After the most extensive research ever done on MLM as a business model, Dr. Taylor has identified four (and in most cases five) causative and defining characteristics, or “red flags,” in MLM compensation systems that lie at the root of the deceptions and horrendous loss rates suffered by MLM participants. Where data is available, approximately 99% of all participants are found to lose money, after subtracting incentivized purchases and minimum operating expenses.
But before we share our list of approximately 500 MLM programs we have evaluated, in addition to some shut down by law enforcement, it is important that you do your own “5-step Do-it-yourself Evaluation.” We will not be responsible for the consequences of a decision about participation that is ultimately yours to make. (See Disclaimer tot he right.) But we are confident that here you will receive the best advice available on how to make that decision.
To begin, obtain the compensation plan of the MLM program you are considering. Then answer the questions for each of the five steps and follow the links to its conclusion. You might also want to review some of the feedback we have received.
Listed below are MLMs we have found to use recruitment-driven and top-weighted pay plans, which is the case with virtually all MLMs. For a thorough discussion of problems associated with such programs, download and read the ebook  Multi-level Marketing Unmasked (especially Chapter 2), which can be downloaded in whole or in sections from this website. MLMs listed with an arrow () in front of them have released average earnings data, which Dr. Taylor has analyzed (See Chapter 7).
(MLM’s come and go, so a few may now be defunct.)
MLMs Evaluated A – D
MLMs Evaluated E – G
MLMs Evaluated H – M
MLMs Evaluated N – R (see below)
MLMs Evaluated S – Z

See a sample evaluation

See a list of MLMs law enforcement has shut down or issued sanctions against

NAA – National Agents Alliance
Narc that Car
National Lending Corp.
Native American Nutritionals
Natural Air Products
Naturally Plus
Nature’s Own
Nature’s Pearl
Nature’s Sunshine
Network Marketing VT
New Face of Wealth
New Image
New Quest International
New Vision USA
NHT Global – Nat’l Health Trends
NMC (National Motor Cllub)

North American Power
Nouveau Cosmeceuticals
Nouveau Riche University
NSA (Juice Plus)
NuLegacy Rx card
►Numis Network
►NuSkin Enterprises, Inc.
NWC (National Wealth Centers)

Ohana Health
Online Exchange
OnPoint Direct
One Viz
►Orenda Int’l
Organo Gold
Origami Owl
Our World Network

Pampered Chef
Pangea Organics
Passion Parties
Passport LLC
Pharmanex (Nu Skin division)
Pink Papaya
PM International AG
Polaris Global (was Liberty
League Int’l)
Power Mall
Premier Designs
Prepaid Legal
Prepaid Living
Primerica Financial Services
Princess House
Private Quarters
ProActiv (Empower Network)
Protandim (Life Vantage)
Prixdale Ventures
Pure Romance
Purse Party

Qing Mei
Qing Mei (cards)
QL Exchange
Qnet (was GoldQuest)
Quixtar (formerly Amway –
now Amway again)

Rain Nutrition
RBC Life Sciences
Refer Life
Rend Ltd.
Resorts 360 Vacation Club
Retire Quickly
Rev Up Daily
RMP Infotech
Rodan & FIelds – Victoria
Skin Care
Royal Body Care
Royale Business Club

NOTE: This list includes only those MLMs for which we have obtained and evaluated compensation plans. Most of the MLMs were listed following requests for information by website viewers.
 MLMs, or product-based pyramid schemes, employ compensation system that reward recruitment more than actual sales of products to persons outside the network of participants. So significant income is unlikely without recruitment of a large downline, which requires deceiving recruits into believing it is a legitimate “business opportunity – and persuading them to invest in inventory (front-loading) and/or to subscribe to ongoing monthly product purchases or payments to “do the business,” to “be a product of the products,” etc. For purposes of analysis, any MLM could also be considered a “product-based pyramid scheme;” i.e., a pyramid scheme that requires purchases of products to participate in commissions or advancement in the scheme, rather than a cash investment such as those required for no-product pyramid schemes. Product-based pyramid schemes do far more damage than classic, no-product  pyramid schemes, by any measure – loss rates, aggregate losses, and number of victims.


8 Comments on “MLMs with 4 red flags of a product-based pyramid scheme (N to R)”

  1. toolbelt

    In the case of Primerica, over 1.5 million have joined then left since 2009 alone! The bottom 50% churn n burn annually, while maybe the top 3% earn good incomes. Those in between are on the bubble of whether to stay or go depending on anticipated performance.

    1. JonMTaylor

      You will find Rodan & Fields listed under MLMs evaluated with “4-red flags of a product-based pyramid scheme.”

  2. John

    NHT’s North American strategy is recruiting Chinese almost exclusively. Packaging and literature is in Chinese. The product sales is a secondary activity, and this would be easy for someone attending a meeting to ascertain. I’m surprised that the authorities haven’t audited them because they need to be closed down.

    1. JonMTaylor

      Your comments are very perceptive. And you are right about the need for them to be shut down. Unfortunately, regulators responsible for protecting consumers typically lack the skill, the will, and the resources to meet the challenge of massive MLM fraud.

  3. Nightowl2548

    I first became aware of this MLM scam stuff from Tom Leykis denouncing it as a Ponzi Scheme on his radio show in the early 2000s with one dummy after another calling to ask him what he thinks about their “business opportunity.” Sure enough, I soon noticed signs on telephone poles about “Work From Home call XXX-XXX-XXXX” spam on comment boards, etc. and suddenly it all made sense. Now I am a person who couldn’t sell food to an Eithiopian, heck I bet I couldn’t even give away free heroin to a jittery addict, so I’ve never been susceptible to the idea that I could get rich selling junk to family and friends. Learned that lesson in High School with the mandatory “fund drives” they made us do where only the popular kids got any donations and I had to put my own damn $6 into the can to meet my quota to qualify for the so called “Honor Society.”

    Well at work sure enough MLM has reared it’s ugly head. First case was a dude’s girlfriend started her own “business” having parties selling of all things dildos? She was going to get rich in the sex toy industry, of course no one in their right mind would buy something like that from someone they know. He passed around these catalogues of plastic phalluses to coworkers who either treated it as a joke or were aghast at the affront! Of course she had to “invest” in a starter kit and they ended up with a $1000 of rubber dicks collecting dust in their garage. I assume that recruiting others was also part of this plan but never got the full details as the scheme was addressed to women.

    Second is a little schlemiel who did time for molesting his little brother (and is highly susceptible to the allure of being your own boss. i.e. not have to try to gain employment with that whopper in your background.) He is peddling Nerium, some ridiculously priced lotion with a toxin that causes inflammation. He is gushing on about how he was soon going to be making $4K a month, etc and some other dumb ex-cons and their lowlife girlfriends were interested in getting in on this “business opportunity.” When I was skeptical and asked some other coworkers 6 months later “How’s X’s Pyramid Scheme going? Did he learn his lesson yet?” they acted like I had committed some terrible social affront and corrected me “you mean his BUSINESS.” NO IT’S NOT A BUSINESS, IT’S A PONZI SCHEME. Heard his older brother ordered some of this $100 snake oil from him out of sympathy thinking it was a one time purchase and was horrified to find it keep arriving in the mail and his credit card kept getting charged month after month. Well, now he F*d his other brother too. Over a year later this “business owner” is busy working 70 hour weeks at his normal job and talking about how with the overtime he will finally pay off his older model used car, so my only conclusion is he didn’t make any money off this snake oil and probably spent way more than he made with auto orders for his “distributorship,” buying training materials, and all the conventions he was always going to on the weekends. A good question to ask is what kind of company would really want to go out and recruit a paroled child molester into it’s organization? Only one who wanted to sucker him out of his money.

    1. JonMTaylor

      Thank you for those insightful comments. If only more people approached by MLM recruiters would think more critically about the newest “opportunity of a lifetime.”

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