MLM schemes in the UK: The 'cult-like' beauty businesses in your DMs

Faye Easter was 21 and looking after her three-month-old son when she got the Instagram message.

"Hey, I've been looking at your feed and I think you'd be perfect for this new business opportunity I have!"

With a baby, Faye wasn't sleeping much. "I didn't have a very clear head. I just thought I could make money out of it."

She signed up to sell beauty and health-related products for the multi-level marketing (MLM) company Arbonne and got her sister to join too.

Faye says she spent money buying products from the company but sold almost none of them.

"There was hardly any training on the products, it was all about how to recruit people and how to get people to join your team," she says.

And signing up her sister made her feel like "a predator stalking her prey".

"Afterwards I felt horrible because I just made her spend this money on absolutely nothing."

When Faye asked the person who recruited her if she could focus on selling instead of recruiting, she says she was shut down.

"She was like, 'no, we are selling products, but you need to get your team up and running to be able to sell together and get promoted'."

Faye says she "couldn't sleep" because of worry when she was part of the MLM

Faye says the "only time you were ever told to bother with the actual products" was if people higher up in the business needed to sell more products to get a promotion.

In which case, people like Faye were asked to buy them. Faye says she took out a high-interest loan to do so.

She got into debt quickly, and says she spent about £600 during her time at the company, and only made £12 back.

In hindsight, she feels like she was "preyed upon", and drawn into what she believes is "essentially a pyramid scheme".

Arbonne told the BBC it "upholds the highest standards of integrity" and doesn't condone "deceptive, unethical or illegal practices of any kind".

One of their sales people also contacted 22-year-old Charlotte Dickerson.

It was an old acquaintance of hers, who said she was looking for people to join her team and sell "vegan and cruelty-free makeup products".

Charlotte says she lost £800 in four months

Charlotte could see why she might be considered a good fit for the role. She was a vegan, she'd just graduated and was looking for work.

She didn't take much convincing to pay the £30 sign-up fee and buy £200 worth of products to get her started.

With money invested, Charlotte was keen to learn more about the makeup, and be trained on how to sell it.

But she says she lost £800 in four months.

Both Faye and Charlotte were told to attend a training conference. When they arrived, it wasn't what they expected.

"The best way I could describe that day is a cult meeting," Charlotte tells Newsbeat.

She remembers it as a series of speakers giving talks, with a lot of "hype and motivational phrases".

"They didn't have anything to do with the products. They were about how to cold-message people and how to recruit."

Charlotte says at one point everyone was told to get up and do a Mexican wave. Another time they were told to stand up and shout: "I'm going to earn a white Mercedes," she says.

"All the positive affirmations and manifestation they encourage is a way to put the blame on you," she tells us.

"If you start to notice you're not making any money, they say it's your fault. They say you're putting those thoughts in to the universe and the universe gives you back what you're thinking.

"It distracts people from the fact that they're losing hundreds of pounds."

What is an MLM?

It's important to note the difference between pyramid schemes and multi-level marketing schemes.

Pyramid schemes are businesses that recruit people whose job is to enrol others into the scheme, rather than selling a product or service.

The nature of the business model means a few people at the top end up earning money, and the large number at the "bottom of the pyramid" will make little to none.

They're illegal in the UK.

Multi-level marketing is a similar structure, but there is a product involved. The product can be anything. For Arbonne, it's mainly skincare and beauty goods.

Charlotte got cold feet after the training day. The white Mercedes felt far from her reality, and she'd only sold products to a handful of people, including family members.

At one point, she told the person who recruited her that she would prefer to focus on selling the products than firing out messages to recruit friends.

She says her superiors told her the most important thing was "the business opportunity" to hire more people.

"I felt very weird about recruiting anyone because I hadn't made a profit yet. It felt very wrong and immoral to tell someone else what an amazing business opportunity it was, when it hadn't been for me at all."

Faye is worried people struggling in the pandemic might have signed up to an MLM

With a lot of money coming out of their accounts, and barely any going in, it's hard to see why Charlotte and Faye stayed with it for as long as they did.

"There's so much fluffy, motivational talk," Charlotte says.

"They use very manipulative language, you know, making it sound like spending money on your boss is something that's going to benefit you too."

Faye says she's concerned people struggling in the pandemic might have been tempted to sign up to schemes like this.

What does Arbonne say?

The company told the BBC its consultants have to sign a "comprehensive business agreement" and adhere to a "strict internal code of ethics".

It added: "Our Business Ethics Standards Team conducts regular training sessions with Arbonne independent consultants, continuously monitors their business practices to ensure compliance with our policies, and takes immediate action if questionable activities arise.

"We invite anyone who feels they have had a negative experience to reach out to us directly so that we may investigate further and respond as necessary, including providing a refund to the individuals you referenced, if needed."

Jessica Mellor works at FM World, an MLM selling perfumes.

She says Faye and Charlotte shouldn't "tarnish all of the businesses with the same brush".

The 27-year-old tells Newsbeat that since lockdown, the number of people joining her team "has risen by 200%" but says recruiting isn't FM World's focus.

"You don't target people that have lost their jobs - you just put the opportunity out there," she says.

"You just give them the chance to make money."

Jessica says it's "literally ridiculous" how many people have joined her team since the pandemic began

She says it took her a few months of just selling the perfumes before she even started recruiting, and insists that it's not all about hiring people beneath you.

Her Instagram page regularly has posts telling followers they can earn thousands of pounds, be their own boss and "change [their] life" if they sign up through her.

Jessica's website says she has a team of 45,000 people, with some earning up to £70,000 a month.

People in her team earn "points" when they make sales, which go towards a group profit - shared with her.

"If I showed you my phone, there's messages people have sent me like, 'Jess you've changed my life'."

An 'anti-MLM' community

If Faye or Charlotte had done more research before joining, they would've quickly found a growing "anti-MLM" community online.

Faye says: "They told me not to look at criticism of these schemes online, because it's by bitter people who tried with the business and it didn't work for them."

Charlotte is one of those now in the anti-MLM online community.

Lots of anti-MLM content creators make videos speaking about the alleged "toxic positivity" culture in MLM companies.

Charlotte says it's what pushed her away from the business. When she left, she was glad to be free of the constant messaging in the company WhatsApp groups.

"No negativity is allowed in those group chats.

"They don't want anyone to say anything which could plant a seed of doubt, where other people will realise they're not the only ones having difficulty making money."

Jessica had a very different experience.

"There is nobody targeting you or telling you what you have to do," she says.

She points out she had no contract when she signed up to FM World. "It was free to join, if I didn't like it, it was free to leave."

She says her job has allowed her to buy her dream house, and for years it's meant she can treat her son to holidays.

We contacted FM World, but they didn't respond to us.

Jessica says for her, being in an MLM has been an "amazing opportunity"

Kia Commodore is a personal financial advisor. She says joining an MLM is a very risky financial decision, and usually only pays off for those few who make it to the top.

Kia says recruitment messages will often be "very vague in their wording".

"When these people message you, a lot of the time they won't tell you off the bat what the opportunity is.

"If someone has come to you and you're unsure whether it's legitimate, give it a simple Google. The main MLMs will come up and you'll see reviews, and you can make your decision from there."

Her main piece of advice is to "stop and be patient".

"If someone says 'sign up now', tell them you need to do your research first. That little delay could be the difference between you getting into debt and you saving yourself from losing money."

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