Network marketing responsible for 20% of the world's millionaires?

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On his website totalwellnessnetwork.com, Dr. Ladd McNamara extols the benefits of network marketing: "20% of all millionaires in the world made their fortune through the Network Marketing system," he writes.

But if 20% of the world's millionaires got that way through multi-level marketing, they also apparently go that way through tax evasion. In a paper titled Who Profits from Multi-Level Marketing? Prepares of Utah Tax Returns Have the Answer, Consumer Awareness Institute President Dr. Jon M. Taylor wrote about his interviews with tax preparers about multi-level marketing:

A manager of H&R Block in northern Utah, told me that during his 25 years of doing over 12,000 tax returns a year between he and his group, they could not remember a single client who had reported a significant profit over any appreciable period of time in MLM! ... And a tax software developer, who dealt with thousands of tax preparers across the country, said he had asked about 100 of them if they had ever seen a profit reported from MLM participation. None had. This was out of a total of over a million tax returns ...



He goes on to suggest that his investigation demonstrated that the only people making money in multi-level marketing seem to be those who live in cities where the companies are headquartered: founders, executives and others who got into the system early.

Dr. McNamara gives no citation for the 20% figure and while I can find plenty of similar claims on other recruiting websites, I can't find any reference to any study of any kind demonstrating the methodology behind that figure! Where does it come from? I have no idea. Even network marketing guru John Milton Fogg says the claim is bogus: "Twenty percent of all the millionaires in America were not created through network marketing. By most accounts, as many as 90 percent of them were created through real estate, 90 plus 20 equals 110, and that kind of math would get an F in any school ..."

Oh, another quick thing about Dr. McNamara: Back in May of 2007, the Fraud Discovery Institute reported that his medical license was revoked in Ohio for "fraud, deception and misrepresentation."
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