119 multilevel marketing firms operating in Q3; regulator warns of illegal schemes disguised as crypto analysis services

Two multilevel marketing companies newly registered and two others shut down in the third quarter of this year. The Korea Fair Trade Commission is urging consumers to be wary of illegal multilevel marketing schemes that use cryptocurrency analysis services as a lure to recruit new members.

The Fair Trade Commission released its "Third-Quarter 2026 Key Information Changes for Multilevel Marketing Businesses" on Wednesday.

As of the end of September, 119 companies were registered as multilevel marketing businesses. During the third quarter, eight changes were recorded in total — two new registrations, two closures and four name or address changes.

Altovita and Rodem Korea newly registered after signing mutual aid contracts with the Direct Selling Mutual Aid Cooperative and the Korea Special Sales Mutual Aid Cooperative, respectively. The two companies that closed were Celeb Korea and Footing Korea. No companies filed for suspension of business during the quarter, and none had their registrations revoked or canceled.

However, Ace One Global, based in Gyeonggi Province, terminated its mutual aid contract with the Direct Selling Mutual Aid Cooperative during the third quarter but has not yet filed for suspension or closure of business.

The Fair Trade Commission said multilevel marketing companies whose consumer damage compensation insurance — including mutual aid contracts or debt payment guarantee contracts — has been terminated cannot operate normally even before filing for closure, and urged consumers to exercise particular caution when dealing with such firms.

Four companies changed their names or addresses: Karis, Unexa Korea, LR Health & Beauty and Amare Korea. The commission found that no company had changed its name or address five or more times over the past three years.

The commission said consumers must verify key information — including whether a company is registered and whether it has suspended or ceased operations — before doing business with a multilevel marketing firm or signing on as a sales representative. It added that companies that frequently change their names or business addresses pose a heightened risk of unexpected harm, such as difficulty obtaining refunds, and that consumers should proceed with caution.

The commission also warned of the potential for illegal multilevel marketing schemes operating under the guise of cryptocurrency analysis services. Inducing consumers to sign service agreements and then requiring them to recruit new members in exchange for commissions may constitute illegal multilevel marketing, it said.

One such case was highlighted: a consumer who signed a cryptocurrency analysis service agreement and paid 14.05 million won ($10,600) requested cancellation and a refund, citing unreasonable demands to recruit new members and inaccurate investment information, but the company refused.

The commission said demanding excessive membership fees or paying financial incentives solely for recruiting lower-tier sales representatives may violate the Door-to-Door Sales Act.

The commission also advised consumers to obtain and keep a mutual aid number notice when purchasing products from multilevel marketing companies, as it can be used to file a compensation claim with the relevant mutual aid cooperative if a company refuses a refund. It recommended that anyone who suspects illegal multilevel marketing activity decline to join, secure relevant evidence and report the case to the authorities.