From Seattletimes · · 1m 10s
WA and FTC Settle $225M with Amway
Washington and the FTC settle $225 million with Amway over unfair sales practices.
In brief
Washington and the FTC settle $225 million with Amway over unfair sales practices. Washington and the FTC reached a $225 million settlement with Amway for misleading sellers about earnings and product sales. Originally reported by Seattletimes.
Settlement Announcement
Washington and the Federal Trade Commission reached a $225 million settlement with Amway for unfair and deceptive business practices.
Amway Business Model
Amway sells health, beauty, and home care products through independent sellers rather than stores, using a multilevel marketing approach.
Unfair Practices Alleged
The FTC and Washington state claimed Amway pressured sellers to buy unwanted products and misrepresented earnings through false claims.
Product Pricing Concerns
Amway sold a case of 24 water bottles for $52, making products expensive and hard to sell to the general public.
State Involvement
Washington state joined the lawsuit because many impacted sellers live in Spokane and the Seattle area.
New Rules for Sellers
Sellers must sell 70% of products monthly to avoid inflating sales, and receive reduced compensation if recruits don't resell products.
Amway's Response
Amway says the settlement reaffirms its business model and focuses on customers and employees after compromise.
The key point
Washington and the FTC reached a $225 million settlement with Amway for misleading sellers about earnings and product sales.
