Multi-Level Discernment

by Kati and Monica

We helped shine a spotlight on MLMs last week, and what it showed wasn’t pretty. On Thursday and Friday, Vaca Daffan Law hosted the 6th annual conference regarding “Multi-Level Marketing: The Consumer Protection Challenge,” which is organized by an inspiring group of consumer advocates. We were proud to have our firm listed as one of five event sponsors for 2026 and also take part in the conversation. Our high-level overview here will also point you to some of the many resources discussed. 

1. Sunlight disinfects.

Thoughtful research and analysis help shine a light on an industry that has long operated in obscurity. Conference attendees learned about new research from Stacie Bosley and co-authors, which shows that in contrast to the industry’s own recommendations, most MLM firms either rely on vague, non-prominent disclaimers or have none whatsoever. The research showed that specific and prominent disclosures have a powerful effect on how people evaluate an MLM opportunity. Kenan Kalayci explained that when it comes to pyramid schemes, it helps to have disclosures that “do the math” to illustrate the true risk of investing. And Monica and co-discussant Doug Brooks explored how dense contractual provisions, written by and for MLMs, work to keep MLM participants off balance, keep people from leaving the MLM, and keep people from suing after a bad experience. 

Meanwhile, a recent publication by Bill Keep and Claudia Groß dives deep into the impact of corporate money on academic marketing research regarding MLM. (For example, they found that academics with industry ties contributed to 59% of the articles analyzed and accounted for 67% of citations in Google Scholar!) Nonetheless, recent sunshine must be having an effect – Bill Keep and Máire O Sullivan presented the “State of the Industry,” which showed that MLMs are not thriving. Keep that research coming – Lucas Dixon mentioned a forthcoming book about critical perspectives on MLM and presented some recommendations on what’s still needed. If you’re a researcher and would like to get involved, we’d love to talk with you!

2. Law enforcement plays a critical role.

Conference attendees heard that law enforcement continues apace. Dariusz Łomowski described Poland’s prosecution of IM Academy/Iyovia and iGenius, two MLMs that were recurring topics at the conference. iGenius was also the subject of an interesting paper by Jacob Ørmen called “Perpetual Precarity.” A rousing presentation by Bonnie Patten from Truth In Advertising covered IM Academy and its wild claims; Bonnie reviewed the FTC’s cases against it and Forever Living and shared her insights about how, in spite of industry hopes, principled law enforcement against MLMs is decidedly ongoing. Lois Greisman from the FTC confirmed this fact and elaborated on additional actions against high-level MLM participants Stormy Wellington and Steve/Gina Merritt for deceptive earnings claims. (Somehow, she didn’t tip her hand about the $90M settlement just announced this week!) Yet, Gladys of MLM Exit had strong words regarding law enforcement, and a message for the FTC in particular that it should be doing more.

3. More people are taking action and fighting back.

MLMs can be held accountable for consumer harm outside the law enforcement context, and conference attendees heard about a variety of efforts to make it so. The keynote speaker on Friday morning was the indomitable Delaware Representative Melanie Ross Levin, who is pushing for legislation in her state to boost transparency in MLM marketing. Industry members aren’t happy about it, and Kati greatly enjoyed discussing that reaction — as well as strategies to support the bill — with John Breyault, Doug Brooks, and John Whitelaw. Kristen Simplicio and Glenn Danas of Clarkson Law talked about their valiant efforts to seek accountability for MLMs accused of misclassifying workers as independent contractors — a fight that’s currently raging in the courts.  And, it’s not just lawyers. Last week we also heard an epic saga from Tracy Coenen, a forensic accountant who has run the website Pink Truth for decades – at great personal cost – to provide a platform to expose the gaslighting many MLM participants experience. Her dedication to the truth is nothing short of heroic.

4. We need storytelling, but not fairy tales. 

Every year, the conference features moving personal accounts from people who’ve been harmed by MLMs. For example, attendees heard impactful personal accounts from Brandie Hadfield and Megan Williams of Flipping the Pyramid, as well as Meggan Lanahan, about how they were targeted for recruitment at vulnerable moments in their lives, their journeys to recover from their MLM experiences, and their inspiring work to help other people. For those who wonder why it takes time to understand the harm people experience, new work by Sydney Graham exposed how MLM participants manage MLM stigma by using social comparison strategies and infusing their values into explanations about their MLM work. Steven Hassan joined to talk about overlapping cult dynamics, and Brittany Morgon talked about fear mongering and the health pseudoscience often used to peddle MLMs. 

We also heard an update from professional storyteller Bridget Read, the author of a fabulous book everyone should read, Little Bosses Everywhere. One thing Bridget reflected on was the announcement from the MLM industry group Direct Selling Association (DSA) on the first day of the conference, which called on MLM participants “to submit their stories to DSA and explain why they choose independence over traditional employment.” Speaking for ourselves, we understand why DSA places heavy reliance on individual story-telling in its current advocacy. With Bridget’s book, the larger historical and social context of MLM is publicly illuminated as never before. And the growing body of research, analysis, and data readily available online does not look good for the industry. With the big picture evidence all trending against MLM, its proponents hope that cherry-picked individual stories will help with damage control.

In sum, we loved the conference.

Given a complex space like MLM, a multidisciplinary and always-evolving approach is the only way to address consumer harm. We learned a LOT last week and came away energized by our colleagues’ commitment and great ideas. We look forward to next year!

This content is for informational purposes only and is not legal advice.