Forever Living Products International, LLC

The company’s own data

Forever Living is a multilevel marketing company whose participants, called Forever Business Owners, sell health and wellness products and recruit others to do the same. The FTC’s case rests almost entirely on Forever Living’s own numbers.

In each of the last five years, at least 77 percent of participants who bought, sold or recruited during the year received no compensation at all. Even after two full years, more than 89 percent of new participants had not earned enough to recoup their initial start-up cost of $300 or more. Fewer than 7 percent received any income from the purchases and sales of the people they recruited, the “downline” the opportunity is built around.

What was promised instead

Through in-person meetings and conferences, social media posts and videos, and print materials, the company used images of luxury cars and giant checks and claims of earnings ranging from extra income to replacing a full-time job. In one marketing video the company president told viewers: “We will be paying millions in bonuses next year. The only question is, whose name goes on that check?”

Training materials encouraged participants to show photographs of cars received through the incentive program and destination events they had attended, and to say “this is a business where you can earn a lot of income.”

The disclosure statement

For years, the FTC alleges, the company’s public income disclosure statements implied that everyone pursuing the income opportunity was making money, and that others had merely “joined” to buy products at a discount and had “elected not to participate.” The company knew nearly 90 percent of participants had received no income, and had no basis for suggesting they were not trying.

The order

Forever Living, chief executive Gregg Maughan and president Aidan O’Hare must hold substantiation for any earnings claim and provide it to any U.S. consumer who asks. They may not misrepresent what participants have earned or are likely to earn, may not misrepresent the reasons participants do not make money, including by claiming they were not trying, and may not misrepresent how likely recruitment is.

What is not established

A stipulated final order resolves the allegations without any admission or finding of wrongdoing.