How far would you go with that? It's not the MLM companies who prey on people's wishful thinking. The MLM companies just provide (sell) the products and the compensation plan. It's the distributors who prey on people's wishful thinking. The MLM companies are sellers of a retail product. The idea that anyone should get money selling their product isn't really the thing they're advertising. The company is selling a product and giving an opportunity for others to sell it for them as another distribution outlet. It's somewhat similar to bloggers who blog about making money. Most of those bloggers make money by selling hosting services. Are the hosting services responsible for how the bloggers sold those services, by offering people the idea they too could make money blogging? Affiliate marketing also comes to mind with this same concept. People put out a product and allows other people to advertise for them and make a portion of the proceeds. It's a very tiny percentage. There are other people who then claim that people can make a living doing affiliate marketing so they'll buy the product from them. Is it the responsibility of the person who puts out the original product to foresee that some people are going into affiliate marketing based on the claims of people distributing their product and might not make much money doing it? If you're claiming that the seller of a product knows or should know how its retail product is being sold, where do you draw the line that voluntary distributors of that product need to be protected that they may not make a living doing it? How would you distinguish these businesses from businesses that also sell retail products and pay people to distribute those products for them, which is pretty much any product you see on any store shelf? Any distributor of any product has the potential to lose money buying a physical product and not being able to sell it. Edit: I just looked up consumer protection in wikipedia because I wondered if distributors of product are still consumers. According to wiki, consumers are - I don't know whether the protections of the consumer protection laws work in the same way for distributors.A consumer is defined as someone who acquires goods or services for direct use or ownership rather than for resale or use in production and manufacturing.
The difference to me lies in the frequently misleading claims about earnings, the social pressure on a susceptible segment of society to spend money they don't have, etc.
John Oliver showed the disclosure of the company about the claims about earnings, the one about the average distributor making less than $10. That's a company disclosure. The company is not the one doing the misleading. If it happens, it happens at the distributor level. There are people making money from their distribution business. Those people aren't necessarily making claims either, but people see that and think they can emulate it. It's very similar to looking at someone with a successful blog or youtube channel and thinking they can emulate it. There's always social pressure on people to spend money they don't have. You would have to eliminate advertising to do away with that. Those people who are saying that they spent thousands of dollars got actual products that they can't resell. But they did buy actual products. My question is, how would you regulate this industry without affecting any other industry? The government has been making attempts for a long time. The only unique thing about an MLM company is that they allow distributors to purchase and resell product on a very small scale. It might be possible to put more regulations on distributors, but as you've seen, they're not the most knowledgeable. Putting more regulations on them would just be more burdensome to the people you're trying to protect. Keep in mind that if you eliminated this multi-billion dollar industry, you'd be eliminating a lot of people's livelihoods for the people who are successful at it. John Oliver's solution is to tell people not to join it. MLMs have a bad enough reputation in his demographic audience that I doubt that the people watching it will be changed in their position. I looked at the comments yesterday and was surprised to not see it filled with people giving their experience of losing money. I looked at it today, and there's a bit more of that. He's not saying anything new to his demographic audience. The reason I replied to this OP was because not only does his solution seem ineffective, he also created misleading information about the industry in his attempt to mock it. Neither helps clean up the industry.