Amway Agreed to $225 Million Settlement for Deception
The company and two affiliates settled allegations of using unfair recruitment tactics and false earnings claims.
Updated on Sept. 18, 2026 in Financial Crime
Live Poll
Do you trust that multi-level marketing programs offer a fair opportunity for people to earn money?
Amway and its affiliates, World Wide Group and Leadership Team Development, have agreed to a $225 million settlement to resolve accusations of deceptive business practices. The settlement follows a lawsuit alleging that the entities prioritized recruitment and bonus generation over the actual sale of consumer products.
Why it matters
The case highlights the regulatory focus on multi-level marketing operations that rely on misleading earnings promises to acquire new members. This payout represents the largest monetary recovery from an MLM company under a Federal Trade Commission action.
The complaint was filed in the U.S. District Court for the Western District of Washington. The settlement resolves allegations that the defendants violated the Federal Trade Commission Act and Washington's Consumer Protection Act.
The players
Amway
Amway is a multi-level marketing company that sells health, beauty, and home care products through a network of independent business owners.
Federal Trade Commission
The Federal Trade Commission is an independent agency of the United States government tasked with protecting consumers and ensuring competitive markets.
The details
The FTC alleged that the defendants pressured recruits to purchase products to inflate bonus revenues rather than for retail resale. Official data for 2023 shows that fewer than 1,600 out of 241,000 independent business owners earned $40,000 or more, representing about 1 percent of participants.
Timeline
September 17, 2026: The complaint was filed and the settlement was formally announced.
2023: This period was used as the benchmark for IBO bonus performance data.
Legal Context
This settlement follows a consistent trend of increased regulatory scrutiny toward multi-level marketing business models. It marks a significant milestone in how authorities leverage the Federal Trade Commission Act to prosecute systemic deceptive practices in the industry.
The settlement requires the company to implement structural changes to encourage actual product sales and provide free training to new recruits. These measures are designed to curb the pressure on participants to prioritize recruitment over selling consumer goods.
The takeaway
Potential participants in multi-level marketing should be wary of earnings claims that do not reflect the performance of the vast majority of members. Transparency in business operations is a critical indicator of a sustainable and legitimate commercial enterprise.
Further reading
For more on how authorities monitor corporate misconduct, see our report on Financial Crime.
Live Poll
Do you trust that multi-level marketing programs offer a fair opportunity for people to earn money?
