The Minnesota Attorney General Hubert H. Humphrey III provided the following CONSUMER ALERT entitled, “Attorney General Warns Consumers of Claims of Marketing Company Operating in Minnesota.” Here are quotes and summations of AG Humphrey’s statement:
“Attorney General Hubert Humphrey III is warning consumers not to believe claims that his office has “approved” of a marketing plan now operating in Minnesota known as “Trudeau Marketing Group.” According to dozens of calls to the Attorney General’s Office from all across Minnesota, marketing representatives have claimed that the Minnesota Attorney General’s Office and other attorney generals around the country have “approved” the company’s business plan.
” ‘ If someone says that my office approved this or any other marketing plan, it’s simply wrong,’ Humphrey said. ‘We don’t lend our stamp of approval to any business conduct or pre-approve any type of marketing programs. Consumers should be highly suspicious of any companies that make these types of claims.”
“According to information provided by consumers, Trudeau Marketing promotes itself as a multi-level marketing company. Some consumers have called the Attorney General’s Office to ask whether Trudeau Marketing runs a legitimate marketing plan, or is an illegal pyramid scheme. Humphrey says his office is reviewing information it has received from consumers but has made no determination about the company’s status.”
Humphrey points out the distinction between an MLM and a pyramid scheme by saying that a legimate marketing plan emphasizes the selling of products while a pyramid scheme emphasizes recruiting new members. And, he cautions that many illegal pyramid schemes try to appear as legitimate MLM’s ‘by using a line of near-worthless products or newsletters and claiming to be in the business of selling them. In such cases, there may be little or no demand for the products and they are incidental to the recruitment of new members, who keep the pyramid alive by paying large fees to join.
“If you make money by bringing in new members, rather than selling a real product, it’s an illegal pyramid,’ Humphrey said. ‘All pyramids eventually collapse because they require an infinite supply of new members. The promoters may make a lot of money, but others down the line will end up holding the bag.’
“The Attorney General also cautioned consumers to be wary of paying large up-front fees to purchase products in any multi-level marketing plan… [that] generally requires each new participant to pay hundreds, or sometimes thousands, of dollars for products that they may have difficulty in selling.’
“The Minnesota AG advises MLM prospects to: (1) Take your time and don’t succumb to high-pressure tactics, including promises of high income potential; (2) Carefully review any contracts; (3) Be cautious about any large upfront fees or products purchases for resale; (4) Find out about the competency and experience of the company and its officers, the products and your market, start-up fees, buy-back provisions, and actual earnings of current distributors; (5) Check to ensure that the products are actually being sold; and (6) “Don’t ever believe that a program has been examined and approved by the Attorney General’s Office.” If you hear this contact your AG’s office. Such claims are illegal in many states.
“Trudeau is the leading Nutrition for Life distributor.”
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This post was written by admin on December 18, 2008
