As a global organization maintaining its brand value in the market, the Amway corporation has been performing sub-standardly right from its early days.
Getting over lawsuits, paying heavy penalties, and inviting public slanders is the long and short of Amway’s journey to date. The company’s pyramid scheme of selling has been neglected time and again as well.
That being said, these are the causes of the many problems and scandals that have resulted in Amway’s outright ban in some nations.
Amway Banned Countries List
Amway is completely banned in China, Bahrain, and Vietnam. Despite the widespread prohibition of pyramid schemes in countries like the United States, the United Kingdom, India, etc., Amway has still thrived there in one form or another.
|Country Name||Extent Of Ban|
|China||MLM is completely Illegal|
|Vietnam||MLM is completely outlawed|
|Bahrain||MLM is completely Illegal|
|United States||Partially banned|
|United Kingdom||Partially banned|
|Canada||Paid a heavy fine of $45 million but wasn’t banned|
|Australia||Faced backlash and legal issue but didn’t get banned|
As of now, Amway operates in 100+ countries across the globe and makes a profit of more than $1 billion considering its global business. Despite the restrictions imposed by the national authorities on unlawful selling tactics and unfit product standards, Amway has been flourishing in those countries for more than 3 decades now.
The false marketing schemes of the company are so attractive that it has been able to maintain a network of more than 10,00,000 members across the world.
Which Amway Products Are Banned?
Amway offers a vast variety of products, from their cleaning line to their makeup line to their daily supplements and even their Amway home goods!
Keeping aside the anti-business practices of the company, the products manufactured by it are also rejected and unfit for common use.
In Feb 2015, the company was ordered by the FSSAI and FDA, the state agencies of India, to withdraw 6 products from the market. This was due to the issues with the ingredients of the products.
All these products belonged to the popular sub-brand of this MLM company, namely, Nutrilite, Nutrilite Kids Drink (mixed fruit flavor), Nutrilite cal-mag-D, Nutrilite natural B tablets, Nutrilite Bio C, Positrim Vanilla and Nutrilite Iron Folic tablets were the names of the defective products.
The following products were banned on the grounds of regulation breach due to the more than allowed quantity of minerals present in them. In addition to these, there have been several cases reported by people against the adverse side effects of Amway’s other products like soap, shampoo, lipstick, etc.
It is completely obvious to understand that a brand whose focus has been on minting money through MLM business would be hardly interested in providing good quality products to its consumers. Unfortunately, the common people get ensnared by the marketing gimmicks of the brand’s agents and purchase such ineffective and overpriced products.
Why Has Amway Gotten Bad Reputation Over The Years?
The amount of defamation the term network marketing receives from the people is sufficient to damage Amway’s reputation as a decent organization.
Moreover, the continuous involvement in murky matters with the enforcement agencies of several countries has made the company suffer heavily in terms of money and popularity.
Multi Level marketing, network marketing, and illegal pyramid scheme are known devious techniques for selling products. Commissions earned on sales are the major contributors to a person’s income in the network marketing industry.
Amway is one such Multi Level Marketing company and is the promoter-cum-creator of such business models due to which it has become unfavorable among the masses. According to Cue Crowd, state that Amway’s style of generating sales is based on deceit and false attractions.
The company claims to have about 15,000 employees and 10,00,000 independent business owners (known as Amway IBO) in its network but the sad reality behind this is the unethical procedure by which the company has grown itself — luring people through illustrations of luxurious lifestyles and promises of elite status in society is the primary strategy used by the company to connect with more and more people!
However, these people with high ambitions, later realize the harsh reality and end up quitting the company.
When they get to know that in the course of becoming ultra-rich they have to purchase and sell beauty and healthcare products, all their high hopes get shattered. Knowing that nothing can be done to substitute this, they end up leaving the company having wasted a huge time and money.
Collectively, these are the factors directly responsible for Amway’s depleting reputation among the people.
Is Amway a Pyramid Scheme?
The pyramid scheme is banned in 20+ regions including the larger nations like the USA, UK, Brazil, China, India, Japan, etc. No wonder the scheme is so deceitful and useless that the respective governments had to ban it.
In April 2022, Amway’s assets worth Rs. 757 Crores were seized by the ED in India owing to business malpractices like the MLM scheme, pyramid scheme, money circulation schemes, and money laundering.
Amway has always been involved in troublesome activities. Instances in the past are a testimony to Amway’s unethical mode of business.
- In 2013, William Pinckney, the CEO of Amway India was arrested along with 2 others on charges of fraud.
- In 2007, a class-action suit was filed against Amway USA for running the banned pyramid scheme. The company later paid $56 million in 2010 as compensation.
- In 1998, the Chinese government banned all forms of direct sales which hugely impacted the business of Amway China. Later in 2005, this ban was lifted with some strong new rules, causing the company some relief.
These repetitive events of fraud and trickery have crushed the credibility of the company even among its normal customers. Despite their good quality, people no longer like to buy Amway products.
The preventive measures adopted by the governments over the years have added fuel to the fire. However, the company claims to have generated $8.9 billion in 2021. This indicates the strength and vastness of Amway’s global network.
Undoubtedly, in this age of smartphones, people have become smarter too and they understand the fakeness of these network marketing brands.
However, there are still many youngsters who fall prey to Amway’s bogus schemes of earning easy money. This number shall decrease to 0 in the coming years, given the rising loss of trust and unwillingness to buy from a disputed brand that is a declared serial fraudster!
Can Amway Be Trusted?
Instances like these have been flooding the internet for a long time now. There have been multiple victims of the notorious pyramid scheme and those individuals have rightfully renamed the company as ‘Scamway’.
The pyramid scheme is the art of fooling innocent individuals in the name of earning through network building. The aim of the recruiters inviting freshers to join Amway is to expand their network so that they can earn higher profits.
The whole model relies on the sales made by the down-line (people invited by him/her) of an individual. The higher the sales made by the subordinates, the higher will be the commission of their up-line (the inviter).
In this Ponzi scheme, the one who recruits the earliest is the one who earns the maximum money. All of this money is commission based i.e. the bigger the network the higher the commission earned.
Hence, the up-line always nags the members of the down-line to work hard and make sales so that he/she can benefit the most.
Sadly, the down-line members who are mostly innocent and inexperienced individuals, work tirelessly to sell the products purchased by themselves to others. They are also supposed to add every client of theirs to the company’s network i.e. in their downline.
Rich DeVos and Jay Van Andel, the founders of Amway Global, had a vision of “Providing people a new life of excitement, promise, profit, and hope.” However, the brand’s story has always been contradicting its vision.
Amway products are the no.1 direct selling entity/direct selling company in the world but considering the impression it has made on the people, its end days are not far ahead.