Recent reports say that the popular MLM company Vemma has been temporarily shut down. For what you might ask? No, not for embezzlement, not for dangerous products, but because Vemma was “operating a pyramid scheme that promised college students riches” (abcnews.com).
Really? The FTC can go after a company for selling a product and offering income opportunities for advocates and distributors of the product? This sounds like one of those stories where we might not see what is going on in the back offices of the FTC… After all, it’s not like the government has ever gotten involved in situations to cover their ass on corrupt operations (wink wink).
In most peoples’ eyes, what happened to Vemma was pretty messed up. We are talking about a company that earned $200 million in 2013 and 2014 (according to the FTC). There are a lot of people that were making money with the company, and a lot of people that enjoyed the products.
Vemma makes a popular protein shake called Bod-e and an energy drink called Verge. Just like the MLM company Jeunesse, customers in Vemma have the opportunity to refer their friends and become authorized distributors of the product. This is where the income opportunity presents itself.
Of course a college student is going to be on board with an opportunity that could make them thousands…and most people entering into the MLM business are aware that what you put into the system is what you get out of it. There are no reports that students were guaranteed “x” amount of profit when joining…yet the FTC took it in their own hands to halt the operation of the company.
The FTC said Vemma “provided little help on how to sell its products and instead rewarded [recruits] for recruiting more people” (abcnews.com). I never knew that it was under legal obligation for an MLM company to train their distributors how to sell the products…
In fact, also in the battle between the FTC and Vemma, the FTC said Vemma’s employees “visited college campuses and told students that selling the beverages was an alternative to a regular job. Its marketing materials features young people in luxury vehicles, jets and yachts”. Yeah, yeah, we have all seen those advertisements with the young guy in shades surrounded by the sexy women, Ferrari’s, and yachts. But now it’s okay to shut down a multi-million dollar company for that? Sounds a little fishy to me…
The federal court in Arizona has gone out of their busy way to “temporarily seize” all of the company’s assets. The Vemma website shows that all of their products are temporarily unavailable at this time… Great. I’m glad that the government has all of their large issues taken care of (national debt, foreign policy, healthcare, secure borders, etc.) so they can focus on shutting down entire businesses in their own country that aren’t adequately training their distributors…Read more →