| | Amway pushed and pushed hard, we were forced into bankruptcy. At a point when we were losing everything, our sponsor attempted to get us to sign an agreement to never speak of my experience in exchange for the release of nearly $20,000 in income that Amway had held “in escrow.” At the same time, Amway strongly encouraged me to “sell my business” for almost $75,000. It appears what they both wanted was not my business but my silence. Neither our silence nor or character were for sale and we left our home, the only one our children had ever known.
I spent thousands of hours in research, documenting the fraud and unfortunately, it goes all the way to founder Rich DeVos and some of his family, whom I had held in such high regard. To my shock, I learned that Amway senior management and ownership had been fully aware of the fraud and exactly what was going to be done to my family as early as the 1980’s. An internal document, from then Business Conducts Manager Ed Postma to now Amway Indonesia President Patric Sullivan reveals that Amway investigated the tools system and determined it to be “illegal” and found that there was concern over “mind control” from tactics utilized upon distributors. The internal document, on Amway stationary, dated January 19, 1983, can be viewed here:
| | Click On PDF Icon To Download The Postma Memo...The Smoking Gun!! | Rich DeVos, in about 1982, described the tool business as “an illegal business”...here it is in his own voice:
| | Click On MP3 Icon To Hear Rich DeVos Admit He Knows About The Fraud!! | The external and internal documentation begin to pile up. I culled over 1,000 hours of legally recorded tapes, near 100 hours of video and banker boxes of related documentation that inconvertibly define twenty years of what appears to be the largest consumer fraud in history. Professor G. Robert Blakey was as an expert witness in a case as he is the nation’s foremost expert in organized crime. Professor Blakey’s extensive legislative drafting experience resulted in the passage of the Crime Control Act of 1973, the Omnibus Crime Control Act of 1970 and the Organized Crime Control Act of 1970, Title IX of which is known as "RICO".
Professor Blakey literally wrote the RICO laws that broke up the Mafia in the United States in the early 1970’s. He did an extensive analysis of Amway and drew this independent conclusion:
"It is my opinion that the Amway business is run in a manner that is parallel to that of major organized crime groups, in particular the Mafia. The structure and function of major organized crime groups, generally consisting of associated enterprises engaging in patterns of legal and illegal activity, was the prototype forming the basis for federal and state racketeering legislation that I have been involved in drafting. The same structure and function, with associated enterprises engaging in patterns of legal and illegal activity, is found in the Amway business."
His entire report is incredibly detailed and can be viewed here:
| | Click On PDF Icon To Download The Blakey Report...Amway Is Compared To Mafia!! | The paper work from the countless lawsuits filed against Amway, Rich DeVos and Kingpin level distributors would most likely fill several office buildings. Despite having full knowledge of the ongoing fraud, Rich DeVos wrote the book Compassionate Capitalism: People Helping People Help Themselves. The sick irony is that this is neither compassionate nor capitalism. It is a fraud. DeVos promotes the rags to riches stories of the very Kingpin distributors he knows are defrauding the public (and have been named with him as co-defendants in multiple fraud lawsuits.)
My first hand experience was in building the Amway business globally. Our organization was used to recruit over 1,000 people into Amway. Of those induced to participate, approximately 99% did so at a financial net loss in the Harteis/Yager Amway business. There were bankruptcies, lost homes and some distributors were left tens of thousands of dollars in the hole. See Case Study Fred Harteis section for specific testimonials. What was most disheartening to learn was that Amway knew in the early 1980s that almost 100% of those recruited into the Amway business would LOSE money.
I learned of a man named Bruce Craig. He served as the Assistant Attorney General of the state of Wisconsin for 30 years until his retirement in 1997, at which point he went into private practice. While acting as the Assistant Attorney General, he prosecuted pyramid cases, including what he describes as “extensive litigation” against Amway in the early 1980’s for income misrepresentations. In the discovery process of this litigation, distributors tax returns revealed that the top 1% of Amway distributors in his state (Direct distributors) had net annual incomes of “minus $900.” The system and its related costs have grown dramatically since then. The income figures could actually be worse now.
Here Rich DeVos, in his own words, talking about an out and out “illegal pyramid” and several other specific examples of financial abuses…
| | Click On MP3 Icon To Hear Rich DeVos Talk About Illegal Pyramid Activities!! | Second generation DeVos’s now run Amway in a manner near identical to their father. Despite knowing that the distributor force is being recruited through deception and then often bilked out of their life savings, Dick DeVos made this taped representation to a large crowd of trusting distributors.
“That’s what we want to talk about tonight. Because I am pleased to be able to tell you that, once again, for the thirty-eighth straight year, the Amway business opportunity is the best business opportunity in the whole world, bar none. I don’t say that with arrogance, I say that simply because it is true. And we work each and every day in Ada to keep it true.”
- Dick DeVos, Alticor President
As I began to interact with experts in the area of consumer fraud, several critical issues were made clear to me. First, the Federal Trade Commission requires that the majority of products going through a multi-level marketing company be sold to an end consumer (a non distributor) to not be considered an illegal pyramid. This is referred to as the retail sales rule. This was yet another surprise as the business we were taught to build consisted almost entirely of self consumption. This type of operation of business, per the Federal Trade Commission, is an illegal pyramid.
It goes further than that. The tools business of books, tapes, CD’s and videos is also an illegal pyramid per the FTC as it is a closed system and no product is ever sold at retail to an end user/consumer outside of the group. Consumers have been unknowingly recruited to become involved in not one but two illegal pyramids as they enter Amway. Almost 100% of those induced to participate have lost money as the FTC regulations set up to protect from the abuses of illegal pyramiding have been wholly ignored by Amway.
An April 26, 1998 report in the Baton Rouge Advocate revealed that:
“The FTC decision noted, for example, that one of Amway's rules "provides that distributors may not receive a performance bonus unless they prove a sale to each of 10 different retail customers during each month. But Amway Corp. executives and several distributors who were interviewed admit that rule is neither monitored nor enforced.”
“Larry Harper, a senior manager of Amway Corp.'s distributor relations section, also acknowledged bonus checks get paid to distributors who have no retail sales. When asked if a distributor can get a bonus check without having any retail sales, Harper responded: "Yes you can."”
Documentation reveals that Amway senior management and ownership has known of this violation of FTC guidelines for two decades. In addition, they have known about the fraud of the tools business for just as long and have had their attorneys work to actively conceal it from the unknowing distributors. Andy Andrews, a Diamond who spoke out against the abuses of the tools business was directed by an Amway attorney to assure the majority of distributors never learn about the secretive tool income. He advised that the Amway attorney, discussing the secretive tools income, told him: “ 98% of the IBO’s were not to participate in the income nor were they even to know there was even an opportunity.”
Here it is in his own voice:
| | Click On MP3 Icon To Hear Amway Diamond Andy Andrews Share Shocking Evidence From Amway's Attorneys About Secret Tool Income! | I completed my research and Merchants of Deception, the highly detailed account of the twenty year document trail of fraud and our terrifying exodus from it. This book is what launched the current FBI investigation involving the bureau and US Assistant attorney Wayne Samuelson. In one of a large number of meetings with the FBI, cancelled checks made out to my sponsor, Harteis and Yager and/or their business entities are collected. I am also asked to fly to another state to provide Merchants of Deception to an agent of the Criminal Investigation division of the IRS. Merchants of Deception is also what launched the NBC year long investigation and undercover expose where they filmed the fraud first hand. Their crack undercover team was exposed to the exact deceptions exposed in the book. The book is currently being utilized as a resource by governments and/or counter cult organizations in multiple foreign countries.
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