Success Through Compliance
MLM Compliance
635 Brookline Ridge
Alpharetta, GA 30022

Phone:
404.933.6135
Fax: 425.963.0846

Office Hours
Monday - Friday
8am - 6pm EST

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Compliance: Worthy of Attention


Your MLM business is only as strong as each Associate’s compliance of the Company Policies and Procedures adopted. Without compliance, the company is vulnerable to numerous lawsuits and loss of business. Therefore, a successful MLM will invest the finances and time associated with monitoring and removing content that is in direct violation of these policies. Readily available proof of enforcement and compliance is a necessity when called upon by outside critics.

Safeguarding the MLM Company must first begin with the establishing of the Policies and Procedures for all members to follow. Regulations by the Federal Trade Commission are continuing to tighten in an effort to discern the dishonest businesses from the ones that truly offer a quality product or service and a winning income earning opportunity. As an MLM company, you must recognize your responsibility to ensure that every aspect of your business is compliant with the regulations of the FTC, as well as, the FDA (if selling consumable products). The FTC has remained undefeated in every case brought against MLMs with the exception of Amway in 1979. According to Attorney Kevin Thompson in his article, Legitimate MLM or Pyramid Scheme: How can you tell? “FTC v Amway saving grace was policies and procedures that encouraged retail sales.” 1

Even with a high-quality Policies and Procedures document in place, there must be enforcement. Modern technology has made designing and reproducing individual marketing tools a commonplace practice. Internet blogs, forums, websites, email, etc. reach mass audiences. Unfortunately, exaggerated claims aimed at attracting new recruits often bring future legal action against the company. With all these avenues of communication, how does a company monitor, effectively, the marketing of its products and opportunities?

After investing time and funding to create legally secure guidelines, reflect on the way that distributors or associates receive this information. Quality education is crucial to the success of individual compliance. Consider the availability of training materials. Offering a Replicated Site to each member ensures company approved content. Mentors have a responsibility to guide, educate and review new distributors’ work. Knowledge is power. Empower your associates with knowledge of proper operating procedures.

Finding violations is not always an easy process. One effective means is popular search engines. Monitor the internet by frequently searching the company’s name, products’ names and variations of the names. You will see the claims and comments posted regarding the business. Address violations promptly and legally. Unfounded postings will discourage further sales and future participation. A quality attorney who specializes in MLM law can not only defend, but also provide corrective disciplinary action against noncompliant individuals. Seek advice from a qualified accountant regarding the potential of utilizing lawyer fees as a tax deduction. This could help offset some of the costs related to enforcing compliance.

The vision of total compliance is a lofty one. Nevertheless, with proper implementation and monitoring, your MLM Company will boost performance and avoid the visible as well as hidden fees associated with disregard. Compliance enforcement will pilot your company towards achievement.

1 http://www.scribd.com/doc/17733330/Legitimate-MLM-or-Pyramid-Scheme-How-can-you-tell


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