MLM companies often claim to offer people the chance to earn money, work on their schedule, and find unlimited potential. But hidden behind these appealing promises are many instances of people being taken advantage of, misled, and encountered unethical behaviours. In India, where MLM schemes have become more common recently, it’s important to recognise the most dishonest companies operating in this industry.
Here is the list of the five scummiest MLM companies, their deceitful practices, the harm they cause, and why you should avoid them.
Also read: 5 scummiest MLM companies in USAÂ
Modicare
- Founded: 1996
- What they sell: Health, wellness, and household products
- Owner: Samir Modi
- Impact: Modicare has faced allegations of operating as a pyramid scheme, luring individuals with promises of wealth and success. Many participants have reported financial losses and disappointment after investing their time and money into the company.
- Why avoid it? Modicare’s business model heavily emphasises recruitment. Members are incentivised to build a large downline rather than focus on legitimate product sales. This approach often leads to financial ruin for most participants, as only those at the top of the pyramid benefit.
QNet
- Founded: 1998
- What they sell: Lifestyle and wellness products, educational courses
- Owner: Vijay Eswaran
- Impact: QNet has faced widespread allegations of fraud and deceptive practices. It targets individuals with promises of quick riches through selling its products and recruiting others into the scheme. Numerous complaints have been filed against QNet, with victims alleging losses running into thousands of crores.
- Why avoid it? QNet operates through a binary compensation structure,. Members are incentivised to recruit new members to earn commissions rather than through legitimate product sales. This model primarily benefits those at the top of the pyramid, while most participants suffer financial losses.
Also read: Is CDkeys legit?
Amway
- Founded: 1995
- What they sell: Health, beauty, and home care products
- Owner: Rich DeVos and Jay Van Andel
- Impact: While Amway is a global MLM giant, its operations in India have been criticised for its pyramid-like business model. Despite its claims of being a legitimate direct-selling company, Amway has been accused of misleading individuals with unrealistic income promises and pressuring them into purchasing overpriced products.
- Why avoid it? Amway’s focus on recruitment over product sales and its complex compensation plan makes it difficult for the average participant to turn a profit. The company’s emphasis on building a downline perpetuates a recruitment cycle in which members’ financial success depends on continuously bringing in new recruits.
Herbalife
- Founded: 1980
- What they sell: Nutritional supplements, weight management products
- Owner: Mark R. Hughes
- Impact: Herbalife has faced intense scrutiny globally for its alleged pyramid scheme practices. In India, the company has come under fire for misleading claims about its products’ health benefits and exploiting vulnerable individuals with promises of financial independence.
- Why avoid it? Herbalife’s compensation structure heavily incentivises recruitment, emphasising building a large downline. This focus on recruitment rather than retail sales has led to accusations that Herbalife operates as a pyramid scheme, where only those at the top profit at the expense of most participants.
Vestige Marketing Pvt. Ltd.
- Founded: 2004
- What they sell: Health and wellness products
- Owner: Gautam Bali
- Impact: While Vestige presents itself as a legitimate direct-selling company, it has been criticised for its MLM practices. The company has been accused of luring individuals with promises of financial success and misleading them into purchasing overpriced products.
- Why avoid it? Vestige’s compensation plan heavily relies on recruitment, with bonuses and incentives tied to building a large network of downline members. This focus on recruitment rather than genuine product sales can result in financial losses for most participants.
