Madoff-ravaged Mets enter into a stadium deal with ... Amway
The Amway Business Center at Citi Field. http://www.amwaybusinesscenterny.com/
5:02 pm Feb. 25, 20139
Amid fresh reports that the Mets are still in debt, Amway has moved into a storefront at Citi Field.
The imagery isn't great for the Mets, to say the least. Amway, a business known for false promises of riches, was busy settling a class action lawsuit alleging the company is a pyramid scheme at the same time Mets' ownership group was fighting a lawsuit by the trustee for the Bernie Madoff victims over its role in Madoff's Ponzi scheme.
But the cash-strapped Mets, who only recently contemplated putting a casino next to their stadium, seem to have made the calculation that whatever money they're getting from the deal trumps any cosmetic problems that might stem from the association.
The Citi Field outpost is Amway's first storefront in America.
On Saturday, Amway staged a grand opening (or "grand opening": it got no coverage, as far as I can tell) with the Amway sign just a few feet away from a Mets ticket booth.
Amway is a multilevel marketing opportunity, to use the euphemism, or a pyramid scheme, to use the terminology of its critics. Individuals sign up as "Independent Business Owners", or I.B.O.s, to sell an array of Amway products, buying them up front while simultaneously recruiting others to join Amway as well.
The Federal Trade Commission differentiates between legitimate MLMs and pyramid schemes using a set of criteria that came into being in part because of complaints about Amway going back decades. The most basic requirement is that participants sell a reasonable percentage of the products to outsiders, meaning the company is not subsisting primarily on new backers buying in to pay the old backers.
When a class-action lawsuit against Amway's now-defunct North American distribution arm, Quixtar, asserted that products were almost always sold to the next level of distributors, that Amway participants were asked to pay exorbitant up-front costs, that well over 99 percent of Amway participants lost money and that any effort to recoup losses were only possible in an expensive arbitration process, a judge allowed the lawsuit to go forward, calling the Amway contract stipluations "a weapon to harass ... and ultimately bankrupt their opponents."
A year later, Amway settled the suit for $155 million.
Amway's troubles aren't over; there's been renewed focus on MLMs of late, with Herbalife, a company operating using Amway's business model, declared a pyramid scheme in a European court last year.
The company revealed that the Securities and Exchange Commission is now investigating it. The Federal Trade Commission recently shut down Fortune High-Tech Marketing, another MLM, in January.
Coincidentally, David Einhorn, the hedge-funder who came close to becoming a Mets owner, is helping to lead the fight against Herbalife here in the United States. He asked questions about Herbalife's business practices on a conference call last year that dropped the company stock from $70 per share to $56; today, it sells for just over $36 per share.
"These are bad signs for the MLM industry," Robert FitzPatrick, president of Pyramid Scheme Alert and expert witness in the class action suit against Amway, said in a telephone interview Monday. "There are about 500 MLMs. I've looked at many of them. Not one would have passed the [Federal Trade Commission legal] test. Obviously not Amway. It did not pass that test."
FitzPatrick said he didn't know why Amway would open a retail storefront, the first of its kind in the United States, other than to provide legitimacy for the brand by associating it with a known commodity like a Major League Baseball franchise.
(Several years ago, Amway also procured naming rights to the home arena of the N.B.A.'s Orlando Magic, whose owner is an Amway co-founder.)
Neither Amway nor the Mets provided any additional information about the storefront, including how much Amway is paying the Mets for the space.
A spokeswoman for Amway confirmed for me that the opening took place on Saturday.
The Mets have yet to respond to multiple calls and emails asking for comment.
At the website promoting the new storefront, Amway describes it this way: "The Amway™ Business Center at Citi Field is a dynamic, one-of-a-kind facility. It was created to provide all IBOs with a dedicated space to freely connect, learn new valuable insights, and share the exciting Amway opportunity with prospects. From reserving meeting rooms to learning about upcoming training events – everything you want to know about the Business Center can be found on this page. Just be sure to check back often for new and exciting announcements!"
Within the I.B.O. guidelines, there's this caveat: "Our lease with Citi Field states that no solicitation shall take place outside of the Business Center. Handing out samples, business cards and / or literature on Citi Field property is not allowed."
A Mets home schedule, complete with team logo, is prominently featured on the site's home page.
UPDATE: The Mets have sent over the following statement: "We designed the ballpark with approximately 40,000 square feet of retail along 126th Street and are pleased that Amway has joined McFaddens as a retail tenant at Citi Field."
UPDATE: Amway provided me with some details about the deal in an interview, which I wrote up here.
Here's a copy of New York's law concerning pyramids. It might be helpful to compare the Amway plan with the terms of this statute. Perhaps Attorney General Schneiderman might want to see if this is how New York wants to promote the Mets.
Article 23-A. Fraudulent Practices in Respect to Stocks, Bonds and Other Securities (Refs & Annos)
§ 359-fff. Chain distributor schemes prohibited
1. It shall be illegal and prohibited for any person, partnership, corporation, trust or association, or any agent or employee thereof, to promote, offer or grant participation in a chain distributor scheme.
2. As used herein a “chain distributor scheme” is a sales device whereby a person, upon condition that he make an investment, is granted a license or right to solicit or recruit for profit or economic gain one or more additional persons who are also granted such license or right upon condition of making an investment and may further perpetuate the chain of persons who are granted such license or right upon such condition. A limitation as to the number of persons who may participate, or the presence of additional conditions affecting eligibility for such license or right to recruit or solicit or the receipt of profits therefrom, does not change the identity of the scheme as a chain distributor scheme. As used herein, “investment” means any acquisition, for a consideration other than personal services, of property, tangible or intangible, and includes without limitation, franchises, business opportunities and services, and any other means, medium, form or channel for the transferring of funds, whether or not related to the production or distribution of goods or services. It does not include sales demonstration equipment and materials furnished at cost for use in making sales and not for resale.
3. A chain distributor scheme shall constitute a security within the meaning of this article and shall be subject to all of the provisions of this article.
New York's Law and Amway:
In a ponzi scheme a Bernie Madoff character pays investors from the money of "new recruits".
Amway pays no money for recruiting. All bonuses are paid on the movement of products and services. That's why Amway has an A+ Rating with the Better Business Bureau and partners with Partner Stores like Best Buy, Sears, Dell, and Bank of America. A company like Best Buy is not going to officially partner with a ponzi scheme.
There is no get rich quick mentality in Amway, its takes hard work and effort like any other business to do well.
Why wouldn't the Mets be proud of having a great company like Amway have a store near them? After-all, the NBA Orlando Magic Basketball play in "Amway Arena" and the official sponsor of the NHL Detroit Redwings is Amway.
The Amway business is not for everyone, but with nearly 40 Billion Dollars payed in bonuses, over 55,000 brand new Platinums worldwide in 2011 (Amway discloses the average income at Platinum is $40,125/yr in North America) and sales of 10.9 Billion dollars it obviously works for those that work it. If your not willing to work and not self motivated Amway is not a way to make a living, but like anything you get what you put into it.
Its a virtually risk free option as well as they have 90 day money back guarantee on the business registration and any business support materials anyone might buy - no questions asked.
How is anything that has a money back guarantee no questions asked going to take advantage of anybody? Amway even has a 180 day money back guarantee on their products - no questions asked.
I do make my living as an Independent Business Owner and my experience may be different then yours, but what I can say is it is a low cost, virtually risk free way to give yourself an opportunity to try a business of your own.
Lastly, Amway keeps track of client purchases and requires a certain amount of client sales as required in the 1979 Federal Trade Commission that ruled that Amway was a legal business and the model for all other businesses in the industry. Herbalife does not keep track of Customer sales and is in hot water because they have a hard time to prove that they have clients the required amount of client sales like Amway was required to have since 1979. So Amway has not issue with the FTC or SEC, its Herbalife.
Quite obviously, this latest obstructive move by the billionaire bosses of 'Amway' forms yet another part of an overall pattern of ongoing major racketeering activity (as defined by the US federal Racketeer Influenced and Corrupt Organizations Act, 1970).
The so-called 'Amway Income Opportunity' (which has been hiding an effectively 100% loss/churn rate) is a dissimulated, blame-the-victim closed-market swindle, in which billions of dollars of unlawful losing-investment payments (made on the false expectation of future reward) have been falsely declared as 'lawful sales (based on value and demand).'
Lurking behind the initial 'Amway' pyramid fraud has been a related advance fee fraud in which billions of dollars of effectively-valueless materials (comprising, publications, recordings, tickets to meetings, etc.) have been peddled to the 'Amway' faithful on the pretext that these 'optional tools' are 'vital to achieving success.'
Indeed the scripted-comment....
'If your not willing to work and not self motivated Amway is not a way to make a living, but like anything you get what you put into it.'
... is also part of the same overall pattern of ongoing major racketeering activity, in that it is designed to prevent victims of the 'Amway' swindle from facing reality and complaining, by convincing them that failure to make money in 'Amway' was entirely their own fault.
Howard,
You need to get your facts straight, an international highly respected multimillion dollar corporation with relationships with IBM, Disney and hundreds of other highly respected lawyer filled companies who regard their reputation as paramount are partners with the Amway corporation. As a longtime met fan it is a very positive thing to show that the are far removed from the Bernie issues and/or affiliations with any kind of illegal practices. Research Orlando magic ownership, sponsorship San Jose soccer team and partnership with Detroit redwing hockey. Not to mention miss America and Olympic athletes
Don't show your ignorance so obviously just to make headlines
Thanks
So let me get this straight if I'm a bussiness owner and I don't sell my products is my suppliers fault ? That's is so stupid amway is a wholesaler of great products and they have independent bussiness owners that sell their products all over the world creating opportunities like in my country Dominican Republic where there are no jobs and my family lives off selling amway products wich are some of the best on the world this is why America is going to fall if people like you are killing the few companies who offer empowerment like this instead of welfare checks. I apologize if I offend anyone but free enterprise is the backbone of the country and if you don't sell your product is not your suppliers fault is your own.
You are a Moran. Lmao. The Amway logo can also be found on the doors or the the U.S. National chamber of commerce. You must be Hungary for ratings. No one would give a shit who you are unless you piggy backed on Amways name. I looked you up. You are a no body. Lololol. Of course I only found you because Amway gets more hits than you. I guess any Moran can be a reported now a days. Crawl back in your hole. Lololol. Oh. And my name is Corey lides. Here is my telephone number. I bet you don't have balls to post your butter cup. 3478767204. Lololol. What a loser.
David Brear
Let me get this straight its ok to be recruited into a job that pays you a specific amount(usually not enough) because you comlain about how you dont get paid enough), say 20$/hr. They make you do all the work and they(your boss or owner of the company) get probably 200% on top of you doing all the work and thats ok for you? A job is a legal pyramid scheme. You cant make more than the guy on top. Amway is legal. If it wasn't they wouldn't have been here for 50+ years and going strong. We'll get you soon buddy. The mlm industry is 26billion, which 11.3 of it is Amway. Safeways, Costcos, Save On foods are scared because if we use Amway to supply our households and help others do the same then they(Safeway.ETC) lose sales.
The world is changing. Love it.
Also I forgot Howard,
Robert Fitzpatrick said "These are bad signs for the MLM industry," Robert FitzPatrick, president of Pyramid Scheme Alert and expert witness in the class action suit against Amway, said in a telephone interview Monday. "There are about 500 MLMs. I've looked at many of them. Not one would have passed the [Federal Trade Commission legal] test. Obviously not Amway. It did not pass that test."
Amway was investigated by the FTC in the 70's. Amway passed the FTC test and now the FTC actually compares any new mlm with Amways plan to see if the new mlm is legit. So he's actually really wrong when he said they didn't pass cause now they are the benchmark.