The Federal Trade Commission and the Washington State Attorney General’s Office announced a proposed $225 million settlement with Amway Corp. and two affiliated organizations over alleged unfair and deceptive practices connected to the company’s multilevel marketing program.
The agreement, announced on September 17, 2026, would resolve allegations involving Amway, World Wide Group and Leadership Team Development. The case was filed in the U.S. District Court for the Western District of Washington, where the proposed settlement must still be reviewed and approved before it becomes final and legally enforceable.
According to the Federal Trade Commission, the companies allegedly used misleading earnings claims and recruitment strategies to attract participants. The agencies also allege that some recruits were pressured to purchase products and training materials as part of their participation in the business opportunity.
Allegations over income claims and purchases
The complaint described by federal and Washington authorities alleges that certain affiliates promoted the possibility of earning more than $40,000 a year through Amway’s business model. The agencies said those representations did not reflect the financial experience of most participants who joined after 2020.
For that group, authorities allege that most participants spent more on products and training than they received in income. The allegations focus on the way earnings opportunities were presented to prospective recruits and on whether participants received a realistic picture of the costs and potential returns associated with the program.
The agencies also allege that some affiliates encouraged the reporting of sales that had not actually taken place. In addition, the complaint addresses purchases made by participants and the role of training materials in the recruitment process. The proposed agreement would impose new requirements intended to provide greater oversight of those activities.
How the proposed settlement would work
The proposed order would impose a $225 million judgment against the defendants. The FTC and the Washington Attorney General’s Office described the amount as the largest monetary recovery obtained by the federal agency in an action involving a multilevel marketing company.
Nearly all of the money would be used to compensate participants who lost money after being recruited through Amway’s affiliates. However, the FTC has not yet released the final details of the compensation process. Eligibility requirements, claim procedures and the timing of any payments therefore remain to be determined.
The financial terms are accompanied by changes to the companies’ business practices. Under the proposed order, participants would be required to resell at least 70% of the products they purchase each month. Recruiters would also receive lower compensation when recruits purchase products without reselling them.
The agreement would further require audits of sales records and reporting of customer transactions. New recruits would have to complete compliance training before they could recruit other participants, adding a formal condition to the expansion of the business network.
Settlement is not yet final
The Washington State Attorney General’s Office said the agreement remains a proposed settlement rather than a final court judgment. Because the case is pending in federal court, the judge must approve the agreement before its monetary and operational provisions take effect as a legally enforceable order.
That distinction is important for participants and potential claimants. Although the announcement establishes the proposed value of the settlement and outlines the planned changes, the final structure of compensation will depend on the court process and on additional information from the FTC.
The case places consumer protection and income representations at the center of the regulatory scrutiny. It also shows how federal and state authorities can coordinate in actions involving multilevel marketing companies, independent business participants and the sale of products through recruitment-based networks.
Why the case matters to participants
Amway operates across the United States, making the allegations relevant to participants and households considering direct-selling opportunities in different parts of the country. The proposed requirements would affect how products are resold, how recruiters are compensated and how sales activity is documented.
The case also highlights the importance of distinguishing between revenue claims and actual income after expenses. The allegations described by regulators concern not only the amounts presented to prospective recruits, but also the costs of products and training that participants may incur while pursuing the opportunity.
Until the federal court rules on the agreement, the $225 million settlement remains subject to approval. The FTC’s announcement and the Washington filing provide the current framework for the proposed compensation and compliance measures, while further details will depend on the next stages of the case.
