How Mormons, network marketing & social media combine to sell women a false dream

timeless vie

I’ve been trying to write this post for months now, but every time I’d get close I felt like the subject matter – women, mothers, feminism, multi-level marketing was so huge and amorphous that I’d give up, defeated, not knowing where to start.  So,  I was pathetically grateful when Kate Dyson of The Motherload agreed to join me in tackling this subject and wrote her post, “Is Network Marketing a Cult for Mums”.   You can read it here.  Between the two of us, we’ve tried to split the issue up into the most important parts that we think need to be highlighted.

I remember when my daughter was first born.  Up until then, she’d been an abstract idea in my mind, not quite real.  Then she was born, and I fell in love with her.   For the first years of her life I decided I wanted to be…

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How Mormons, network marketing & social media combine to sell women a false dream

The Legal Bit

 

This page is currently under construction but has been published early because it could be useful to people now, before it is complete.

I am not qualified to give legal advice and this page should not be taken as such.

I have gathered together some of the common laws that are relevant to trading schemes in the UK.

Timeline of UK Pyramid laws.

1973 Fair Trading Act 1973, section XI Pyramid selling and similar schemes is passed.

1973 Pyramid selling regulations were produced, based on the Fair Trading Act.

1989 Pyramid selling schemes regulations 1989 and amendments 1990 revoked the 1973 Pyramid selling scheme regulations 1973.

Trading schemes Act 1996 is passed which produces the Trading schemes regulations 1997. They revoked the regulations from 1989.

So now we have the Fair Trading Act 1973 (section XI), with some changes and the Trading scheme regulations 1997. Hopefully in the near future these regulation will be updated again to counter all the dodgy goings on that we see now.

 

 

What is a pyramid scheme?

In the UK, the term ‘Pyramid scheme’ is used interchangeably with ‘direct selling’ and ‘Multi Level Marketing’. MLMs tell you that pyramid schemes are illegal but their scheme is legal. This is not true. All these schemes are subject to the same rules and they are deemed to be legitimate if they adhere to the relevant laws. Here is an extract from the government research paper that describes the changes and development of the Trading Scheme Regulations Act. The paper describes how Amway tried to have the term ‘pyramid scheme’ designated to mean an illegal scheme. They were unsuccessful. We just have legitimate or non-legitimate pyramid schemes.

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Joining fees.

Regulation 10 The Trading Schemes regulations 1997 You cannot pay more than £200 in the first 7 days of joining a scheme.

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Cancelling a membership.

Also from the Trading Schemes Regs 1997.

Regulation 5 (e) you can cancel your membership within 14 days and get your money back.

You can return goods you purchased to a UK address and get a refund.

The scheme is not allowed to charge you for returning the products.

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Returning stockpiled goods.

Regulation 6. You can return goods you purchased upto 90 days before leaving. The scheme has to refund you but can deduct a handling charge. This is because often people in these schemes end up stockpiling products because of the pressure to purchase and the difficulty in selling.

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Members have to sell a product or service to others.

This is from The Trading Schemes Act 1996 section 1

A scheme is illegal if people are purchasing goods for themselves only or if there are no goods or services.2017-05-03 (26)

Translation in simpler language-

a) People in MLMs have to supply products or services.

b) These products or services

(i) are to be sold to customers by the people in MLMs or

(ii) Are to be used for helping the member make sales. For example-  samples                  for helping the member demonstrate products to customers.

Either way, products cannot be sold to members just for their personal use. There has to be involvement of customers.

 

Advertising MLM schemes

Any advert trying to encourage people to join an MLM must satisfy certain criteria under The Trading Schemes Regulations 1997, namely

The name and address of the company should be mentioned.

The goods or services should be mentioned.

The ‘statutory wealth warning’ (see next section) must be included and not be a smaller font than the rest of the advert, and must not be hidden away.

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Any written advert (e.g. Facebook post etc) that describes a brilliant opportunity that can earn you money, join me now, I need more people on my team etc should satisfy the above criteria. Many scheme participants choose to hide the name of their company or omit the warning. This is breaking the law.

 

Statutory Wealth Warning

This is schedule 1 mentioned above.

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Making promises to prospects

This is from  The Fair Trading Act 1973, from the wonderfully named section XI called ‘Pyramid selling and similar trading schemes’.

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(3) means that an MLM participant cannot persuade another member or potential member to make a payment, based on a promise that they will get payments for recruiting others.

(4) means that the person making these promises is breaking the law.

 

Penalties for breaking the above laws

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This is from the Fair Trade Act 1973, section XI (Pyramid selling and similar trading schemes). I think it is self explanatory. People involved in these schemes might be encouraged by their uplines or company to break these laws. There are penalties and you could end up in prison.

Fraud

The Fraud Act 2006 describes the different ways people can be guilty of fraud.

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Section 2 (fraud by false representation)  If a person lies, or implies an untruth, and they gain from this lie, and the lied-to person is exposed to a risk of loss, this is fraud.

Section 3 (fraud by failing to disclose information). If a person omits to tell something that they are legally bound to disclose, and this omission leads to someone being exposed to a risk of loss, or the liar gaining, this is fraud.

Section 4 (fraud by abuse of position). This happens when someone occupies a position where they should be safeguarding someone’s financial position. If they then lie or omit to tell the truth and that causes the liar to gain or the victim to be exposed to a loss, this is fraud.

I can think of lots and lots of examples where MLM companies and the recruiting members commit fraud. It is pretty widespread. These companies and the recruiting participants are taking quite a risk because the potential repercussions are a fine and/or up to  ten years in prison. TEN YEARS!!

The Fraud Act 2006 apples to companies, as well as individual people so that the people running the business could be found guilty and subject to a fine or prison sentence.

 

 

False advertising

Adverts in the UK are governed by the CAP code. The Advertising Standards Authority oversees this code. Here are some of the sections-

Section 8 Promotional marketing. This section reminds people to ensure their raffle/ lottery/ prize draw complies with the Gambling Act 2005 and data protection legislation. It covers offers that may be made, such as ‘buy one, get one free’, sales, competitions and prize draws.

Section 13 Weight control and slimming.  “A weight-reduction regime in which the intake of energy is lower than its output is the most common self-treatment for achieving weight reduction. Any claim made for the effectiveness or action of a weight-reduction method or product must be backed, if applicable, by rigorous trials on people; testimonials that are not supported by trials do not constitute substantiation”.

“Vitamins and minerals do not contribute to weight reduction but may be offered to slimmers as a safeguard against any shortfall in recommended intake when dieting”

“Health claims in marketing communications for food products that refer to a rate or amount of weight loss are not permitted”

“Claims that an individual has lost an exact amount of weight must be compatible with good medical and nutritional practice. Those claims must state the period involved and must not be based on unrepresentative experiences. For those who are normally overweight, a rate of weight loss greater than 2 lbs (just under 1 kg) a week is unlikely to be compatible with good medical and nutritional practice. For those who are obese, a rate of weight loss greater than 2 lbs a week in the early stages of dieting could be compatible with good medical and nutritional practice”

Section 12 Medicines, medical devices, health related products and beauty products. Adverts must not offer advice on the treatment or diagnosis of an illness or condition. They must not falsely claim that their products can cure anything. There are links in this section to other laws and resources to assist in working out if any rules have been broken.  The MHRA have a Blue Guide that has more details on medicine reporting.

 

More on health claims

According to Regulation 2 of the 2012 Human medicines regulations, and amended since then

A medicinal product is:

  • any substance or combination of substances presented as having properties of preventing or treating disease in human beings
  • any substance or combination of substances that may be used by or administered to human beings with a view to restoring, correcting or modifying a physiological function by exerting a pharmacological, immunological or metabolic action, or making a medical diagnosis

 

Medicinal products have to be carefully tested and registered with the MHRA for them to be considered medicines. To tell if a product has been through this process and is properly registered, it will appear on the MHRA’s medicines information database.   The European Medicines database covers the whole of the EU, including herbal remedies and veterinary products. Look up a product on these lists. If it isn’t there, no health claims can be made.

 

Libel and slander

When faced with criticism scheme participants will often cry slander or libel, often inaccurately. This is a brief description just to help clear up any misunderstandings if you are accused of either. The relevant law is the Defamation Act 2013.

Libel is defamation of a person that is written down. The complaining person does not need to prove they have been damaged by the comments made.

Slander is defamation of a person that is verbal. The complainer has to prove that they have been damaged by it.

For both types of defamation, the burden of proof rests on the defendant. For example, if I complain that you lied about me, and I have been harmed by that lie, you have to prove you are telling the truth. If you say it, you have to be willing to prove it.

If a comment is made and someone is upset about them but the comment is true, this is not libel or slander. This is why people say things like ‘I believe you are running a scam.’

To avoid being accused of libel or slander, do not tell lies on purpose. If you are saying something you think might offend or upset a powerful, rich and litigious company, be sure to make it clear your statements are based on facts or your beliefs.

 

 

To be added soon-

How to complain

The Legal Bit

Contents page

I have written a few posts and it is sometimes hard to find the one you want. Here is a list of some of the most popular/ useful ones and a quick summary. I hope you can find what you are looking for.

Follow Bot Watch on Twitter (@MLMBotWatch) or Facebook to keep upto date.

How to leave an MLM This helps people who are in an MLM and want to leave but are worried about how they should go about it. It can be a stressful time. This is also useful if you have already left and are grappling with the emotions that are left.

Network Marketing is a cult. This title is not as mad sounding as you think. It provides an analysis of what a cult is and how MLMs fit the criteria. This is quite a stressful read if you have been involved but things may make a bit more sense to you after reading.

MLM and the Enterprise Allowance This is a continuing investigation which is nearing completion. The article lays out the problem and the beginnings of my sleuthing. More progress has been made and it will be updated when completed. The Enterprise Allowance is a government scheme that funds new businesses.

You are not an independent Business Owner A quick look at what these words mean and how ridiculous they sound when applied to someone involved in MLMs. Quite funny, and a good one to link to in an argument with someone involved in MLM!

Directory of MLM information This one provides general MLM information and then gives an alphabetical list of some of the MLMs we have come across and details on them. I need to update it a bit to reflect some of the companies failing and creating new scandals, but it is a good place to start looking for information.

How to help someone in an MLM. This is a good read if you have a fried or relative involved in an MLM and you are at a loss as to what to do. You may be worried about damaging your relationship with them. This article will help you through the difficulties and offer practical advice.

In need of an alternative/ extra income? This is a resource for people who are in need of earning some money and need an alternative to MLM. This could be useful for someone who has been considering an MLM or people who are leaving and are still left with the problem of wanting to make money at home. I gain nothing from any of the links in this article. No affiliate marketing going on here.

The things MLMs say (or MLM Bingo) People arguing for MLMs will always come up with the same tiring arguments all the time. Here, they are laid out and explanations given as to why they are not true. If you get in an argument with someone in an MLM, refer them to this piece.

MLM Expectation vs Reality This was produced in partnership with someone who was quite high up in Forever Living. She spills the beans on what she was promised and what actually happened once she joined. The themes are relevant to all MLMs. It is quit an eye opener.

Forever Living using sick children, Great Ormond Street Hospital and a charity to make unsubstantiated health claims. This is an investigation that exposed some lies that some people were caught telling. The title tells you all you need to know.

People who care about you are worried A good one to link to if you have a friend or relative who has become embroiled in MLM but you don’t know how to approach them. People have actually sent this to people and had good results. It could also help you get your own thoughts together and working out why you are worried.

Are you or someone you know in an MLM? Having doubts? Aimed at people who have just joined an MLM and are thinking ‘what on earth have I got myself involved in here?’ Maybe it was going well at first but now the doubts are creeping in. Read this to find out what is happening to you.

Making False Health Claims. Part 1 and Making False Health Claims. Part 2 These explain the laws around making heath claims for products in the UK. This covers medicines, herbal remedies and any products that claim to alter the body’s functions. Seen an advert for a product that can cure diabetes or help you lose weight? These articles help you work out if those claims can be made, and if not, what you can do about it.

Contents page

Lean Java Bean coffee

Lean Java Bean coffee is starting to be promoted by poor, deluded bots who have found their last MLM did not work. They are hoping that this is the one that will make them millions. After all, it is clinically proven, everyone likes coffee and everyone needs to lose weight without putting in any effort right? Surely they can’t lose? After all, their last coffee MLM had problems because the meanies wouldn’t let them promise weight loss miracles. This one will apparently. They sell weight loss coffee and expensive ‘tools’ aimed at self improvement (read ‘brainwashing products’)

Let’s look at the claims made and the evidence behind them. Then we’ll look at the law and see if they should be making these claims.

Here are some of the claims being made out there…

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Wow! That’s quite some coffee! The list of claims is significant and promises quite a lot. The addition of ‘clinically proven results’ sounds quite impressive and has obviously convinced the people trying to sell it.

So what are the ingredients? They seem to be-

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I went to the website of the actual company , through clicking on a rep’s link, and found some details about the amazing ingredients. There are 3.

Ingredient 1.

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20 people is a very, very small sample of people to base any conclusions on. Even if it is without ‘side affects’. The dose quoted is 500mg, how much is in the coffee? We don’t know because that isn’t disclosed on the label. It could be 1mg for all we know. Let’s see if we can find the research that was done to come up with these claims.

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The above article summary is from the Super Citrimax part of the Lonza website.  Lonza manufacture Citrimax.  If you understand research (as I do), you will notice that there are only 24 participants which is pathetically low. More tellingly, the results are not as good as they are making out. It says at the end that ‘body weight tended to decrease (P=0.1)’. For a result to be statistically significant, ie the results are what they say they are, the P value needs to be less than 0.05. This means the research does not show Citrimax does anything except reduce how much energy the people consumed. It has no effect on feelings of fullness or weight loss.

Three other research papers are cited on the super Citrimax website, but none of them describe anything resembling the research cited by Java Bean. Another study stated results but they were not all statistically significant. Even more tellingly, it was described as a pilot study. This is a type of study that is done as a practice run to see if it is worth running a bigger study. There is no mention of a bigger study. Either they didn’t do one or no significant results were found.

Ingredient 2.

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Lonza describe the two studies that were done on Chromemate. The first one had 4 groups of 10. Just ten! LDL cholesterol, and therefore total cholesterol, were reduced in the small group that took Chromemate. Three other cholesterol related numbers were not affected. Again, this was a pilot study with no follow up. The other ‘study’ wasn’t a study at all, rather, it was someone theorising how Chromemate might be useful for atheletes.

Ingredient 3.

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I found the website that is linked to this ingredient. It is pretty disturbing. It has to be visited really to truly take in the horrors of this product. Cocaine leaves without the cocaine? What?

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The ingredients are listed here. The reasoning for including these ingredients are mostly traditional use claims, such as

Annatto Leaf Powder

Annatto Leaf Powder – the rainforest tribes have used the entire plant as medicine for centuries. The Piura tribe as an aphrodisiac and astringent, and to treat skin problems, fevers, dysentery, and hepatitis uses a tea made with the young shoots. The leaves are used to treat skin problems, liver disease, and hepatitis. The plant has also been considered good for the digestive system. The Cojedes tribe uses an infusion of the flowers to stimulate the bowels and aid in elimination as well as to avoid phlegm in newborn babies. Traditional healers in Colombia have also used annatto as an antivenin for snakebites. The seeds are believed to be an expectorant, while the roots are thought to be a digestive aid and cough suppressant”.

 

So, are the claims made for the coffee based on trustworthy facts?

There has been no research done to test the Lean Bean Java coffee.

The claims come from research and traditional claims made for individual ingredients.

The research is flimsy at best.

We don’t know how much of the ingredients are in the coffee itself.

 

I conclude that there is not enough evidence for the claims that are being made for the coffee.

 

Legally allowed claims

But surely, for the company (and the people selling and buying it from them) to make these claims, they must have pretty solid grounds? They are making claims that their product can interact with the body and change how it works, bringing about changes. This means it is a medicine in UK law and a drug in US law. The MHRA regulates medicines in the UK and they say this-

“A medicinal product is:

  • any substance or combination of substances presented as having properties of preventing or treating disease in human beings
  • any substance or combination of substances that may be used by or administered to human beings with a view to restoring, correcting or modifying a physiological function by exerting a pharmacological, immunological or metabolic action, or making a medical diagnosis”

If  product is to be sold as a medicine, it needs to have a licence from the MHRA. Is Lean Bean Java coffee or any of the three ingredients listed as a medicine?

I searched the MHRA’s list of licenced medicines.  The following ingredients were not on the list- Lean Bean Java, Macoca, Chromemate and Citrimax (with and without the ‘super’). This means they are not an authorised medicine so no medical claims can be made about it or the ingredients.

I decided to search the European Medicines Agency (EMA). They keep a register of medicines and herbal remedies for the whole of Europe. I searched for the same ingredients. Guess what? There is no record of any of the ingredients there either.

I then looked up some of the other ingredients on the EMA. Ginseng root can be claimed to be able to treat tiredness and weakness, but not if it is in combination with other herbal medicines.  There is no good science for it, and a few side effects, but this ingredient can only be claimed as a herbal remedy if it has been authorised by the MHRA in the UK. Looking this up, the only Ginseng products that are allowed to make these claims are from two companies that make it in tablet form.

Green tea extract was searched for next. The EMA are still evaluating the evidence. The MHRA have not licenced any green tea products based on their herbal use.

I then looked up all the other ingredients on the EMA and MHRA websites and found no mention of any of them. I won’t bore you with the links to each search. You can have a look yourself if you like.

Legally then, no one can claim that Lean Java Bean or any of its ingredients can affect metabolism or have any noticeable effects on the body. Looking back at the images in the beginning of this post, there are many claims being made about the physical effects of this product on the body. These are very, very wrong, as well as misleading.

 

What can be done?

Companies should not be allowed to get away with making misleading and illegal claims about their products. There are safeguards in place to prevent these lies from being made and products sold under false pretences. The legal body in the UK that monitors these adverts is called the Advertising Standards Authority. They refer to a set of rules called CAP that set out what can and can’t be said. Their website says they were set up keep adverts ‘legal, decent, honest and truthful’.

If you see any adverts about Lean Java Bean coffee claiming they cause any physical effect on the body’s functions, you can complain to the ASA. It is a really simple process and you can do it anonymously if you like. Normally, if you complain about an MLM, it is the rep who was selling it that got in trouble and they took the blame. The company reprimanded them or fired them (so much for being an independent business owner). In this instance, however, the claims seem to be coming direct from the company (Vitae Global).

Background to the company.

I tried to look up this company at Companies House but there seems to be no trace of them. I wanted to see their history and the owners’ details for some clues as to what they might be upto. A little look around shows a facebook page that has been deleted, and a  Behind MLM review that has been deleted. I found this review, but be warned, it tries to sell you his method of recruiting but it has a lot of information.

Here is a video message for the founders who are joining before the company launches. Jim Britt literally promises you will be rich very quickly and very easily. I investigated the company further but I began to be drawn down a rabbit hole so I extricated myself and decided not to bother.

For now, I would just like to concentrate on the fact that the health claims are bogus, illegal and come straight from the company.

 

What you can do

Please complain to the ASA if you see any of these illegal health claims for this coffee. It needs to be stopped. The complaint form is straightforward to fill in. You will need to take a screengrab and note the time and place that you saw the advert.

The basis for the complaint will be that the health claims are not allowed as the product is not a medicine or herbal remedy as regulated by the MHRA. Let us know how you get on…

 

 

 

Lean Java Bean coffee