AdvoCare To Pay $150 Million Fine For Operating A Pyramid Scheme

October 3, 2019
advocare water jug

Photo Credit: Joe Maiorana-USA TODAY Sports

After starting an investigation back in November 2016, the Federal Trade Commission has fined the Plano based supplement company AdvoCare $150 million dollars for operating a pyramid scheme. 

The FTC found that the people would pay AdvoCare thousands of dollars to buy inventory and become “distributors”. AdvoCare would then reward distributors not for selling products, but for recruiting other distributors to spend large sums of money pursuing the business opportunity.

FTC Bureau of Consumer Protection Director Andrew Smith said that promotional videos would claim that distributors could earn millions of dollars. 

“The defendants promoted AdvoCare as a life-changing opportunity claiming that consumers could earn millions and millions of dollars working part-time from home." 

AdvoCare said in a statement that they didn’t agree with the FTC’s decision.

“We strongly disagree with the FTC allegations, but we are committed to abiding by this agreement and moving forward. The company revised our business model earlier this year from a multi-level marketing model to a single-level compensation plan.”

It was never brought into question whether the company's supplement products were effective or not. 

Via: FOX 4 News