If someone tells you a business opportunity will pay you "$25,000 or more a week," and the company's own earnings document shows 79% of participants earned zero dollars - that is exactly the kind of gap the FTC exists to close.
On April 27, the agency announced it had taken action against Steven and Gina Merritt, senior-level recruiters in LifeWave, a company that sells health and wellness products through a multi-level marketing structure. The FTC alleged the Merritts used false and baseless income claims to recruit new participants - and that most of the people they recruited made nothing.
What They Said vs. What Actually Happened
The FTC's complaint quotes directly from a recruiting meeting the Merritts held in May 2025. Gina Merritt told the room: "We're going to make you a - can I say buttload - a buttload of money. I cannot wait to help you guys get to the top rank and make $25,000 or more a week."
Steven Merritt added: "The money keeps coming even if you don't show up, and you can't stop it. It's like a spigot of water but a spigot full of $100 bills throwing at you."
Here is what LifeWave's own income disclosure statement - published by the company itself - actually showed:
- 79% of active participants earned zero commission payments in 2024
- At most, 0.035% of active participants earned more than $25,000 per week
- That's roughly 1 in every 2,857 people in the program
The gap between "buttload of money, spigot of $100 bills" and "1 in 2,857 people reach that level" is not a fine-print problem. It is the core of the FTC's case.
What the Settlement Requires
The order settling the FTC's allegations prohibits the Merritts from making unsubstantiated income claims in any business venture going forward. Specifically, they cannot:
- Represent, directly or by implication, what participants are "likely" to earn
- Use images of homes, vehicles, or travel to imply income that is not typical
- Misrepresent what they themselves actually earned
- Misrepresent why most participants don't earn substantial money
If they make an income claim of any kind, they must be able to back it up in writing and provide evidence to anyone who asks. They are also required to notify their existing "downline" - people they recruited who recruited others - about the FTC's allegations and the order's restrictions.
This is the second FTC action against LifeWave participants. The first came in November 2024. The pattern suggests the agency is moving through the company's top earners systematically.
Why This Matters If You Run a Small Business
MLM schemes regularly target small business owners and self-employed workers - people looking for supplemental income, people who have already demonstrated an entrepreneurial mindset, and people who are used to operating outside a traditional employment structure.
The pitch is usually designed to sound like a business opportunity rather than a sales job. You are "building a team," "creating residual income," "becoming your own boss." The income claims are the hook.
Here is a simple gut check before signing up for anything structured this way:
Ask for the income disclosure statement. Legitimate MLM companies are required to publish them. The document will show, broken down by rank or participation level, what participants actually earned in the prior year. If the median earnings at the level they're recruiting you for are close to zero, that is the expected outcome for most people who join.
"Residual income" is real, but it is rare at this scale. The structure of MLMs means the people who earn significant residual income are almost always the ones who joined early and built large downlines. By the time you're being recruited, the math for most new participants is already working against them.
The FTC has a page specifically for evaluating MLM opportunities. It is at consumer.ftc.gov/articles/multilevel-marketing and it asks the right questions.
The Bottom Line
A couple earned a living telling people they could earn $25,000 a week from a wellness MLM. The company's own records showed 79% of people in the program made nothing. The FTC drew a line.
Income claims have to match income reality. That rule applies to recruiting pitches, social media ads, YouTube videos, and stage presentations. If someone is making a specific money promise and cannot back it up, the FTC wants to hear about it.