What is the Vema scam you ask? Well, it’s official, the FTC has shutdown Vemma, a health and wellness multi-level marketing company that lures people in with promises of wealth.
It’s one of the most popular multi-level marketing companies in the health niche.
Like most multi-level marketing companies, Vemma pays members to recruit more members with false promises, an illegal marketing tactic.
Unfortunately, there are thousands of active companies just like Vemma that use unethical recruitment strategies.
In this article, we will take a look at Vemma and analyze their business model and see if we can spot the red flags that lead to it’s downfall.
After reading this article, it will be easier for you to spot similar scams, and it will be more difficult for salesmen to recruit you to their little inner-scam circle. And it will make it easier for you to find a system that truly works!
What is The Vemma Scam?
Vemma’s business model was much like every other multi-level marketing company out there.
The members can earn affiliate commissions for recruiting new members and then they earn a residual amount for their recruit’s activities.
Each mlm system uses the same basic structure but rewords different aspects and introduces different terms to disguise the illegal aspect. In Vemma’s case, they use Points, Volume, and Cycles.
The idea is to make as many Cycles as possible, each Cycle is worth about $20 and it’s paid in U.S dollars. Vemma uses a team building system, there are two ladders; the right side and the left side.
In order to create a full cycle you will need to accumulate 360 points on one side and 180 points on the other side. Once you team reaches that limit, that’s one cycle, and then you have to keep earning more points to earn another cycle.
How the Vemma Cycle Works:
Take a look at the screenshot below to see how a cycle works.
The two blue circles represent new recruits, that’s a three person team, and you are the manager of the team.
You have to recruit two people, one on each side, and then collect enough points to earn a cycle. That’s the compensation plan in a nutshell.
So how do you earn points?
You earn points when you or one of your recruits completes a certain action. For instance, if one your recruits makes a sale or purchase a product from Vemma you are rewarded a few points.
So, the idea is to recruit new people and then make sure that those new people buy products from Vemma and then Vemma pays you a bit too. You also have to pay to join so Vemma makes some money from that too.
Basically, everything that you do within the system sends some money in Vemma’s direction, it’s only fair that they send a bit back to you (they can afford too, it’s a small amount compared to what they earn).
It’s clear that this is not a good business model and pretty unethical too. But I think the main reason Vemma was shutdown was because of all the false promises.
Vemma’s False Promises: Finally Busted
Contrary to what you might think, it is illegal to tell people that they will earn thousands of dollars if they sign-up to your system.
The reason there’s so much spam and hype online is because it’s just difficult to take legal action against websites.
You can create a website with a fake name and other details, so it’s impossible for people to take legal action, even if complaints are filed, the government will have a hard time shutting down your operations.
That’s one of the reasons so many of these systems are still active!
The full FTC report summarizes what I have been saying about multi-level marketing in articles on this website.
Vemma pays members to recruit new members but doesn’t encourage members to teach their recruits how to promote the products.
It’s all based on recruiting new members because every new members needs to pay a sign-up fee and that fee usually goes to the person who recruited them.
So the most lucrative option for Vemma members is to mass market their affiliate links and recruit new people. Even though there are a lot of Vemma products to promote, the focus is not on promoting those products, it’s on recruiting new members.
Even back in 2013 there were over 140 complaints filed to the FTC about this company!
In order to recruit new people, Vemma marketers resort to high-pressure sales tactics, like promises of Yachts, sports cars, and $50,000 a week.
Not to mention the vast majority of members earn very little money from this system, if they earn any at all.
The Risks of Investing in MLM Businesses:
Read our detailed guide on why multi-level marketing is a terrible business investment.
Some multi-level marketing businesses are not completely illegal, if they don’t resort to cheap marketing tricks.
However, multi-level marketing systems require a lot of work and a lot of cash.
You will hear MLM enthusiasts claim that you won’t make any money unless you work hard, “You get what you put in!” they’ll say, the truth is that it’s just not a viable business.
What about all the people who invested in Vemma and built their business on selling Vemma products?
Well, their entire business just went down the toilet. It’s sad. But that’s what happens when you invest your time and cash into a flimsy business foundation.
What Do We Recommend:
That’s one of the reasons I always recommend creating your own business.
It could start of as a simple website, but in a few years it could be your main source of income. I’m sure most Vemma members didn’t think that the company would shutdown, but it did.
So, if you’re interested in creating a online business, then create YOUR OWN business, a website, a service, a software; anything – but it must be completely in your hands. You have to be in control.
There is a online business course that I highly recommend, I am member, and I can honestly say that it was a lifesaver!
It takes you from step one and shows you how to set up a website from scratch, ideal for beginners who are new to online business.
The best part?
It’s free to check out, there’s a free trial.
Here’s My Top Recommended Training >>
Check out this comparison chart to see all the Wealthy Affiliate provides budding online entrepreneurs like yourself and you’ll see that you have all the support, education, and training you need to get an online businesses rolling.
I’m sure you will love it! Got any ideas on the Vemma scam? What is the Vemma scam in your opinion? Let us know below.
I am glad that at least this program has been shut down by the FTC. It would be good if they close a few more scams, MLM or other.
The Vemma scam is particularly bad because they seem to have particularly targeted young people, trying to get students to sign up. Maybe they are easy prey, but so unethical.
The problem with these schemes is that they are often focused on getting recruits, with very little focus on selling products. That’s probably why they were shut down, for being a pyramid scheme.
As you say you don’t get much help in most MLMs so, your chances of success are pretty feeble. Add to that the hype and the fact that they will tell you it’s easy to make money and you will disappoint most recruits quite quickly.
Perhaps some good will come out of this and MLM programs will clean up their acts, offer better products and concentrate more on selling these. This is still a business model I don’t appreciate, I think building your own legitimate business is a much better option. As you say so well – stay in control.
Thanks for another great review.
Thanks for stopping by and for your input on the Vemma scam. It is good that these types of predatory companies get shut down and be made an example of. As well as, hopefully, discourage more unsuspecting people to become leery of get rich quick scams that take from unsuspecting people.
That was one thing that I liked so much about Wealthy Affiliate when I was first introduced to them. They didn’t say I was going to get rich, or that I’d make any money, they just told me they’d teach me how to build an online business through building a authoritative niche based website.
They offered me an education in website development, keyword research, affiliate marketing, and much much more. Never did they blow smoke up my ass and tell me I was going to get rich quick, but that’s what everyone wants to hear and believe.
When you wake up and realize that online success takes real work and the ability to provide your niche site with value, then success comes naturally.
Thanks again Peter for your feedback and always insightful comments.
Hi Todd, Great Review!!
I was looking into Vemma a few years back but now i am glad i didn’t commit to it would have been a big mistake!! Regarding Wealthy Affiliate, your right, it is a the best platform for a budding online entrepreneur, it teaches you how to make money online for real!! which is what i had been looking for.
Hi Gino, thanks for your feedback on the Vemma scam. Good thing you didn’t go forward with these guys.
And you are absolutely right, WA has all the resources and tools one needs to get started building a REAL online business, the only thing that one has to bring to the table is a willingness to learn and be ready to take action on what you learn and apply it to your online business.
At least we all now know what the Vemma scam is.
Thanks for your feedback and take care,
I’m actually glad that Vemma finally got what it deserved because it’s wrong to scam people. I hope this has sent a shockwave through the internet that sends a clear message to all other MLM scams. The owners should be quaking in their boots!
I have been a Network Marketer in the past with a legit business model helping people to save money on their bills by using cheaper day-to-day utilities that they’re already using.
It worked so well because it was more service based and it created a residual income.
The reason I quit was because I saw a much bigger potential in affiliate marketing with less hassle from people too.
Because of programs like Vemma, Empower Network and MAPS etc, they give MLM a very bad reputation, and so people find it hard to trust the industry.
This is a great Vemma review, and I would choose Wealthy Affiliate any day!!
Thanks for your feedback on my Vemma scam review as well as your experience with affiliate marketing and network marketing. You make some excellent points about both.
I tend to side with you because of the time constraints and I think it’s easier to earn money with affiliate marketing, but I do see how you could put them together or at least use your own website for both and have better results. As long as you have a good mlm/network marketing product that has value.
Have a great day,
Rick Bell says
Well I know all mlm companies are not like this of course. But people always tend to put mlm all in a category of scam programs. Or say only the people at the top make money.
I beleive that much is true with just about anything though.
mlm programs are very confrontational here online that is for certain.
The title: VEMMA AUGUST 2015 SHUTDOWN: WHAT IS THE VEMMA SCAM
…is certainly a good one you picked.
I had heard of Vemma being mentioned a while back and how many were trying to portray it as a scam progam. My first thought was what are they doing, cheating by not giving out enough product for the money? LOL Silly me.
Good information here. I like it.
Thanks Rick, good to get your take on the Vemma scam. And you’ve got some good points about mlm’s. I’ve had my experience with a few 20 some years ago, and I made some money, but worked my tale off. But I think that’s the key is that you’re invested in something that you know represents a product that is better than what currently exists in the open market.
The other point is that even with a good product, I think mlm’s make the mistake, and maybe this is how the get recruits, of selling the concept of easy money. And that isn’t the case with any business.
For sure, you could enhance mlm product sales by using a website and writing quality content based on your niche mlm product. And that I think is a great idea.
As long as you have solid products that help people, you could do great by driving traffic to the product through a website and engaging your target audience through keyword phrases that people are naturally searching for on a daily basis.
I like this approach much better than trying to sell your friends, co-workers, and family, or by spamming social sites like Facebook.
Thanks again for your input on Vemma Rick and have a great day,
Hey Todd, great review about the Vemma scam!
I was actually offered to join this program by someone on Facebook. I think that is what I really hate about network marketing… you friend someone on Facebook and then they are hounding you to join this holy grail of network marketing opportunities.
I have had to unfriend and block a couple of these people. It seems that just because you have an online presence, it gives these people open slather to try and recruit you.
I am definitely not interested in multi-level/network marketing companies. I prefer to spend my time on building my online business in a much more ethical way.
Sounds like Vemma is just one big scam anyway and I am very glad I did not get involved!
Thanks John for your kind feedback on the Vemma scam. I too fee the same way about most MLM’s. If their products are of better quality and around or less than the same price in the local stores, I’m open to trying them. Especially with health related products. But for make money products, I avoid MLM’s at all costs.
The key thing I dislike about MLM’s is the false appearance that they give inexperienced business people or online marketers about how easy it is to make tons of money. They paint this false perception in people’s minds and the people who join the MLM’s usually lose money.
Great minds think alike John 😉
Have a great day,
John Rico says
Questions about what is the vemma scam are all been clearly answered. Actually I am also very curious with Multilevel Marketing. Way back in my college, my classmates always invite me in joining one. There were several companies that I joined but haven’t got back my investment. MLM really needs dedication and time. Which in that time I was lacking though.
But this time I am already prepared. However I still lack the money to join them. Good thing I bumped into Wealthy Affiliate. It’s a business training center that has tremendous benefits that I can gain and aside from that the starter membership fee is FREE. How cool is that.
By the way, Do you have any MLM companies that you know that are legit? Or should I first concentrate on Wealthy Affiliate?
Thanks for your feedback on the Vemma scam and Wealthy Affiliate. The problem with MLM’s is you’re dependent upon someone else’s products or on your performance of your down-line. If either of these things fail, your business is ruined.
With Wealthy Affiliate, you are learning how to create an online business based on products you know and like, that people use everyday or on building your own products. You are also creating your OWN ONLINE BUSINESS and not someone else’s business.
I’ve dabbled in MLM’s in my college days and was disappointed, and I have found one that I would like to pursue more because I think they have the products to back them up, but I’m waiting to promote them after I study them more and through a different niche website.
I would highly recommend that you stick with Wealthy Affiliate and master website development, content creation, SEO and video marketing first, then see what comes along.
Thanks John for your feedback on now you know what is the Vemma scam – Cheers.