” According to these WWG

presentations, an IBO who has this blueprint for a year with no recruits will make $522.

131.

Step 2 in the WWG presentations portrays an IBO with the same blueprint who

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recruits six IBOs who duplicate the same 150 PV blueprint. As presented by WWG, this IBO

only generates a retail margin of about $30 per month but when combined with bonuses, WWG’s

slides claim this results in “Total Annual Earnings” of more than $3,900. As discussed further

below, Step 3 illustrates how an IBO with 48 downlines copying the same 150 PV blueprint will

make mid-five figures annually.

132.

LTD presentations are similar, and they also depict steps in which IBOs make a

few hundred or a few thousand dollars annually as they begin to recruit other IBOs who copy

their blueprint. The LTD presentations typically culminate by illustrating how an IBO with

about 25 downlines will make mid-five figures or more annually.

133.

In recruiting meetings, IBO leaders in WWG and LTD deceptively refer to gross

revenues of a few hundred or a few thousand dollars as net income that goes into an IBO’s

pocket. These representations ignore the cost of buying Amway’s products and the cost of

purchasing training from Approved Providers, among other things. For example, IBO leaders in

WWG and LTD often claim these amounts are “profit” or like getting “a raise”:

• In discussing the $522 annual revenue from Step 1 that appears in WWG

recruiting presentation slides, a WWG Diamond from Arizona told recruits and

IBOs in March 2023 “that’s about $522 of profit annually” before going on to

say that the $3,900 in revenue from recruiting six people in Step 2 would not

make you “rich” but that “if a lot of you got a $4,000 raise today, you would be

fired up.”

• In discussing the same two figures, WWG Crown Brad Duncan told IBOs and

recruits in January 2023 that “you’re going to put an extra $500 in your own

pocket” and if you recruit six people “that will put an extra $4,000 a year in

your pocket. … I think if your boss came up to you tomorrow and said, ‘I want

to give you a $4,000 raise,’ … I think you’d … text all your friends.”

• In discussing the $4,000 figure resulting from recruiting six people in Step 2, a

WWG Diamond from Northern California told recruits and IBOs in February

2021: “That’s a big deal, guys. I remember before I started my own business,

the idea of saving an extra $4,000 or making an extra $4,000 was huge. … Hey,

four grand could fully fund a Roth IRA. Four grand could pay off that credit

card from that lingerie company that you shop at. … So you can pay off those

pesky little credit cards that are tough to pay off these days.”

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• In discussing the monthly performance bonus, purported retail margin, and

other bonuses from a 300 PV blueprint, an LTD Emerald told recruits in

February 2023 that an IBO “gets about $300 in profit.”

• In discussing the benefits of having a 300 PV blueprint, an LTD leader told

recruits and IBOs in September 2023 meeting in the Dallas area: “A business

like that, the way that we teach, the way that we coach it, should yield you a

cashflow of about $200 [a month]. Ok? So, nothing fancy, nothing flashy, but

you’ve given yourself a $200 raise by redirecting your buying habits and

redirecting some buying habits of people that you know.”

134.

The slides used by WWG and LTD in recruiting meetings also portray gross

revenues as net benefits to IBOs. WWG’s recruiting presentation slides refer to bonuses and

other potential revenue of $522 or about $3,900 as “Total Annual Earnings” for IBOs. Similarly,

LTD recruiting presentation slides often refer to bonuses from Amway as “earnings” or

“income” without accounting for product costs.

135.

The WWG and LTD recruiting pitches do not account for the cost of being in

those groups, other business costs, or the cost of purchasing Amway products. Paying for

WWG’s membership, audios, messaging app, and major event tickets alone for a single person

costs over $2,100 a year, and annual costs in LTD range from over $1,600 to over $3,600. IBOs

also incur other costs, such as transportation expenses and hotel rooms for “major” events held in

arenas around the country on weekends. In 2022, WWG itself estimated that the annual cost for

one person to be in WWG was between $3,500 and $5,500 and that the cost for a couple was

between $4,000 and $6,000. These estimates did not include the cost of purchasing Amway

products. Instead, these estimates included the cost of paying for training offered by WWG,

travel to its weekend functions, and the annual Amway fee.

136.

None of the standard WWG or LTD presentation slides describe the cost of being

in WWG or LTD, and although some of them contain disclaimers about other expenses, they are

vague and in small print. Many recruiting meetings are conducted using white boards, and

speakers do not put disclaimers on them.

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Amway is well aware that IBO leaders avoid presenting the costs of being an IBO

alongside the potential bonuses they can receive from Amway. As one Amway employee who

regularly met with WWG leaders noted in a February 2021 email, “Ww leaders … hate”

presentations “comparing what they [IBOs] make with what they spend on products.” In

addition, Amway approved the standard slide presentations used by WWG and LTD that fail to

present the cost of training and characterize an IBO’s revenue from Amway as “earnings” or

“income.”

AMWAY INCENTIVIZES AND THE APPROVED PROVIDERS

PRESSURE IBOS TO BUY AMWAY PRODUCTS THEY WOULD NOT

OTHERWISE PURCHASE, FAKE SALES TO PURPORTED

CUSTOMERS, AND RECRUIT NEW IBOS TO DO THE SAME

Amway’s Compensation Plan Incentivizes Recruiting IBOs And

Obtaining Substantial Bonuses From Product Sales Alone Is Virtually

Impossible

138.

Amway’s system of bonuses incentivizes IBOs to try to recruit a large number of

downline IBOs to purchase Amway products each month. For Amway’s principal bonuses,

IBOs not only get credit for their own blueprint, which consists of personal purchases and online

sales, but also for the product purchases in their downlines’ blueprints. As the speaker notes to

LTD’s standard 2024 recruiting presentation state, “You do NOT earn money solely from the act

of sponsoring new IBOs, but DO get a percentage of the volume running through their

businesses.”

139.

The two main bonuses promoted by Amway and the Approved Providers to

prospects are called the Performance bonus and the Differential bonus. Amway uses two figures

that are assigned to each of its products in calculating these bonuses. One figure is the number

of points associated with each product. As noted above, these points are called “PV,” which

stands for Point Value, and the other figure is called Business Volume or BV. A product’s BV is

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about 3.43 times greater than its PV at present, and BV generally equates to the price Amway

charges IBOs to buy a product. Accordingly, it now costs IBOs about $3.43 to get one point of

PV. For many years prior to September 2020, when Amway began increasing the ratio of BV to

PV, the ratio of BV to PV was 3:1.

140.

The Performance bonus is a percentage of the Business Volume or BV in an

IBO’s blueprint in a given month. The percentage of BV that is paid to an IBO as a Performance

bonus is determined using a sliding scale based on the amount of PV generated by an IBO and

the IBO’s downline. For instance, an IBO who generates 150 PV in a month falls into the 3

percent Performance bonus level. That percentage is then applied to the IBO’s Business Volume

or BV, which in this case is $514.50 (3.43 multiplied by the 150 PV). In this example, the IBO

would get a Performance bonus of 3 percent of $514.50, which is about $15 for that month. The

sliding scale for Performance bonuses ranges from 3 percent to 25 percent, and it can be seen at

the top of the WWG brochure that appears in paragraph 162 below.

141.

IBOs can increase their Performance bonus levels by increasing their blueprint or

recruiting downline IBOs who generate volume. Amway’s main guide for IBOs illustrates how

IBOs can move up three Performance bonus levels—from 3 percent to 12 percent—by recruiting

three new IBOs. The 12 percent Performance bonus bracket applies to IBOs whose group

volume is between 1,000 and 1,499 PV in a given month, and in this example the three recruits

have a total of 1,150 PV a month, which is about $4,000. The graphic below from Amway’s

guide illustrates how volume from three frontline recruits “Passes Up” to their sponsor and

moves that IBO into the 12 percent level:

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150/450

Frontline A

450/1,350

Frontline B

100/300

Frontline C

600/1,800

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Group PV/BV

Performance

Bonus Level

1,300/3,900

12%

➔ Passes Up

to You 1'

➔ Passes Up

to You 1'

➔ Passes Up

to You 1'

142.

The Performance bonus is supplemented by Amway’s Differential bonus. For the

Differential bonus, IBOs are paid a percentage of the dollar amount of their downline IBOs’

purchases and sales. That percentage is also calculated using the sliding scale from 3 to 25

percent based on the monthly PV of an IBO and the IBO’s downline.

143.

Because the sliding scale percentage for both the Performance and Differential

bonuses is based on the blueprints of both an IBO and the IBO’s downline, IBOs are incentivized

to recruit IBOs who generate PV. To reach the 25 percent level, the blueprints of an IBO and the

IBO’s downline must generate 7,500 PV or more in a month, which equates to about $25,000 a

month of Amway products.

144.

Other bonuses require that an IBO have a particular number of recruits in order to

qualify for them. For example, one of Amway’s incentives, which is known as Bronze

Foundation, allows IBOs to increase their Performance bonus if they recruit three other IBOs

who generate at least 100 PV in a month. Likewise, the Emerald bonus requires IBOs to have

three different downline groups (or “legs”) with at least 7,500 PV each, and the Diamond bonus

requires IBOs to have six downline groups or legs with at least 7,500 PV each.

145.

As a practical matter, the downline legs required for an IBO to achieve Emerald

or Diamond status must have many recruits because generating 7,500 PV requires product

purchases of about $25,000 a month. Platinum IBOs, who lead one group with about $25,000 in

monthly purchases, typically have at least dozens of downline IBOs. In recent years, the median

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number of downline recruits in a given month for WWG and LTD Platinums, including those

who may no longer qualify for Platinum, has been about 50 to 140 IBOs. Diamonds, who lead

six different groups that each have about $25,000 in monthly purchases, typically have hundreds

or thousands of downlines.

146.

In contrast, it is extremely difficult to reach the 25 percent level for the

Performance and Differential bonuses without relying on downline volume. Since 2020, no

IBO’s personal blueprint of personal purchases and online sales has been 7,500 PV or more in

every month of the year. Given that Amway’s rules generally prohibit an IBO from selling

Amway products through physical stores or non-Amway online marketplaces, selling large

quantities of Amway products, such as $25,000 a month, is nearly impossible.

Recruiting Instead Of Customer Sales

The Approved Providers And IBO Leaders Tell IBOs To Focus On

147.

The incentives created by Amway’s compensation plan are reflected in how

Amway and the Approved Providers tell IBOs to succeed. In its main guide for IBOs, Amway

tells IBOs they can “accelerate and maximize your own earnings” by recruiting other IBOs.

Consistent with this guidance, the IBO leaders of the Approved Providers instruct IBOs to focus

on recruiting new IBOs to duplicate their blueprint.

148.

For example, a WWG training video featuring a Diamond, which was provided to

Amway in June of 2021, tells IBOs, “The magic of what we do is we duplicate those blueprints.

… Think of the rule of 500. Would you want 500 people duplicating your blueprint?” Likewise,

in a June 2022 training session in Washington, a WWG Diamond from Northern California told

IBOs she and her husband “always wanted to have a very duplicatable, kick butt blueprint for

people to duplicate.” In LTD, one shorthand for this strategy is known as “DITTO and

Duplicate,” which refers to Amway’s “DITTO” recurring order system.

149.

IBO leaders in both WWG and LTD teach prospects and IBOs to develop

blueprints with about $500 or $1,000 in Amway product purchases each month. The maximum

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revenue that can be generated by these blueprints is about $100 or $200 per month, respectively,

for IBOs with no recruits. Given that these blueprints are not lucrative for IBOs without recruits,

the IBO leaders of the Approved Providers explain to their downlines that they need to recruit to

achieve real financial success through Amway. For example, in a January 2024 training, an LTD

leader above Platinum told IBOs that their success hinged on recruiting: “We leverage amazing

products, the best products in the world. But if you want financial freedom—if you want to dig a

well—a.k.a. generational wealth for your children and for your family—it all lies in your ability

to sponsor other human beings.”

150.

Similarly, in the June 2023 recruiting meeting in Fond du Lac, Wisconsin,

referenced above, the WWG Emerald claimed his mentor taught him that recruiting people who

buy Amway products for themselves is the key to success: “What [my mentor] said is, ‘[] I’m

going to teach you if you want, how to build organizations of people who build organizations of

people who primarily change their point of purchase and shop from their own … store. . . .’”

151.

In addition to the incentives to recruit that are part of the Amway compensation

plan and the guidance provided by IBO leaders, the Approved Providers use metrics and

milestones that encourage IBOs to focus their energies on recruiting. For example, in WWG

being Core requires IBOs to show the plan to two people a week or 10 people each month.

Similarly, one of the key milestones in WWG is called Eagle, which largely consists of

recruiting six new IBOs. Making Eagle is a mark of prestige in WWG, and it allows IBOs to

attend exclusive events and sit in preferred seating with access to IBO leaders at the group’s

main events.

152.

Similarly, LTD’s first Core step requires IBOs to hold three to five recruiting

meetings with prospects each week. LTD calls these Qualifying Interviews, which reflect the

deceptive posturing of the opportunity as something prospects need to qualify for. IBOs in LTD

are directed to follow a “Roadmap for Success” that focuses on the number of downlines IBOs

recruit. After the first step in the Roadmap, which is developing a blueprint with 300 PV called

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Core 300, all of the subsequent steps in the Roadmap relate to recruiting. The second step is

called “3/10,” which means having three lines of recruits (or legs) and 10 IBOs on your team.

The last step is “12/100,” which means having 12 lines of recruits and 100 IBOs on your team.

A copy of the Roadmap appears below:

fi ADMAP

12/100

FDR SUCCESS

9fl5

- FOR EMERGING LEADERS -

6/50

3/10

CORE 300

"BALANCED BUSINESS"

YCS l'V + PERSONAL USE

UAMl'LESPV

3 PERSINAL ms

10 TOTALPUPLE

lnrul~f!:""'

1000

GPV

ln8cislircorPrNola

9 PEISONlllEGS

75 TDTALPEOPLE

6/25

6 PERSONAL LECS

""'=~

&msmum

-:,.Sdf~

15000

GPV

.. E-.i.,_,.

,..,_

~Sdll><°"""

7500

GPV

.,_,..,,,..,,.,_.

2 5 mAL PEOPLE

..,,._E..,.

50 TOTAL PEOPLE

12 PERSONAL ms

100UTALPEIPLE

~Al~

Fi,jMoo(h

4000

GPV

lnf.JdSlirworProvb.n.

HA""°""'

rJMonlll

153.

In both WWG and LTD, IBO leaders relentlessly tell IBOs that they need to

recruit to succeed and that they should recruit by showing prospects their summary of the

Amway compensation plan. For example, in a March 2022 recruiting session, WWG Diamond

Maiko Tuitupou emphasized the importance of showing the plan to prospects to recruit them,

which in WWG often involves drawing a stick figure on a white board or a napkin that

represents IBOs shopping from their own Amway “store”: “My mentor[] [showed] me this. He

goes, ‘Maiko, if you can draw that stick figure then you can build something for yourself.’ And I

just chose to believe that. I chose to believe that, OK, if I learned how to draw that stick figure

and I learned how to do it over and over and over and over and over and over again, in my

opinion it wasn’t a matter of if I was going to become successful, it was just a matter of when I

became successful….” An image of one such stick figure that illustrates an IBO switching from

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buying products from “The Store” owned by others to buying products from “Your Store” is

visible in the photograph of a white board in paragraph 165 below.

154.

Similarly, in a March 2023 training in the Seattle area, a WWG Diamond from

Arizona told IBOs to focus on showing the plan: “If you want to grow your business, you gotta

grow your team. … Let’s be a team of showing the plan. … Whoever brings the most people [to

recruiting meetings] wins. … And the number one thing you need to be focused on is: show the

damn plan!”

155.

Likewise, an LTD Diamond from the Kansas City area told those attending a

recruiting session in January 2025 that recruiting new IBOs was the essence of the business:

“[W]hen it comes to building the Amway business, alright, and developing this income that

we’re going to talk about here tonight … it’s all about building teams.”

156.

Consistent with how Amway’s compensation plan incentivizes recruiting, selling

Amway products to customers is often portrayed by IBO leaders as just a compliance

requirement and not the key to making money. In recruiting and training meetings, IBO leaders,

including WWG Crown Brad Duncan, often refer to customer sales as just a requirement for

having a “legal” business. In addition, IBO leaders frequently teach IBOs ways to circumvent

Amway’s customer sales requirements or downplay such sales by saying IBOs only need to

make a few sales to friends or family. For example, after talking about having a customer base

consisting of “friends and family,” the WWG Emerald at the Fond du Lac event noted in June

2023 that customer sales are not that important: “[T]he reality is, that’s not the power of the

model.”

157.

In addition to presenting Amway’s compensation plan to prospects themselves,

IBOs are supposed to attend recruiting meetings in which IBO leaders present the plan to

prospects. IBOs are told to attend these meetings, which occur weekly in places like hotel

meeting rooms, even if they do not have a prospect to bring to the meeting. IBO leaders tell

IBOs to help create an energetic environment for these sessions, and IBOs are taught to do things

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like “laugh and nod” during the presentation, which they may have already heard dozens or

hundreds of times.

158.

In recent years in WWG, the portion of the Amway-approved presentation to

prospects that discusses the business is built around an IBO with a 150 PV blueprint of personal

purchases and any online sales. Once that blueprint is shown, nearly all of the subsequent

increases in “earnings” that are presented result from the IBO recruiting new IBOs rather than

the IBO selling more Amway products. The use of the 150 PV blueprint is consistent with

Amway’s compensation plan, which requires IBOs to have at least a 150 PV blueprint to qualify

for many of Amway’s bonuses.

159.

WWG speakers and the WWG presentation slides say the 150 PV blueprint

equates to 450 BV or $450 in Amway product purchases by using the old 3:1 ratio of BV to PV.

Step 1 in the presentation shows an IBO with a 150 PV blueprint and no recruits getting $522 a

year. This sum is comprised of $30 in monthly retail margin and $13.50 in monthly Performance

bonus. At present, it costs an IBO about $500 a month or about $6,000 a year to generate a 150

PV blueprint.

160.

Step 2 shows an IBO recruiting six people who duplicate the 150 PV blueprint,

which results in annual revenue for the IBO of more than $3,900. In the presentation, the

monthly retail margin in Step 2 for the IBO is still $30, and the remainder of the revenue comes

from the Performance and Differential bonuses.

161.

Step 3 purports to show how to make over $40,000 or $50,000 annually. In the

standard Amway-approved WWG presentation to recruits used in recent years, IBO leaders

claim that the six people you recruited will each likely go out and recruit six people themselves

while you recruit another six people. According to the presentation, this means the IBO will

have a total of 48 downlines and receive over $50,000 in bonuses from Amway. In mid-2024,

WWG’s Amway-approved presentation slides were changed to lower this figure to about

$40,000 by removing a reference to one bonus.

COMPLAINT - 53

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FEDERAL TRADE COMMISSION

One Bowling Green, Suite 318

New York, NY 10004

(212) 607-2829

Case 2:26-cv-03474

162.

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Amway-approved WWG recruiting materials often use circles to represent

prospects who get recruited as IBOs. A 2022 WWG recruiting brochure that condensed the three

steps described above appears below. Step 1 depicts an IBO (“You”) with a 150 PV blueprint,

and Step 2 depicts “You” recruiting six people to duplicate your blueprint. The six recruits in

this step are represented by the six circles that say “Step 1,” meaning the six recruits are doing

the 150 PV blueprint that is Step 1. In the presentation, Step 3 involves those six people

recruiting six people each, but the brochure below only depicts six of those 36 additional recruits

in the white circles that say “Step 1.” In the Step 3 section below, the Step 1 circles in gray

represent six additional frontlines recruited by “You,” and those additional frontlines are also

copying the 150 PV blueprint.

Amway 180 Compensation Plan (Performance Bonus Sc hedule)

Tot>IMoathlyPV,

700

Performa nce Bon~% 1sp,1,d on BV'

300

600

7,000

1, 500

2,500

4,000

6,000

7,500

•.,,wwz.atw GJ,RN ■►;?,QUI w;;.aww ■t•W¥14 W4Q.hii4 Wff,Ml ■ W;t.@tW

~i.m bt ,11 <IIJllllfled PI.J\lr'l1Jm 01 aoo1t 10 e..,rn Pl.vlnum Plu~.r,.a1ds. ........,wt,,fe-5 Mid ~ mos, 3d-..10S to eam h,9ne1 m::ir1th ~Jviards. 5<"e-Abie/&J:ib,wd5 PCf r'or a(jij ,1,oMI tionuse; ~nd 011'5ehffl.lil'/Corp. I-JI rl;itm ~ Repr□ d ucedund:ir lceme from A.mw,n, Carp. Umutha11.zed dup'1ca!la, 1s prctnbltecl. Ho1e:Assume:s ~ 1D Pv ratio Is 3.00ta 1.

Available Retail Earnings: $30.00

($300 BV x 10%)

Customers'

$300 BV/100 PV

\ 4 50 8\1

Performance Bonus: $13.S O

($450 BV x 3%)

Toto/ Monthly Eorn,ngs: $43.50

Tola/ Annual Earnings: $522.00

Available Retail Earn,ngs: $30.00

($300 BVx 10%)

Performance Bonus: $378.00

($3,150 BVx 72%)

)3,]50(JfUUJ ~

.O:iO G·oJ P. rv

·,1·1

Ner Performance Bonus: $297.00

($37800 - $81 00)

Tola/ Monthly Earnings: $32 7.00

Total Annual Earnings: 3j)24.00

Available Retail Earnings: $60.00

(S 600 BV x HJ%)

Performance Bonus: $5,625.00

($22.500 BV x 25%)

Less 6 Groups at Step 2: $2,268.00

($3,lSOBVx 72%x6)

i22,500Grou.) SV

7,500 Gro Jo ,v

Less 6 Groupsat Step I. $81.00

Net Performance Bonus: $3,276.00

($5,625.00- $2,349.00)

Q- I 2 Bonus·: $15.000.00

(Annual Bonu s for achieving 7,500 PVfor 12 months)

Total Monlhly Farnings: $3,336.00

Tora/ Annual Earnings & Bonus: $55,032.00

Less 6 Groups at Seep I: $87 .00

·in 10.l1,nA-l41%af.Y-T:M?l80seamed theAnnualGI· Q12 Hanus

163.

In the depiction of Step 3 above, the IBO’s blueprint is increased from 150 PV to

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300 PV per month. However, the IBO’s retail margin from selling Amway products to

customers only increases to $60 a month, which translates into $720 a year.

164.

In the slides WWG started using in 2024 in which Step 3 generates $40,032, the

monthly retail margin is also $60 a month and $720 a year. In these slides, the bonuses that are

attributable to downline volume are over $38,000. This means that 96 percent of the IBO’s

revenues in WWG’s presentation slides result from volume generated by downline IBOs.

165.

Many of WWG’s recruiting meetings are called “board plans” in which a speaker

uses a white board instead of or in conjunction with the WWG slides. The presentations with

white boards also follow the three-step format and emphasize the need to recruit new IBOs to get

larger bonuses. An image of one such white board that was used by a WWG leader above

Platinum in the Seattle area appears below. Like the recruiting brochure above, the white board

uses circles to represent IBOs and shows the amount of recruiting required to make more than

$55,000. In this white board, the central circle represents an IBO who starts with a 150 PV

blueprint, and the other circles represent the 48 IBOs in that IBO’s downline, namely the 12

frontline recruits and the 36 recruits of the IBO’s first six frontline recruits:

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166.

In LTD, the recruiting pitch is similar, except that LTD leaders sometimes use

slightly different blueprints, including ones with 300 PV or a combination of 150 PV and 300

PV, which correspond to about $500 and $1,000 in Amway product purchases each month. LTD

presentations using a 300 PV blueprint culminate with the speaker claiming IBOs need about 25

recruits duplicating their blueprint to make monthly bonuses that result in mid-five figures in

annual “earnings.” In 2024, the LTD slides approved by Amway reduced the annualized bonus

figure from over $50,000 to a little over $40,000.

167.

In recent years, Amway has tried to make it appear that it is making significant

efforts to promote sales to customers through incentives such as one it calls a “Customer Sales

Incentive.” This incentive boosts the Performance bonus when IBOs sell to customers, but it is

capped by Amway at $75 per month, and it has no bearing on the larger bonuses for IBOs.

Specifically, the Customer Sales Incentive does not apply at all to IBOs whose groups generate

1,000 PV or more, which is about $3,500 in monthly purchases. As a result, this incentive does

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not apply at all to the situations presented in WWG and LTD’s recruiting presentations in which

IBOs need to generate $25,000 in monthly purchases in their groups. Accordingly, the purported

Customer Sales Incentive is consistent with the messaging from IBO leaders to their downlines

that the way to earn significant income in Amway is to recruit a large team of IBOs—not to sell

products to customers.

Amway Products Themselves In Order To Build Their Business

The Approved Providers And IBO Leaders Tell IBOs To Buy

168.

An IBO’s success in the Amway compensation plan depends upon recruiting

downline IBOs who will generate points each month. Given that Amway’s products are pricey

and difficult to sell to customers, the Approved Providers and IBO leaders tell IBOs that the

easiest way to generate points each month is to buy Amway products themselves, rather than try

to sell products to customers. As is further discussed below, Amway is well aware of this

practice, which it calls a personal consumption or self-consumption business model.

169.

To convince IBOs to buy Amway products, the IBO leaders of the Approved

Providers set purchase standards for their downlines, tell them that they should be “Core” and

“loyal” to their “own store,” and claim that buying Amway products for themselves is an

essential part of building the business. IBOs are also told to buy products even if they do not like

them and regardless of their price. Further, IBO leaders claim that purchasing Amway products

is a way for IBOs to support their upline and uphold a standard for their downlines to duplicate.

In essence, IBOs are instructed to buy Amway products to purportedly build their business and

make money through Amway’s compensation plan, which creates artificial demand for Amway’s

products among people pursuing an Amway business.

170.

In recent years, IBOs themselves have purchased more than three-quarters of the

products sold by Amway. The remainder are sold online to accounts Amway treats as customer

accounts, though many of those are accounts used to disguise IBO purchases as customer

purchases. After IBOs leave Amway, the vast majority of them stop purchasing Amway

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products altogether, which reduces Amway’s sales as well as bonuses for uplines if those IBOs

are not replaced. Accordingly, to maintain revenues and bonuses, thousands of new IBOs need

to be recruited to buy Amway products each year. Since 2020, over 100,000 IBOs have left

Amway each year, and between approximately 70,000 and 130,000 new IBOs signed up and

bought or sold a product. Most IBOs do not stay in Amway more than one year.

171.

WWG training materials call “[p]ersonal use” of Amway products a “[f]oundation

of your business,” and leaders attribute their success to it. For example, after talking about how

his house was filled with Amway products, WWG Crown Brad Duncan told a large group of

IBOs in a training session in January 2023 in the Seattle area, “We’re rich because we’ve always

used our own products.” Duncan then talked about how he used one of Amway’s facial

cleansers three times a day, along with an eye cream for wrinkles, and he also emphasized that

he does not buy non-Amway products of the type Amway sells, which are known in Amway as

“negative products”: “Use your own product. … There’s no negative products in our house.

None!”

172.

A few months earlier at an event in the Tacoma Dome, Duncan told WWG IBOs

about his “Diamond Vitamin Plan,” meaning his extensive use of Amway’s supplements, as well

as his regular use of multiple skin care products. According to an Amway transcript of the event,

Duncan told IBOs that if you had 10 people in your group who followed those practices, you

would make an “extra” $30,000 a year from the supplement purchases and an “extra” $20,000 a

year from the skin care products. Duncan went on to say he drank nine bottles of Amway’s

Perfect brand water each day from his refrigerator stocked with Amway products: “We have

huge refrigerators in our house because we’re rich. … And in one of our huge refrigerators, all it

is is Perfect water, XS, protein drinks and XS. The whole [] fridge. And I’m opening that thing

all day long.”

173.

Pursuing your Amway business by filling your house with Amway products is a

common theme in Amway. In November 2022, for example, WWG Diamonds Trevor and Lexi

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Baker posted the following video on Dreamstream of a refrigerator filled with XS drinks and

Perfect water with the tagline, “Is your fridge going Diamond?”

revor and Lexi Baker to Trevor and

Lexi Baker Diamondship

ov 11 2022 06 12 AM

174.

Similarly, IBO leaders promote the consumption of large amounts of Amway

products. In a September 2022 Dreamstream post, a WWG Diamond from Hawaii described

using or ingesting 36 Amway products before 8:00 a.m., and a few months later, Julie Duncan

reposted pictures of the handfuls of supplements IBOs take:

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Julie Cuncan to Brad and Julie

Duncan

Dec 19 2022 0 8:02 PM

PV is easy ... when you do 100% perso na l use

Before 8am I used or ingested 36

different products that amounts to 396 83PV .

13.24PV a day. From brushing my

teeth to washing my face to putting on my

makeup to drinking my morning concoction to

taking my vitam ins; every single product I used

or ingested was from ou r amazing business! Of

course I dra nk E-spring wate r and breathed in

herea ir @ Thank yo u

or y our inspiring live @ Pro

tip: dissolve collagen peptides in room temp

water to avoid clumping and then add all other

ing redi ents and add cold beverage of choice @

shared a ph oto

2h ·l:il

This is just a collage of the photos you

guys have posted so far for taking your

vitamins. If we can have team leaders do

their own collage for you- teams, it would

be cool to see the posts

shared a ph oto

175.

IBO leaders tell IBOs they should not worry about whether they like the products

because buying them will earn points and thereby help them make money in their Amway

business. For example, in a December 2023 training session in the Dallas area, an LTD leader

above Platinum, told IBOs to buy Amway products for their point value or PV: “You need to

stop compromising with your personal volume. … You eat a [energy] bar because you’re

committed. I don’t care if it tastes good. There’s a common ingredient in every bar. It’s P

frickin’ V.” Similarly, in June 2022, a WWG Diamond from Northern California, told a training

session in Washington that when she started in Amway, the energy bars came in two flavors,

“yuck and yuckier,” but she ate them anyway because it “created volume.”

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176.

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Likewise, in a January 2025 recruiting meeting in the Kansas City area, an LTD

Diamond, who used to be on the board of the IBOAI, taught prospects and IBOs that buying

Amway products for themselves is how to drive revenue for their Amway business: “Do you

know why this [Perfect water] is the brand of water that’s in my home? … Because when I buy

this, it’s revenue into my family’s business.”

177.

IBO leaders also tell IBOs not to worry about the high prices of Amway products.

In an online recruiting session in March 2022, WWG Diamond Maiko Tuitupou told IBOs and

recruits that the price of Amway’s products did not matter: “Somebody asked me this, you know,

‘How much are the products? How are they?’ They’re phenomenal, but I’m going to be honest

with you, I’ve never looked at the price because, for me, I’ve never cared, you know. Because

the way I looked at it was, if I buy these [Amway] products, I can build the life that I want. If I

buy those [non-Amway] products, I can’t. That’s just how I looked at it.”

178.

These are longstanding claims within Amway. Another LTD leader, Diamond

Doug Weir, told IBOs in a training session in Virginia in 2017 that he buys products for himself

to support his business, which he claimed generated $20,000 a month: “XS energy right now is

currently the only energy drink that has PV on it, so that’s why I buy it. … I don’t care about the

products. … Don’t talk about how XS is better than Red Bull because we don’t know if it is or

not. Right? [] I don’t know if the products are any good. I don’t care. [] I’m getting that

$20,000 a month check. The products don’t have to be good for me to get that $20,000 a month

check.” Likewise, WWG Diamond Trevor Baker has told recruits and IBOs that he and his wife

made a “business decision”—as opposed to a “consumer decision”—to buy 300 PV of Amway

products each month when they started out.

179.

New IBOs are told that buying Amway products is an important part of running a

successful Amway business, and they are pressured to actually purchase Amway products

immediately after they sign up as IBOs. In both WWG and LTD, IBOs are instructed to get their

new IBOs to start buying Amway products as part of their onboarding process. Both groups also

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encourage new IBOs to set up a recurring order of Amway products for the first day of each

month, a Day 1 DITTO.

180.

For example, in a May 2023 voice message, WWG Diamond Howard (Howie)

Danzik explained to one of his downlines that “just so we’re clear, you should be teaching” new

IBOs to purchase a 300 PV “Day 1 DITTO,” although “it may take people two or three months

to work up to that. But I’m assuming you’re sitting down and helping people put a DITTO

together, explaining why, helping people switch their household over [to Amway products],

following up with them and all that.” Danzik, who is on the Board of the IBOAI, also said that

IBOs who purchase 100 PV a month are not buying enough: “[J]ust a hundred PV means they’re

not even close to using their own product. So, [I am] assuming you’re teaching edibles [sold by

Amway] and all that.”

181.

In the late 2010s and 2020, WWG leaders and training materials explicitly

instructed IBOs to purchase products for themselves that had a total point value of 300 PV each

month. This level of personal consumption was deemed the “standard of excellence” in WWG,

and 150 PV a month was described in training materials as the “basic volume.” LTD leaders

used the same 300 PV standard and called it “Core 300.” At times, in both WWG and LTD, the

150 PV monthly standard was also characterized as appropriate for single people, and 300 PV

was deemed the standard for couples. It now costs about $500 to purchase 150 PV and about

$1,000 to purchase 300 PV of Amway products.

182.

In recent years, as reflected in communications between Amway and the leaders

of its Approved Providers, Amway executives told the IBO leaders that they were concerned the

FTC might bring an action against Amway and the Approved Providers. In response, the

Approved Providers reduced the numerical personal use standards that appeared in many written

training materials. For example, LTD’s written materials still use the Core 300 standard but

indicate that 60 percent or more of an IBO’s “blueprint” should be sold to non-IBO customers.

This translates into personal use for IBOs of about 120 PV, which costs about $400, and some

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LTD leaders began using this figure in meetings with prospects and IBOs.

183.

Since around 2021, some of WWG’s written training materials started presenting

a monthly personal use standard of 50 PV per month, but behind closed doors WWG leaders

pushed IBOs to buy more. For example, in a large training session in March 2023 in the Seattle

area, a WWG Diamond from Arizona told IBOs to consume more than 50 PV by placing a

DITTO order on the first day of the month: “So going back and talking about volume. You guys,

I just think this is, like, we just do it, right? And I think there has to be a standard. You know,

doing 50 PV a month in personal use is not a standard, you know. So talk to your upline coach,

figure out what that is for you, and then do it every month and you do it on a Day 1 DITTO.”

184.

Pressure from uplines to purchase Amway products is substantial and effectively

requires downlines to purchase Amway products to be part of their group. Uplines and upline

coaches in Amway, whose bonuses depend on purchases by downlines, have significant power

over their downlines. Part of this power comes from the important role uplines often play in

helping their downlines recruit. Uplines can withhold this assistance, such as not conducting

meetings with prospects, if they are unhappy with the volume generated by a downline, which

they can see within Amway’s electronic system for IBOs. Similarly, uplines can withhold the

mentoring that is pitched to prospects as a key reason to join Amway or ostracize IBOs from

their group if they do not meet product purchase standards.

185.

In addition, WWG and LTD try to create an environment in which upline coaches

are portrayed and “edified” as experienced, successful IBOs whose advice should be followed.

In WWG, for instance, this culture is formalized in part by the first of its five “Cardinal Rules,”

which instructs IBOs to “Never do anything for the first time without seeking perspective from

your mentor.” This directive does not just apply to product purchasing or how IBOs should run

their business. As a result, it is not uncommon for WWG leaders and coaches to give IBOs

financial advice or to discourage them from doing anything that will distract them from their

Amway business. A January 2023 Dreamstream post from Kelly and Darci Ewing, for example,

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called “moving” and “changing jobs” two of the “biggest distractions,” along with “pets” and

“trips.”

186.

The predictable result of the incentives created by the Amway compensation plan,

the difficulty of selling Amway’s low-margin products, and the self-consumption teachings of

the Approved Providers and their IBO leaders is that Amway IBOs buy most of Amway’s

products. From 2020 through March 2024, more than three-quarters of Amway’s product sales

were made directly to IBOs. In 2023, for instance, Amway’s data indicates 77 percent of

Amway’s U.S. product sales were made to IBOs.

Self-Consumption Business Model

Amway’s Awareness Of Its Approved Providers’ Promotion Of The

187.

Amway has long been aware that IBOs buy Amway products to generate points

for themselves (and their uplines) in the hopes that they can recruit a large number of downlines

to do the same for them. Most IBOs would not otherwise purchase Amway products, which are

pushed by IBO leaders as a way to create a duplicatable blueprint for recruits, rather than as a

means to having inventory on hand to sell to customers.

188.

In the mid-to-late 2010s, IBO leaders openly discouraged IBOs from selling

Amway products to customers. As a WWG Diamond explained in a 2017 recruiting event in the

Chicago area, he sold as few products to customers as possible:

“We’re not looking for salespeople. I am not and never was and never want to be

a good salesman. Do I sell stuff? As little as possible. The Federal Trade

Commission puts a retail requirement on me, which is really, really small. It’s

chump change. It’s insignificant. It represents such a tiny portion of my income

that I don’t know what I would do with it. … So there is some retail involved

here, but we’re not looking for salespeople. Nobody’s gonna to try to get you out

and sell stuff for ‘em because this is a business of duplication.”

189.

Similarly, in a recruiting meeting in the mid-2010s, a WWG Diamond from

Southern California bragged that he only had eight customers over 25 years in the business and

that four of them had never even ordered: “The legal environment in America requires that each

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business owner conduct retail sales. So, the good news is you don’t have to do hardly any in

order to be considered a legitimate business.” The Diamond then said his “goal was never to

build client volume. . . . The real opportunity here is to not to build a retail base. . . . The real

opportunity here is for us to coach and mentor you on how to build a team.”

190.

“There are no products in our meetings anymore. So, I stopped bringing any

products up. This isn’t Tupperware. Put the products away. No more demos.

It’s not Urban Dishes. Again I’m not telling you, you guys decide—they’re your

leaders. But we stopped hauling around products because I don’t care about the

products. This is a plan for going Diamond. Do you guys want to be product

experts, and peddle products for pennies? [] Or do you want to go Diamond and

sit on the beaches of the world with us? You gotta decide which business model

you want. Do you want to be a busy network marketer? Or do you want to be a

guy who gets a big check every month and doesn’t have to do anything? ‘Cause

it’s two different [] businesses.”

191.

LTD Diamond Doug Weir expressed similar sentiments in a training in 2017:

Amway was aware of this approach by the Approved Providers and the fact that

leaders like LTD’s Doug Weir viewed customer sales as “peddl[ing] products for pennies.”

Amway also knew that its own compensation plan, which creates the financial incentives for

IBOs, did not reward IBOs for customer sales and led IBO leaders to disparage selling Amway

products. As noted above, in a February 2019 slide deck prepared by one of Amway’s highestranking executives, the new IBO experience globally is described as one in which “Selling to

customers is not rewarded, not taught by leaders and difficult.”

192.

In addition, Amway acknowledged that its Approved Providers instructed IBOs to

buy a significant amount of Amway products themselves in order to succeed in the business. In

July 2019, for example, Amway’s internal profiles for numerous WWG leaders noted the

following “Insight: Lack of teaching on customer volume has resulted in an increasing disparity

between self-use and customer sales. . . .”

193.

Amway’s internal analyses of customer sales in LTD and other Approved

Providers were similar. Those analyses found that IBO leaders instructed IBOs to use the

personal consumption model and that the vast majority of Amway’s sales were to IBOs and not

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to customers. For example, the notes of the high-ranking executive quoted above for a

September 2020 presentation indicated the business has a “heavy reliance on self-consuming

distributors,” meaning IBOs.

194.

Internal Amway documents put customer sales for the late 2010s and 2020 at or

below one quarter of overall sales. For example, one internal report on customer sales for

November and December 2019 put customer sales at 24 and 25 percent, respectively. Similarly,

in a draft Amway presentation slide from 2022 concerning “Actual” sales for all of Amway

North America (“ANA”) in the years from 2015 to 2019 put customer sales at less than one-

quarter of overall sales in the pie chart below:

ANAs Path

to Growth

Pre-Transformation

ACTUAL·· - - -

Shape of the

business

Business

Building

□DD~

Self

Consumption

tS-7%

Growth

■ Customers

■ IBOs

□

Profitability

t 25%

195.

Other internal documents put customer volume at less than 10 percent of sales by

disregarding self-reported customer sales, including the bar graphs below in an Amway profile of

WWG from late 2018, in which WWG is referred to by its old initials, WWDB, and customer

sales are referred to as QCPV or Qualified Customer PV:

COMPLAINT - 66

Case No. __:___-cv-______

FEDERAL TRADE COMMISSION

One Bowling Green, Suite 318

New York, NY 10004

(212) 607-2829

Case 2:26-cv-03474

Document 1

Filed 09/17/26

2019 JI 01

Page 67 of 83

IMPACT SPOTLIGHT

WWDB

Approved Provider

WHAT YOU NEED TO KNOW ABOUT WWDB

• \NW lost their founder and mentor when Ron Puryear died in 2017. Since Ron's passing the Management Team (one representation from all the

qualified Diamond-ships) has come together even closer to continue mentoring IBO's who want to build a profitable business. Many of their

business buildi~

been used as a benchmarl< for A A. The leadership torch has been passed on to Brad and Julie Duncan

and 2ml in line,_ _ . Their business managercontinues to be a great partner lo Amway and is doing a great job

at keeping th is organization unified.

WHY WE'RE WORKING WITH WWDB

This AP continues to grow at a double digit rate each year. To maximize our efforts, ii makes sense to focus the majority of our efforts in actions

that will move the entire organization instead of only by diamond team. Learning from their methods of teaching from a business building and onboarding pers~ive could result in other AP·s implementing similar teaching for sustainable growth . As the lop growing AP, with a high% of

U35 IBO's, the opportunities for growth, more loyal buyers and new Platinum and above leaders are greal

KEY INSIGHT

WW tools speak about

customer volume, not as a

benefit but as a

minimum. This lack balance

in message surrounding

both self use and customer

vo lume is causing an

unbalanced and

unsustainable business

structure.

SUPPORTING DATA

■ Revenue

• Customer Vo/1a11e

2~0.000,000

200.000.000

150,000,000

100,000,000

50.000.000

20 16

201•3- -- --

HERE'S WHY:

Productivity continues lo Increase

disproportionately to QCPV. This

gap could be the result of messaging

around the cons istent promotion of

self consumption. If this behavior,

and unbalanced business building

practices do not changed, the gap

will continue to increase resulting in

IBO's having to work harder to

requallfy, negative exposure to

Amway, WW & Diamond bus inesses.

QCPV Alnalysis

196.

In addition, Amway was aware that when IBOs were able to “sell” Amway

products, they often did so without any profit margin. As notes from a September 2020 Amway

meeting put it, only “30% of IBOs were selling at some margin.”

197.

In the 2010s up through 2020, Amway had two rules that purported to promote

the sale of products to third-party customers. However, Amway understood that these rules were

not effective, as described above.

198.

One rule required IBOs below Platinum to either have 10 customers each month

or report that they sold 50 PV in products to customers. IBO leaders ignored the 10-customer

COMPLAINT - 67

Case No. __:___-cv-______

FEDERAL TRADE COMMISSION

One Bowling Green, Suite 318

New York, NY 10004

(212) 607-2829

Case 2:26-cv-03474

Document 1

Filed 09/17/26

Page 68 of 83

requirement, and very few IBOs had 10 customers. In 2021, for example, no more than 3,100

IBOs had 10 customers each month out of the more than 350,000 IBOs in Amway that year.

Instead, IBO leaders encouraged IBOs to submit reports to Amway that they sold 50 PV each

month to customers, regardless of whether they actually made customer sales, and Amway

accepted those reports in lieu of proof that IBOs had 10 customers. Amway employees were

aware that IBOs often faked these customer or retail sales reports. As Amway’s current Vice

President of Sales put it in a 2019 email, “I have seen awful abuses of self-reported retail sales in

the past.”

199.

The second rule nominally required IBOs to sell 70 percent of their blueprint “at a

commercially reasonable price.” However, the rule also allowed a “reasonable amount” of

product purchased by IBOs for personal or family consumption to count toward the 70 percent.

As a result, the rule itself paradoxically allowed products bought by IBOs for themselves to

count as customer sales.

The Personal Consumption Model

Amway And The Approved Providers’ Recent Efforts To Hide

200.

In the late 2010s, Amway became increasingly concerned that the FTC might

investigate its business model. Within Amway, part of this concern was driven by the FTC’s

investigation into another large multi-level marketing company, AdvoCare International, L.P.,

which Amway executives knew about prior to the publicly-announced settlement in October

2019. The FTC’s complaint against AdvoCare asserted that AdvoCare participants were

incentivized and encouraged to purchase the company’s products “regardless of retail demand”

and to “‘duplicate’ themselves by recruiting business opportunity participants” to also purchase

the company’s products.

201.

The centerpiece of Amway’s response to the AdvoCare case was to expand the

self-reporting system in which many IBOs were already falsely claiming to have sold 50 PV of

Amway products to customers each month. Specifically, Amway started requiring IBOs to

COMPLAINT - 68

Case No. __:___-cv-______

FEDERAL TRADE COMMISSION

One Bowling Green, Suite 318

New York, NY 10004

(212) 607-2829

Case 2:26-cv-03474

Document 1

Filed 09/17/26

Page 69 of 83

report that they sold at least 60 percent of their monthly blueprint to customers under a revised

version of Amway’s so-called 70 percent rule. At the highest levels of Amway and its Approved

Providers, however, the company set the nominal bar even higher. Amway executives told IBO

leaders that the company wanted them to get IBOs to report that they sold 80 percent of their

monthly blueprint to customers in order “to create the data we will need to defend the business

when necessary,” as the planned remarks of one of Amway’s highest-ranking executives put it in

connection with a webinar held with Diamonds in April 2021. In doing so, the executive

confirmed that if IBOs did not reach the 60 percent threshold, bonuses would not only be

reduced for those IBOs but also for their uplines, which included all of the Diamonds. As a

result, in early 2021, Amway leaders made it clear to Diamonds that they would lose money if

their downlines did not report making customer sales to Amway.

202.

The revised 70 percent rule nominally requires IBOs to sell at least 70 percent of

their blueprint to customers or else their bonuses and the bonuses of their uplines will be

reduced. This means that only 30 percent of an IBO’s blueprint can be for personal consumption

under the rule. However, Amway decided that 10 percent of an IBO’s blueprint could be used as

samples or in product demonstrations, yet still count toward the 70 percent. Accordingly, the

current 70 percent rule only requires that IBOs have or report that 60 percent of their blueprint

consists of customer sales.

203.

Amway illustrates the 60 percent requirement of its 70 percent rule to IBOs as

follows:

Amway does not ask its IBOs to regularly report their use of Amway products as samples or in

COMPLAINT - 69

Case No. __:___-cv-______

FEDERAL TRADE COMMISSION

One Bowling Green, Suite 318

New York, NY 10004

(212) 607-2829

Case 2:26-cv-03474

Document 1

Filed 09/17/26

Page 70 of 83

product demonstrations, which Amway calls “Sales Support,” and there is no mechanism for

IBOs to do so.

204.

In connection with these changes, Amway started calling customer sales,

“Verified Customer Sales” or “VCS.” According to Amway, VCS is the combination of

purported online sales to customers and purported cu

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