FTC unsafe…

Who else wants to be a hype master?

Pretend you’re in a meeting with prospective reps.

Two people get up to speak. First Tim.

Tim: “Last month I earned $12,547 doing this.”
Audience – “Wow. Cool…”

Then came Lulu.

Lulu: “How much do you want to earn?”
An audience member calls out, “$12,000/mo!”  Lulu
goes, “Let me show you how to do that.”

On the overhead, she uses the math of the pay plan. For example,
if you earn $100 on a recruit order, you’d need 120 recruits to earn $12k…

It is Tim’s statement that will bring the FTC down on you. Here’s why.

It’s not about the truth of his statement.  Tim may well have
earned that from the business.  But with the new FTC regs, he
cannot announce what he earned to others –

Not unless he or a company rep also show the audience what
the typical distributor in that company earns. And we know what
that would look like…:(

Why?  Because Tim’s results are so extremely rare. Tim
stating his big income like that gives listeners the impression
that’s typical, and that they can do it too.

But. Since almost no one earns anywhere near $12,000 in a month,
the FTC now requires that the company must disclose the typical
distributor earnings at the same time as a big earner announces his or her

Because.  Tim’s results are so extremely rare.

Bottom line: If you don’t have your company’s “typical distributor income”
numbers, it’s against the FTC regs to say “I earned $X” to others. If that is
intended to encourage them to join.  (Why else would anyone announce their
earnings to others?)

Lulu’s statement however, and her explanation above, is FTC safe.
Because. It’s based on the math of the pay plan. It’s not an income claim.

Using the math of the pay plan this way is like saying the
distance from LA to NYC is 2,462 miles (3961 km).  IF you
want to make that trip, or earn a specific income, you must
cover 2462 miles somehow, walk or fly, or,  bring in so
much money in orders – from recruits and customers –
into your company.  Since you earn a percent of that amount,
and companies to not limit how much money you can bring in,
the income is infinite.  🙂

This is a tip from the Hype Master module of the new Authority:
How To Get It In One Week
program. I’m planning to make this module
available as a stand alone.  A cool little 2 hours of audio and
transcriptions for readers (PDF) who want to learn to avoid FTC problems
and also defend their group from the hype of competitors who want
to steal their babies with their hype…

It’s the session we did with Len Clements.

If you’re interested, email me here.  Hype master is $67.  But for early birds, $47.


About the author

Kim Klaver


  • Oh, I love it. makes it so simple…I want to make $xxx.xx how do I do it? Gosh I wish I had seen this a few years ago !!

  • Thanks Kim for showing us how to stay out of trouble, and present with integrity at the same time. It’s time for those of us who want to make our income in this industry and be free to take some responsibility to kill the hype and stick to the truth. Folks, there are still some MLM heroes out there like Tim Sales and Kim Klaver who do it correctly. There are also some in your company that have the same constitution. Seek them out and do what they do. Burning my soap box now:)

  • I just don’t see why they don’t say both things when they talk about earned income.

    To me, it would give you even more credibility to say, “I earned $12,547 doing this, BUT, this result is not typical. In fact, the average person in this company earns_____.”

    What is so hard about that?

    In practically any industry, there are folks who earn a significant income, while others make far less. The president at the bank makes a lot of money, while the teller usually doesn’t. And son on.

    • What is so hard about that, Paul? When the audience hears how few people make any money at all,
      most people would probably not sign up. That means almost no initial orders from the crowd.
      Not good for business.

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