When you sign up as an Herbalife distributor, the last thing you want is not to waste time and money. The whole point is to make more money so you can finally get past 9 to 5, Travel more, or buy something nice. Back in 2016, FTC reported that half of Herbalife’s top distributors actually make less than $5 per month selling products. Some even opened physical stores to promote and sell the company’s products, but in the end they still lost money. The company had to pay back a staggering $200 million to distributors and consumers. The FTC agreement also requires Herbalife to change its compensation model and stop making fraudulent earnings claims.
The FTC says some of the distributors who actually make the money are the ones with the largest number of employers. Simply put, their income doesn’t come from selling products – and that is pyramid diagram, not MLM. The FTC explains that companies using a pyramid scheme incentivize their members to hire others rather than promote and sell products. On the other hand, MLM generates revenue through direct selling. An MLM company may choose to reward its members or distributors for attracting new recruits, but the focus is on the product itself. However, both MLM and pyramid schemes often require an initial investment, so you run the risk of losing money.
https://www.thelist.com/739288/is-herbalife-an-mlm/ Is Herbalife an MLM?