Chris Kavas

I know many good, well meaning people that talk about the money they or their upline makes as a decision point for joining their business.

Many don’t know that they are, in fact, committing a crime.

I know that sounds harsh, but the truth is the FTC considers making income claims as a means of recruitment illegal.

Many new to network marketing don’t know this nor are they advised by their company or upline to avoid income claims.

The FTC has a long history of disliking earnings claims in both Business Opportunities and MLM. Here is just a brief summary of the some of the history that allows them to hit your company for earnings claims. For those of you that don’t know prior rulings in court cases have the Effect of Law! This is called “precedent law”

According to Rod Cook, the only way you can legally publish your earnings is if you also fully disclose the incomes of every single person participating in the business opportunity.

Len Clements of Marketwaveinc.com puts it plainly:

Displaying commission checks is considered one of the most taboo acts a distributor could do. No competent attorney, or corporate compliance department, would ever approve this. There is no specific law against it, but based on years of legal precedent we know that state AGs and the FTC consider this to be a “deceptive trade practice” (even when you can prove the checks are real and accurate). Not only that, but the FTC recently changed the law regarding testimonials and what are “typical results”. You can no longer get away with just the disclaimer “results not typical”. Now when you show examples of how well something works, even a business opportunity, you also have to disclose what ARE typical results.

So no, in my laymen’s opinion, this is not legal.

If you take some time to think about this, the FTC has actually done you a favor.

First, using an income claim sets false expectations and is one of the reasons why so many come into this business treating it more like the lottery than what it actually is – a legitimate business that takes time and effort to build. Besides, their earning potential is dependent on their effort and has little to do with how much money is made by you or your upline.

Second, this is the perfect response when a prospect asks you how much money you make in your business. Simply tell them that the FTC forbids you from disclosing your income. It is the truth. You avoid setting false expectations and at the same time demonstrate a high level of integrity. As their sponsor it is your job to help them avoid the landmines that may hurt them and their business.