Inside the government plans to shutdown the direct sales industry: Vemma is only the begining

September 10, 2015

The Arizona direct sales company Vemma was recently hit by the FTC and virtually shut down without a judge, jury or trial.  The income of thousands, including single mothers, housewives, young businessmen, retirees and disable veterans has been instantly blocked by the government agency.  Nobody will be paid, no matter what they have sold or how many years they have worked.

Ominously, among the reasons the FTC gave for its action, are methods that are employed by almost all other Direct Sales companies.  If Vemma is unable to survive, it could spell the end of a vibrant industry that involves 18 million Americans, 74% of them women.  It may be the last loophole allowing an ordinary person the opportunity to earn extraordinary amounts of money.

What is behind this action?

Money.

Shortly after the re-election of Barack Obama a former law enforcement – corporate security specialist called me with some interesting information.  A friend in the Justice Department was asking him for details on Multi Level Marketing companies in Utah.  They were talking names, income, the nature of their compensation plans and any questionable claims about their products.  They would welcome any gossip about lifestyle too.  Mistresses?  Lavish meals?  “Ahh, gonna take out a source of Republican money huh?” my friend joked.

It is no big secret that most entrepreneurs, including the kind who get into MLM’s, tend to be Republicans.  Just as people who believe that government has the solutions for society, tend to get jobs in government.

Rich DeVos, the co-founder of Amway one of the nation’s most successful MLM’s, was a major donors to both the Reagan and Bush presidential campaigns.  Frank VanderSloot, of Melaleuca, was the finance chairman and a $5 million fundraiser for Mitt Romney.

I have been an eyewitness to the political power of these companies and their sprawling networks of independence entrepreneurs.  In 1984, when Ronald Reagan announced his re-election, he did so at an MLM event at the Atlanta Georgia Dome.  Distributors came to the Dome for a weekend of seminars and forfeited the platform to the Reagan Campaign during the afternoon.  In another city at yet another event, I spoke just before Reagan to an audience of 10,000 MLM builders.

During the election campaign of George H.W. Bush I would often get a call from campaign manager, Lee Atwater.  “I need 500 people with signs cheering for Bush outside of Butler aviation in Raleigh Durham.”  Atwater would give me five photo ops with Bush at the foot of the airplane and in return the five MLM leaders would guarantee the crowd as requested.  In 1987, George W. Bush, working his dad’s campaign,  spoke at an MLM event I arranged, helping to funnel distributors into campaign workers.  It is not unlike what the unions do for the Democrats.

I have also been one of the pack who got the message from the top of the network.  In 2008 I was building a network in XanGo when word came down to make a $1,000 donation to Mitt Romney.  I complied.

It was only a matter of time before Obama would shut down this industry, which is a vibrant part of the economy of every other major western nation and flourishes in Russia.

There are many complaints about MLM.  The odds of success are not high, although probably a lot higher than a career in journalism or professional sports or Hollywood or – for that matter – the FTC.  The difference is MLM will take anybody and most other opportunities won’t.

In recent years the culture of MLM has diversified.  Shaklee, for example, the MLM vitamin giant, is owned by a Democrat billionaire who is a friend of Oprah Winfrey.  It will probably be the last one taken down and may even be permitted by the Obama administration to live out its retirement, as long as it remains quiet.

The danger for other MLM’s is the nature of the attack on Vemma.  They have been hit hard on “auto-ship” a policy that has products automatically shipped to a distributor unless he or she opts out in advance.  That, the FTC, contends, makes it a pyramid scheme.  Most former members of the Book of the Month Club or the Literary Guild are familiar with auto-ship.  If you signed up you got a book every month.  You could opt out but if you didn’t you had to pay for the book or send it back.  In our new “victim society” the FTC has determined that this is illegal.

It was also wrong, they say, that Vemma prospected college students.  Universities are now places where beer pong is a sport, abortions are choice, date rape is so rampant that universities refuse to publicly publish the numbers but selling vitamins to your roommate is now a crime.

(Donations to defend the industry should go to the Direct Sellers Defense Fund, Morrie Aaron: maaron@mca-financial.com)

 

Advertisements

MLM Hall of Fame

May 18, 2009

Having traveled the world for many years now and spoken at networking conventions and met and known many of its leaders, here is my own subjective list for a networker’s hall of fame.

I have not included many of the legendary founders, like Rich Devos, Jay Van Andal, David McConnell, Mary Kay Ash, Mark Hughes, nor did I include the popular speakers, Jim Rohn, Zig Ziglar, Billy Zeoli and Robert Kiyosaki.  Maybe someday I will do those lists.  But each one of the following men and women actually built their own significant, personal networks into the hundreds of thousands.

Many on this list have made mistakes but so to have most of the rest of us.  And some have done extraordinary things for their countries and the world. They work with different companies and each have their different ideas and personalities.  What they have in common is uncommon results.

Nowadays, there are many phony “trade lists” of income earners floated on the internet by shill websites.  Some of them list names of leaders who have been paid out huge sign up bonuses.  Some have never sponsored a single person themselves. But I have met most of the people on my list and spoken to their groups in coliseums or soccer stadiums and been in their homes and I can say that their accomplishments are real.

Doug Wead’s Networking Hall of Fame

Robert Ankasa: This former vice president of the Bank of America in Jakarta has built the largest network in Indonesia and has filled soccer stadiums and auditoriums across the fourth largest nation in the world.

Jeff Boyle: Founder of Jus, he is included in this mix because he actually built his company’s own networks. Young. brilliant, with a big heart.  No one knows the science of networking any better.  He is the Alvin Toffler of the industry.

BK Boreyko: He hailed from a family that built one of the largest organizations in the Matal Company and when a corporate crisis occurred he stared his own company, New Vision, which reached the $100 million sales mark in record time.

Bill Britt: At one time his organization may have represented half of all Amway volume.  He transformed the networking systems by being the first to build his own cassette manufacturing company.

Craig Bryson: He is Nu Skin’s biggest lifetime earner and one of the industry’s greatest storytellers.

Bill Childers: He built the largest, single, cohesive group in networking history.  His secret?  He insisted on always appearing as the second man to his upline, even when his own group was at times much larger.

Jim Dornan: The founder of Network 21 has the largest and most efficient system business in the world. His organization has donated $100 million to World Vision..

Tim Foley: He defied the accepted wisdom of all the other North America networking leaders and proved that system networks could be profitable outside the United States building giant groups in Brazil and Spain.

Attila Gidofalvi: This Hungarian businessman is the father of networking in the former Soviet Union, Attila built 120 Amway diamonds in two years and held meetings at Olympic Stadium in Moscow.

John Godzich: He built a network in France and then a company that reached $200 million in sales in two years and annually filled Bercy, the largest auditorium in Paris, four weekends in a row.  80% of the money was made from retail sales, allowing new people to make money too.  It is still an industry record.

Hal and Susan Gooch: They hosted some of the largest networking events in the United States, filling the 90,000 seat Indiana Hoosier Dome on multiple occasions.  While most wives of American networkers were limited to roles as “speakers,” Susan played an integral part in the organization of the business.

Bob Goshen: “Mr. Enthusiasm,” he was the first system’s person in Sunrider and drove its success.

Brig Hart: Already very successful in networking, he felt cheated by his experience and joined a new company.  Brig proved wrong the old networking adage that successful networkers are too soft to build it twice and took his new company, MonaVie, into the stratosphere, making himself a legend in the process.

Randy Haugen: He had a great run in the west.

Don Held: In his heyday he filled coliseums in Ohio and Canada, and launched an educational system, showing that a network can do more than just make money.

Dave Johnson: He is the giant of Nikken. Supposedly 99% of the company is in his downline.

Charlie Marsh: An early Amway pioneer. He organized the first events and functions. In some respects he is “the father of network marketing.”

Norman and Glenda Leonard: Masters of depth.  By some estimates there are 300 diamonds in their organization including all of Amway Russia, most of Eastern Europe, half of Indonesia.  They divorced in 2007.

Ken Pontious:  He was top earner with Enrich, was once taking home a monthly income which was twice the annual salary of the president of the United States.

Vladimir Pozdnyakov: He is nicknamed “The Poz” by his American colleagues, he is one of the new Russian millionaires, who developed a network out of trust, in a difficult environment.  His groups fill auditoriums.

Ron Puryear: He built one of the largest networks in the Britt system and for awhile, ruled in the northwest USA, filling the largest coliseums in Portland and Seattle to capacity..

Kaoru Nakajimi: He has more than 700,000 in his downline.  He built Amway in Japan.

Art Napolitano:  Top earner at ACN. Built  an organization to 500,000 customers that bill into the millions.

Nathan Ricks: The charismatic legend who helped build Nu Skin.

Mitch Sala: He is the great Australian networker who solved the problem of isolation downunder by exporting his business worldwide. Sala has one of the most geographically diverse groups in the world.

Max Schwarz has built networks east and west and has adapted to numerous changes in mlm systems.  He is a survivor.

Rick Setzer: He was once the third leg in the Yager-Britt stool.  Great systems knowledge.

Bo Short built all over again three times and each time  built a leading organization within his respective company.

Sherman Unkefer: A legend in XanGo, with an estimated $350,000 a month income off his XanGo business, Sherman’s simple prospecting package called “The Magic Wand,” helped him build a resilient networking business in only a few short explosive months.  No one has reached the top quicker.

Don Wilson: He succeeded by hard work.  Yager didn’t like flying on airplanes so Wilson soon owned the Yager system in the west.

Dexter Yager: The father of the so called “system,” he may be the greatest networker of all time, he has not only built one of the biggest organizations, he has maintained it big for the longest time.  His secret?  He keeps starting new groups and for years he has outworked everybody else.

Mark Yarnell: Formerly of Nu Skin, he is networking’s thinking man and its most prolific chronicler.

Natasha Yena: A wise and resourceful strategic thinker, Natasha is the mother of all Russian speaking networkers, Her events fill auditoriums across Russia and Ukraine and have spawned dozens of other networking women leaders with enormous businesses of their own, clearly disproving the misogynist declarations of some American networkers who insist that women can’t build the business by themselves.  Indeed, in Russia, it is mostly the women who do.

James Vagyi: He is a Hungarian whose business exploits put him on the front page of the Wall Street Journal.  He successfully launched networking in Hungary, Czech Republic, Slovakia, Poland, Ukraine, Russia, Moldavia, Belarus, Romania, Slovenia and Croatia, making him “the networking father of many nations.”  And while others have appeared and died in some of those markets, Vagyi’s groups continue.

Jody Victor: He proved that networking can survive and even thrive into a second generation. Victor has seen the dozens of seismic changes in networking and landed on his feet each time.

Orrin Woodward: He took the so called “systems building” to its ultimate extreme.

George Zalucki:  One of the world’s most inspirational speakers and trainers.  He built a $150 million business with 150,000 distributors for ACN  in
Europe.

Даг Вид