Is Monat a scam? In this post, we analyze Monat as an investment option to see if it is worth your dollars and hours.
Monat advertises across all social media platforms. You are probably considering its offers, which keep coming your way.
Let us start by answering some critical questions about this company.
Is Monat A Scam?
Monat Global Corp has not been declared a scam by any American courts or other local authorities. However, Monat has come under several class lawsuits accusing it of being a pyramid scheme. Florida courts joint the cases, and proceedings are ongoing.
In law, pyramid schemes are illegal.
Statistically, people who join this MLM lose their friends and become poor. While Monat is not a scam, it is based on weak products that negatively impact its clientele.
Thus, its focus is anchored more on recruiting distributors than distributing its products. People also consider it a scam because distributors pay a fee to join the company’s products.
Is Monat a Pyramid Scheme?
Monat claims that it is not a pyramid scheme and asserts it is a multi-level marketing (MLM) company. Pyramid schemes and MLMs are very similar.
However, MLMs sell actual products instead of unsustainable business opportunities. Pyramid schemes do not sell products; they sell get-rich-quick scams.
Monat is legally registered in the United States, Canada, and the United Kingdom as a multi-level marketing company. It uses network marketing to drive direct sales for its haircare and skincare products. However, it is facing a joint class lawsuit accusing it of running as a pyramid scheme.
The main difference is that MLMs focus on selling products, while pyramid schemes focus on recruiting investors. MLMs are sustainable so long as they sell viable products.
Monat uses social networking and direct sales via its multi-level networking of independent networkers.
Is Monat Bad for Your Skin?
Monat issued a statement claiming it was approaching a billion dollars in sales. It also claimed it had over two million happy customers. The MLM company also claimed it spends heavily on quality assurance.
However, numerous customers and former independent contractors accuse Monat products of severe defects.
Monat maintains its products are safe and beneficial for users’ skin and hair. It engages multiple third-party labs to check the safety of its skincare products. But, 11 lawsuits and more than 300 adverse event complaints suggest Monat causes hair loss, irritation, and scalp lesions.
How Do You Tell When An Earning Opportunity Is A Scam?
In business, you need to offer value to get paid. Your business is morally wanting and possibly illegal when you earn while providing zero value.
People expect to have problems solved for every cent they spend. Be discerning when you pick businesses from which to participate.
You can tell if an earning opportunity is a scam or not by evaluating its value proposition. Businesses make money by solving problems that are unsolved within particular market gaps.
Thus, they will demand skills and diligence from distributors.
Business prospects that promise easy money end up taking your money and causing you trouble. Viable businesses take time and money to distribute solutions.
Legit companies also do not demand monetary investments from their recruits. They focus on their products, not earning from recruitment.
It is not enough to check if a company is legally registered to tell if it is a scam. The most brilliantly executed scams go through the registration process to pretend they are legal businesses.
Scams exploit legal loopholes; For example, pyramid schemes front as legally registered MLMs.
Ask Yourself What Sounds Off in the Case of Monat’s Social Media Outreach
MLM entry-level recruiters will convince you that they found a perfect earning opportunity that lets them earn passively. They will convince you that you are an ideal fit for the company, even when they barely know you.
They do not look as financially secure as they try to make it seem. Worst of all, they will ask you to pay for the chance to work at their companies.
They do it to recover the money they spent joining the same company. If you enter the company, you are likely to keep pressuring your family and friends to join the same MLM.
Before joining Monat, ask yourself the following questions:
- Legit companies ask for resumes and conduct rigorous interviews to determine their fits. How did the MLM know you can deliver?
- Why are you paying $300 for an employment opportunity?
- What does 90% of the Monat staff earn annually?
The main priority of a legit MLM company should be producing products that please its consumers. Is this the case with Monat?
The History of Complaints about Monat’s Defective Products
Complaints regarding defective products from Monat started in 2015, barely year a year after it got into the skincare market. The complaints accuse the company of selling expensive products, resulting in balding, itching, and skin lesions.
The corporation fronts as a supplier of modern and natural skin care products, and it claims to deal with premium quality. However, the company has come under intense criticism for misleading adverts about its products.
If at all its products are safe, then they are not safe for all skin types. However, the company claims its products are a fit for all skin types.
In 2015, consumers and distributers complained the company conducts misleading advertisements to:
- The Better Business Bureau
- U.S. Food and Drug Administration
According to complaints, Monat reps misled consumers when confronted with complaints about hair loss. They encouraged them to continue using the products and lied that the hair was undergoing detoxification.
Ultimately, this misleading professional advice led the consumers to develop skin sensitivity and painful sores. It is a fact that hair loss is never part of any safe hair detoxification.
Between 2016 and 2018, the company kept going viral for causing balding, itching, and skin lesions. Still, the company kept advertising that:
- Its products are naturally-based
- Its products are safe
Monat was facing hundreds of complaints by 2018. The complaints touched on serious issues such as:
- Deceitful practices
- Hair loss
- Lack of integrity
- Skin and scalp irritation
In 2018, Monat sued Vickie Harrington and accused her of defamation. She had complained about its defective products.
By 2021, the complaints about Monat rose to more than 1,030 since 2018.
Skin Care Products Prepared, Parked, and Stored Insanitary Conditions
In 2018, the FDA became concerned about the growing number of complaints regarding Monat. The agency sent inspectors to evaluate the production of skin care and hair care products.
Its findings contradicted what Monat advertises about its products.
Monat asserts that its products are pure and natural. But, the FDA assessment found that the products are exposed to toxic contamination during preparation, parking, and storage.
The products are produced in unsanitary conditions, and it is simply inaccurate to claim such products are pure.
In 2020, Florida’s attorney general summoned Monat’s leadership. Monat signed an agreement pledging to refrain from misleading marketing. The agreement also had Monat refunding $82,782 to affected customers.
Monat’s U.S. 2018 Income Disclosure: How Much Can You Make with Monat?
Monat is a typical MLM. The defects involved with its products even suggest that Monat is a pyramid scheme circumventing legal loopholes.
Just like typical MLMs, this company 99.89% of its reps into earning below the poverty line.
On average, Monat reps make $183 annually.
Indeed, one out of 909 people at Monat earns less than $40,000. It’s commonplace to consider a company to be a scam when most investors can’t make profits.
Monat reps are investors and not staff because:
- They pay a signup fee of $49.
- They must purchase a starter kit of $99.
Worst of all, the starter kit only contains samples, brochures, and more irrelevant paraphernalia. None of the components are valuable products.
Thus, investors have to dig deeper into their pockets for the cheapest pack of products.
From a Ponzi-Scheme to a Controversial MLM
The president of Monat Global Corp is Stuart A. MacMillan, which makes matters even worse. Mr. Stuart A. MacMillan is the former CEO of TelexFree, which was accused of running a three-billion-dollar Ponzi scheme.
TelexFree caused many people to lose their money and got shut down after unsuccessfully filing for bankruptcy.
Interestingly, Monat hired such a man to handle its declining reputation. The man was behind massive losses of people’s investments at TelexFree.
So, is Monat a scam?
We will not accuse Monat of being a scam company. However, its business model has the makings of a scam. Moreover, its income disclosure also shows little to be desired about their ‘novel’ opportunities.
We only recommend viable opportunities that can make you money. We are always looking for ventures that will be worth your time and money.
When we come around hypes, we probe them to find pros and cons. Monat does not make the list of excellent opportunities that I recommend.
Related: Is Selling Feet Pictures Legal?
In fact, this is not a pyramid scheme, but a financial company. This is not dangerous, as it works on the principle of increasing direct sales of hair and skin care products.
A Monat business model refers to the multi-level marketing (MLM) strategy used by Monat Global, a company that sells hair and skincare products. The model involves recruiting independent sales representatives, who then earn commissions on their own sales and the sales of those they recruit.