Amway agrees to pay $225 million over deceptive recruiting claims, the FTC says

Amway Corp. has agreed to pay $225 million to settle federal and Washington state claims that it deceived people into joining its sales network with inflated earnings promises. The Federal Trade Commission says the deal, filed Sept. 17, 2026, in federal court, is the largest settlement it has ever obtained against a multilevel marketing company. Two Amway-affiliated recruiting groups, World Wide Group and Leadership Team Development, are named alongside Amway in the same proposed order.

Recruiting pitches that promised $40,000 a year

Amway is headquartered in Ada, Michigan, about 10 miles from Grand Rapids, and has built its business for decades on in-home sales through IBOs rather than retail stores.

Regulators say Amway and its affiliates told prospective recruits, known inside the company as Independent Business Owners, that they could earn $40,000 or more a year selling Amway products such as Nutrilite supplements and home goods. Most people who signed on after 2020 did not come close, according to the complaint: they spent more on training materials, sales events and starter product than they ever earned back. The FTC and Washington also allege some recruiters pressured IBOs to buy inventory they were unlikely to resell and to report sales that never happened.

“Amway and its affiliates misled prospective workers with false earnings claims and then pressured them to buy Amway products they were unlikely to be able to sell,” the FTC’s Bureau of Consumer Protection said, adding that the agency will not tolerate companies deceiving workers with fraudulent sales reporting.

Washington joins the FTC’s case against Amway

Washington state’s attorney general filed the action jointly with the FTC in the U.S. District Court for the Western District of Washington, naming Spokane Valley-based World Wide Group and North Carolina-based Leadership Team Development as co-defendants alongside Amway. Both groups recruited and trained IBOs on Amway’s behalf, according to the state’s release.

Attorney General Nick Brown said Amway and its affiliates “profited by taking advantage of regular people’s hopes and ambitions.” He added that the settlement “will deliver relief for the many Washingtonians who joined Amway seeking to provide for themselves and their families, only to lose time and money and wind up with cabinets full of products they don’t want or need.”

A stipulated order, not a final judgment yet

The $225 million is not yet locked in. Court records show the government and Amway filed a “Stipulated Order for Permanent Injunction, Monetary Judgment, and Other Relief” on Sept. 17, 2026, and the FTC’s own case docket still lists the matter as pending rather than closed. That means Amway has agreed to the terms and a federal judge must still sign off before the payment obligation and injunction take legal effect.

Beyond the money, Amway agreed to change how it pays IBOs going forward, disincentivizing members who try to profit mainly by recruiting others and buying products themselves rather than by actually selling those products to customers. The $225 million is expected to largely go toward repaying Amway members affected by that conduct once the order is entered and a distribution plan is set.

Amway disputed the FTC’s account even while agreeing to settle. The company said the deal, like any settlement, required compromise, and that resolving the case allowed a focus on customers, IBOs and employees going forward; Amway also said it disagreed with regulators’ description of its business model and rejected the claim that its sales data was inaccurate, according to Michigan Public Radio’s report on the settlement.

No claims process or payout timeline has been announced yet, and the FTC has not said how affected IBOs would eventually be identified or compensated once the order is entered. The agency’s history with large MLM cases suggests any distribution would come only after the court approves the order and the FTC sets up a redress fund.

How $225 million tops Herbalife’s MLM record

At $225 million, the proposed Amway order would surpass the FTC’s previous largest MLM settlement: a $200 million deal with Herbalife announced in July 2016. That earlier case, described in reporting on the Amway settlement as the benchmark this one beats, ended with the FTC mailing checks to nearly 350,000 Herbalife recruits, with individual payments ranging from about $100 to more than $9,000.

Whether Amway’s settlement ultimately reaches as many people as Herbalife’s did is still an open question. The FTC has not disclosed how many current or former Amway IBOs the $225 million pool is meant to cover, and that number will not be public until the Western District of Washington approves the stipulated order and a claims administrator is named. Until then, the $225 million figure describes what Amway has agreed to pay, not a check that has gone out to anyone.

This article was produced with the assistance of AI and reviewed by Morning Overview editors prior to publication.

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