LuLaRoe/Youtube. LuLaRoe’s pyramid structure Multi-level marketer LuLaRoe just settled a major pyramid scheme lawsuit. Is LuLaRoe a Pyramid Scheme? Misleading claims about income potential is a hallmark of a pyramid scheme. At the end of this article, you can judge for yourself if LulaRoe is a pyramid scheme or legit company. LuLaRoe founder DeAnne Brady Stidham. When I started my fashion consultant business, To become a LuLaRoe consultant, I was required to purchase one of the three LuLaRoe startup packages, which range from $4,812 to $6,784. But experts say that the settlement doesn't go far enough. The embattled multilevel marketing company LuLaRoe has agreed to pay $4.75 million to settle a lawsuit filed by the state of Washington, which accused the company of engaging in a pyramid scheme.. The company is accused of being an illegal pyramid scheme and of violating a federal racketeering law that has been used to … “LuLaRoe tricked Washingtonians into buying into its pyramid scheme with deceptive claims and false promises,” Ferguson said. I will also review the compensation plan of the company and the lawsuits that were filed against them. “LuLaRoe tricked consumers into buying into its pyramid scheme with deceptive claims of high profits and refunds for unsold merchandise” – General Bob Ferguson (State Attorney General’s Office, 2019) As part of its settlement with the state of Washington, Experts say LuLaRoe gets $4.75 million slap on the wrist, as company eludes admission of any wrong doing - Selfboss24 The California-based multi-level marketing business LuLaRoe is paying $4.75 million to settle allegations from the Washington state Attorney General's Office that it's a pyramid scheme. In this article, I will discuss how LulaRoe started and the products that they offer. Multi-level marketer LuLaRoe just settled a major pyramid scheme lawsuit. Ferguson asserted that LuLaRoe’s profitability claims were unfair and deceptive, violating the Consumer Protection Act. I should have known… this LuLaRoe is a pyramid scheme, a scam! The Washington state attorney general has filed a lawsuit against the California-based clothing company LuLaRoe contending the business is a pyramid scheme. LuLaRoe, however, did not live up to those expectations, resulting in a “big loss” for her and her family. First of all, let's look at what a Pyramid Scheme is: "A pyramid scheme is a business model that recruits members via a promise of payments or services for enrolling others into the scheme, rather than supplying investments or sale of products." Although LulaRoe is still operating (and accepting new consultants), the lawsuit alleges that the company is actually a pyramid scheme. 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