Skip to comments.Who wants to be a millionaire: Is Herbalife a pyramid scheme?
Posted on 02/22/2013 12:31:21 PM PST by iloveamerica1980
No doubt you've heard certain radio commercials about a company called incomeathome.com. I recently found well researched information below which demonstrates that is in fact a pyramid scheme. Don't fall for it! I am really disappointed with certain national personalities like Sean Hannity who continue to vocally endorse this product. The only way to be formally introduced to this system is by purchasing an International Business Pack ("IBP") for $60.00. And that's just to get your foot in the door. Apparently the full training package is much, much more expensive. Isn't is nice to know that the top 1% of Herbalife distributors receive 88% of the rewards. This site is a collection of information that originated from Herbalife or independent third parties such as the media: http://factsaboutherbalife.com/. It contains a complete copy of the presentation and webcast presented by Bill Ackman, Founder and CEO of Pershing Square Capital, at the Sohn Conference Special Event.
Herbalife has been around for a long time, hasn’t it?
yes, and it was a pyramind scheme when I was a distibutor in the 80’s
Most of these ‘network marketing’ companies are just pyramid schemes using different names, terminology, and tweaking the program just enough to not fall under the legal category that could get them shut down.
On of my major papers I did when working on my Master’s degree was to study the financial operations of many of these companies (herbalife wasn’t one but it operates much the same as many of them). I found most operate under a system that only works if the ‘employees’(sic) have a high failure rate, that is they buy into the program with its large start-up costs then don’t fail to achieve the goals to receive any payout benefit from their network.
The products they sell are just a secondary thought. The real business is to sell the business opportunity, get people in and investing, then have them drop out before significant revenue flows to them. It was shocking to see how some people have invested thousands upon thousands of dollars and hours and received pennies in commission. They were always looking for that next ‘break’ that would fill their pyramid (or binary, or network, or whatever it was called with that program) that would start the money flowing.
These type of programs benefit very few. Just a couple of people at the top and the few downline who buy into the program who are more savvy at playing the game.
I suggest avoiding them at all costs.
(note, I did find a couple whose finances and history showed benefit to the people who buy into the business. They usually were ones who had real, established product lines that were focused on first, not buying into the business as the goal (Mary Kay being one of the few ones with decent financials)).
Yes, its a scheme. Glenn Beck also supports it which is disappointing.
Unfortunately the parent company of many of these schemes have advertised on Beck, Hannity, and Rush. They all have the same pitch, ‘work from home opportunities’. I hear their advertisements on a daily basis.
Actually, I finally googled incomeathome.com. I found a guy that had put a lot of work into a site exposing these guys. After paying his ten bucks and deciding it wasn’t worth it he told them never mind.
They told him no problem. Just sent the dvd back so that the $10 trial doesn’t become a $49 purchase.
That right there tells you they are sleazy. They know people won’t bother.
Herbalife is a huge supporter of US Senator Tommie “The Commie” Harkin (Democrat, Iowa). It is a multi-level marketing operation, though the actual products are OK but pricey.
Anything that requires you to “bring in other people” and not emphasizing “selling product”......is a Pyramid Scheme
I got burned in one of these two decades ago with one run by Kevin Trudeau.....who sells those “.....Cures” books on TV. In fact the state of Florida shut him down in FL
Any radio show host who pushes pyramid schemes should be ashamed of themselves.
And....with so much business done on line...no one should even consider pyramids
I thought so! I knew a guy, in Wisconsin, in the early Eighties that was rakin’ in money hand over fist!
If Herbalife was a pyramid scheme the feds would have them in court as we write.
I somehow got stupid and went to the website and it hijacks your browser and won't let you use the "back" button. I had to close the tab to get out of it. GGGRRRRRR!!
Not only that it is also the Cult mentality they force upon their down line distributors. Such as claiming they aren’t selling enough because their spouse isn’t doing their fair share, or you aren’t living right because you didn’t spend 500 dollars on toliet paper to save a dime.
They then flood them with visits, emails, phone calls strongly suggesting that they need more training thru weekend seminars. Which is put on by the Top of the Pyramid shysters who hard sell videos, DVDs, tapes and other “self Help” materials.
These weekend seminars end up costing people minimum a couple of hundred plus several hundred for the “training” materials.
I watched two friends destroy their lives listening to these cult personalities. I tried to tell em...
I have never sold or bought Herbalife but I've never heard any scandal on the company. They've been around a long time.
Actually, there were other cases that caused Scamway to move their business model overseas and rebrand it as Quixstar or something like that to avoid the Federal rulings. Matter of fact most of the scamway distributors were hawking it claiming it wasn't scamway...PR was so bad they finally started admitting they are in fact directly associated with scamway.
A quick google seach will reveal much to those that want to see...
Till one day the Feds found out on her spare time as a tax preparer or CPA, she learned who had money to invest so she was running some kind of investment scam like Madoff she was cooking books. She got busted for that AND turns out her husband had bought or built a warehouse that all that scamway product that they supposedly had sold was stored in.
It was a great story about how many that claim to be "stars" in the multilevel marketing business are nothing but scammers and charletons.
Another company I like is Malelueca (sp?) I love their oil, laundry products. and their furniture polish is THE best.
I don't care about the marketing plan as long as I like the products and think I'm getting ny $$$ worth!
The people I had interviewed had the biggest complaint about the pressure to get their friends and families to pitch meetings. Many had lost friends or isolated family members due to this or worse, them getting ripped off by these programs. One actually had one of his ‘up-levels’ look up a person’s family and without his knowledge, invite all of them to a pitch on his behalf.
...or 'network marketing' or 'binary marketing' or 'friends helping friends' or 'associate network building'.
They always cloud it with new terms when the old one goes out of favor.
Some network marketing companies are better than others. I am involved with LegalShield (formerly Prepaid Legal), largely because I was laid off in 2010 and most employers in Kentucky are not interested in hiring people with college degrees and high-tech skills. LegalShield is not a get-rich-quick scheme; it will work for you if you will work for it. To those leery of pyramids, I will say the following. First, I understand your concern; as an historian, I know that even the pharaohs got burned in the original pyramid scheme (they all were robbed eventually). Second, it is possible in LegalShield to make money without recruiting anybody; we have a fellow named Rob Vest who made $600,000 in 1 year on sales alone. Third, it is possible to make more money than the person who signed you up; I have a person on my team doing that. Contact me if you would like to know more.
^^ This ^^
The key thing is whether they are actually selling a tangible product and whether or not the claimed sales/profit is accurate. Nothing against multi-level marketing. Why shouldn't a person who does well selling a product not get compensated for finding another person to sell as well. The only time it's a problem is when the projections for income are fraudulently presented and the high sales claims are actually sales of new associate starter kits.
If there is actually a product, and a reasonable percentage of sales are to people who actually use the product, it's all good. If most of the sales are in the form of starter kits, it's not. I have been solicited a couple of times for similar plans. My #1 criteria was whether there was a reasonable demand for the product being sold.
Hint: If the person trying to sign you up hasn't actually tried to sell you any product, it's very unlikely that you are gonna make any money.
Snake oil is still snake oil and it still fools, fools.
Silpada Jewelery, Amway, Mannatech, Tupperware, are all “multi-level” marketing. A pyramid scheme by another name.
Amway also changed its name to Quixtar for many years because people figured out it was a Pyramid. No need to wait for Big Government to tell you so
Anything that does not emphasize selling a product is a Pyramid
In the early ‘70’s (’70,’71?) we became Shaklee Products Distributors. Back in those days Dr. Shaklee was still with his company. As I recall, he always worked with nature. Not talking ‘organic.’
We have not ‘distributed’ for years.
Only because we moved on - slowly but not purposely, just drifted away - using additional supplement brands after researching, grandchildren being born, etc.
We loved the cleaning products we used - still use Basic H.
The skin care products and makeup were the best.
A woman I know swears by the supplements she uses currently - her health would be weaker if she did not take the supplements, whichever ones they are. I’m not her distributor.
Others loved the pool product.
Spouse and I had been into nutrition before we knew about Shaklee, so we were open to the invite to a meeting - loved it. And climbed aboard. Back then, these sorts of meetings, with most direct sales products, were not all the razzzamatzz they’ve become.
We never felt/were pressured.
I also believe, back then, the financial program was sound, clear and honest.
Have no idea what’s happening now.
One of my college profs in Michigan made a huge amount of money selling Amway (this was early in the game and he developed a big downline).
One of my fellow students got excited by this, and signed on with an up and coming rival (Bestline Products). He wound up with a garage full of laundry soap he couldn’t sell.
I don’t know if it is a scheme or is not.
But I’m a huge fan of Kyle Bass.
Kyle Bass says don’t bet against Dan Loeb, who is long on HLF, as is Carl Icahn.
In our position at Shaklee (assistant supervisor or something), we didn’t have supplies like that ‘in the garage.’
People ordered, and were content to wait.
Those truly were fun days.
See post 26.
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