On September 17, 2026, the Federal Trade Commission and the State of Washington announced a proposed $225 million settlement with Amway Corp. and two of its largest approved-provider groups, World Wide Group LLC (WWG) and Leadership Team Development Inc. (LTD).
If you work in network marketing, run an MLM company, promote an opportunity, or build websites for this industry, this is worth paying attention to. Not because every MLM operates like the conduct alleged in this case, but because the complaint and proposed order give us a very current look at the practices regulators are scrutinizing.
The FTC says this is the largest monetary recovery it has obtained in an action against a multilevel marketing company.
What the FTC and Washington allege
The government’s case against Amway, WWG and LTD centers on earnings representations, product purchasing, retail sales, recruiting and paid training.
According to the FTC’s September 17 announcement, the complaint alleges that prospective Independent Business Owners were given misleading impressions about the income they were likely to earn. The FTC says most people who joined WWG or LTD after 2020 spent more on Amway products and training than they received from Amway.
Washington’s Attorney General said the complaint alleges that only about 1% earned the more-than-$40,000 annual income that was promoted by the two groups.
Those are allegations in a complaint, not findings I am making myself. The FTC currently lists the case as pending, and the stipulated final order takes effect when approved and signed by the federal judge.
The part MLM companies should really pay attention to
The $225 million number makes the headline. I think the proposed operating restrictions are more useful for anyone actually working in this industry.
The complaint alleges participants were encouraged to buy set amounts of product every month and recruit others who would duplicate that behavior. It also alleges that participants were instructed to report products as customer sales when those sales had not actually occurred.
That distinction matters. A company selling real products does not automatically answer the regulatory question. The government is looking at what is actually driving purchases and compensation: genuine consumer demand, or purchases connected to participation and recruiting.
The proposed 70% resale requirement is hard to ignore
Under the proposed order, Amway IBOs would have to resell at least 70% of the products they purchase from Amway each month. Recruiter compensation would also be substantially reduced when recruited IBOs buy products but do not resell them.
Customer sales would have to be reported promptly at the actual selling price, Amway would send receipts to customers, and Amway would have to terminate participants who fake sales or teach others to do it.
An independent outside auditor would regularly review the company’s sales records.
That tells me something important: documentation matters. It isn’t enough for a compensation plan or marketing page to say that retail customers are important. Regulators can look at what participants actually buy, what they actually resell, how sales are recorded and what behavior the compensation system rewards.
Earnings claims are still a huge MLM issue
This is another area where I think MLM website owners and distributors need to pay close attention.
The complaint alleges prospective participants were told they were likely to earn substantial income, including more than $40,000 per year, replace a full-time job or retire early. The government alleges the actual experience of participants did not support those representations.
This goes beyond putting a tiny income disclaimer in the footer.
If your website, presentation, social media posts or recruiting funnel talks about financial freedom, replacing a job, quitting a job, retirement, lifestyle income or specific earnings, you should understand the FTC’s guidance on multilevel marketing and earnings claims and have qualified legal counsel review claims when appropriate.
Training was part of the case too
One thing I found especially interesting is how much attention the complaint gives to training.
The complaint describes paid subscriptions, messaging services and events sold through WWG and LTD. It alleges some participants could spend thousands of dollars per year on these systems.
Under the proposed order, Amway would have to require approved providers, including WWG and LTD, not to charge new IBOs for training or services during their first year.
That is something MLM companies, field organizations and training providers should notice. Regulators are not necessarily looking only at the compensation plan itself. The surrounding ecosystem can matter too.
This doesn’t mean every MLM is illegal
Whenever a major MLM enforcement case happens, people tend to run to one of two extremes.
One side says it proves MLM itself is illegal. The other side says it means nothing because products are involved.
Neither is a useful way to read this case.
The FTC brought specific allegations against specific companies and proposed specific restrictions aimed at the practices described in its complaint. Anyone operating in this industry can learn more by studying those details than by arguing over labels.
If you run an MLM website, I would audit it now
I have been building MLM websites and tools for years, and cases like this are a reminder that the website isn’t just decoration. It is part of how an opportunity is represented to prospective participants.
I would review the language on opportunity pages, compensation-plan explanations, landing pages, distributor pages, testimonials, training pages and recruiting funnels.
Look closely at statements about income, financial freedom, replacing employment, retirement, how quickly someone can succeed, typical results and how much recruiting is emphasized compared with genuine customer sales.
And don’t assume adding a disclaimer automatically fixes an unsupported headline. The overall impression of the page matters.
I think MLM technology needs better compliance tools
This case also has me thinking about something we can build here at MLMPage.
Most MLM software focuses on genealogy trees, commissions, replicated websites and recruiting. Those things matter, but there is room for tools that help companies and distributors identify potentially risky marketing language before it becomes a problem.
I’m looking at the idea of an MLM Compliance Checker that could scan a website or opportunity page for things such as earnings claims, lifestyle claims, recruiting-heavy language, missing context around income representations and other wording that deserves human review.
It wouldn’t tell somebody that their MLM is legal. Software can’t replace an attorney or determine legality from a webpage. The goal would be much more practical: flag language worth reviewing and connect users with the relevant FTC guidance.
The $225 million settlement should get the industry’s attention
Amway is one of the most recognizable names in network marketing. A proposed $225 million settlement involving Amway and two major training organizations is therefore significant beyond the companies named in the lawsuit.
The lesson I take from the documents isn’t “MLM is dead.” It’s that companies and participants should pay very close attention to what they promise, what participants actually earn, what drives product purchases, whether retail sales are real and verifiable, and how recruiting and training systems operate in practice.
If you operate an MLM business, promote one, or build MLM websites, this is a good time to read the government’s documents yourself rather than relying on social-media summaries.
You can read the FTC case documents here and the Washington Attorney General’s announcement here.
This article is for general informational purposes and is not legal advice.