Does This Describe Your MLM?

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Kevin Thompson hires himself out to multi-level marketing companies to give them legal counsel. Supposedly he knows his way around the legality of MLMs, just like my buddy Gerry Nehra supposedly does.

So I was perusing Kevin’s website and came across this interesting diatribe about what separates “legitimate” MLMs from illegal pyramid schemes. I’ve written a lot about Mary Kay Cosmetics, Usana, Herbalife, Prepaid Legal, and the like. And guess what? All of them seem to violate the most basic rule Kevin sets forth… to be legitimate you have to sell mostly to people not affiliate with the scheme, but these companies have distributors who purchase the bulk of the products! Continue reading