Amway independent business owners would have to resell at least 70% of what they buy each month under a proposed order the Federal Trade Commission announced on Sept. 17, 2026, as part of a $225 million settlement with Amway Corp. and two affiliates. The order is a proposal that needs a federal judge’s approval in the Western District of Washington, and the FTC says information about any redress program will come at a later date.
A proposed order that a judge has yet to sign
The FTC’s announcement describes a settlement with Amway Corp., World Wide Group, L.L.C. and Leadership Team Development Inc., which the agency calls the largest monetary recovery it has obtained in an action against a multilevel marketing company. The agency notes that “stipulated final orders have the force of law when approved and signed by the District Court judge.” Until that happens, the rules below are terms the defendants have agreed to on paper, not obligations in force.
Christopher Mufarrige, director of the FTC’s Bureau of Consumer Protection, said in the release: “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 complaint’s allegations are the FTC’s, and the settlement resolves them without any court finding of wrongdoing at this stage.
What counts toward the 70% resale threshold
The proposed stipulated order states the rule in more detail than the press release. Under it, the marketing plan requires that each participant’s “Eligible Customer Sales” equal at least 70 percent of the participant’s monthly product volume. Only sales to registered customers who are not themselves participants count. Self-purchases and sales inside a participant’s own downline are tallied separately and do not satisfy the threshold.
The order also builds in a penalty for falling short. Below 70 percent, a participant’s credited business volume is scaled down by the ratio of actual eligible customer sales to that 70 percent line. In practice, an independent business owner who buys heavily and sells little to outside customers would see bonus credit shrink under the formula.
Recruiting is no longer supposed to drive pay
The FTC says the order substantially reduces recruiter compensation when recruits buy products but do not resell them. The order text goes further: it says purchases are “not required as a condition of receiving any Benefits” and that benefits are not offered for recruitment or enrollment. Before enrolling a new participant, an upline participant must have made eligible customer sales to at least three different eligible customers.
Two more provisions target the paperwork. The order requires receipts within 24 hours listing the purchaser’s name, the date, the products and quantities, the amount paid and the payment method, sent by email or text with a way to report issues to Amway. The FTC also says participants who fake sales or teach others to do so must be terminated. An independent auditor, chosen by agreement between the FTC and Amway, would review eligible customer sales and enrollment data each year at Amway’s expense.
Training before recruiting, and no first-year training fees
Under the FTC’s description, distributors must complete training before they recruit, and approved training providers may not charge new business owners for training or services in their first year. The order specifies training on the sales requirements, the ban on falsifying sales, inventory purchasing limits, refund procedures and how to submit complaints. Most compliance provisions run for 10 years from entry of the order, with a nine-month grace period before the core requirements take effect.
What the FTC’s complaint says business owners earned
The FTC’s complaint, filed Sept. 17 in the Western District of Washington, alleges that the earnings claims did not reflect what most distributors received. It says median annual bonuses before expenses were $139 in 2023, that fewer than 1,600 of 241,000 business owners earned $40,000 or more a year, and that fewer than 500 earned $100,000 or more across 2020 to 2023. For owners who started between 2020 and 2023, the complaint alleges average bonuses of $175 to $630 were smaller than their training costs.
The FTC’s release alleges that most owners who joined World Wide Group or Leadership Team Development after 2020 spent more on Amway products and training than they received from Amway, and that the advertised earnings were “exceeding $40,000 a year.” The complaint also alleges that business owners bought 77 percent of Amway’s products in 2023. The complaint lists six counts, including two under Washington’s Consumer Protection Act.
The $225 million and the redress that has not been defined
The FTC says nearly all of the $225 million “will be used as redress to consumers harmed by Amway and its affiliates’ allegedly deceptive tactics,” while information on the redress program will be provided later. No claims process, eligibility rule, payment date or per-person amount appears in the release, so no reader should treat any payment as coming. The order itself says the payments are held in escrow pending court approval.
Washington joined the case as a co-plaintiff. Attorney General Nick Brown said in the state’s announcement that “Amway and its affiliates profited by taking advantage of regular people’s hopes and ambitions.” The state’s release does not give a date for final court approval.
Questions to ask any distributor before buying in
Retirees are often pitched a side income by a friend or neighbor, and the FTC’s consumer advice on multilevel marketing lists questions to put to the person doing the recruiting: how much they made last year after expenses, whether recruits are needed to earn money, and what share of income came from customers outside the network. It warns that promoters who stress recruiting as the real way to make money are a red flag.
The same page states the agency’s general conclusion: “Most people who join legitimate MLMs make little or no money. Some of them lose money.” Complaints can go to the FTC or a state attorney general’s office.
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This article was produced with AI assistance and checked against the primary sources linked above.
Warren Cohen is a finance writer based in Phoenix, Arizona, covering personal finance topics including credit, banking, and beginner investing. He earned his degree in business administration from Arizona State University and began his career working in consumer finance, where he gained direct experience with lending and credit systems. He now writes for personal finance websites and fintech platforms, focusing on clear, practical content that helps readers make informed financial decisions.
