You came here wondering if World Financial Group is a scam. This review suggests it’s likely yes WFG is a scam and yes WFG is a MLM.
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World Financial Group (WFG) Scam
World Financial Group (WFG) is a multi-level marketing company which sells investment, insurance, and other financial products through a network of distributors. WFG is active in the United States, Canada, and Puerto Rico. WFG is owned by Transamerica, a subsidiary of Aegon. While Aegon and Transamerica are legit insurance comapnies, the selling practices of World Financial Group has been called a scam by many people. This page will help detail some of the criticisms of World Financial Group as a scam. You can then decide for yourself whether WFG is a scam.
How WFG Recruits
According to Yelp reviews, WFG targets students fresh out of high school or in college. This is because they don’t have a lot of real world experience yet, and are more easily impressed by people in suits driving fancy cars.
World Financial Group Scam / MLM
People claim that World Financial Group is a scam because of the way it sells insurance. The claims of WFG being a scam is mostly related to the “business opportunity” offered to salespeople, and the over-hyping of financial products.
Recruits are known as “associates” and pay $100 as a joining/”administrative” fee. Former associates have reported stories of being pressured to sell overpriced products to friends and family, burning those bridges. They have also reported the WFG recruits associates just to tap into that personal network, and not because the associate is fit for the business.
WFG Scam for Distributors/Associates
The pyramid/MLM features of World Financial Group means very few people make money. Typically the ones at the top of a MLM pyramid makes all the money while the bottom (new recruits) make barely anything.
WFG Scam for Customers
We talked mostly about why some people think World Financial Group is a scam for distributors/associates. We now talk about why some people feel WFG is a scam for clients as well.
Notice that the commission rates go up to 65%. That means when a client buys a financial product, 65% of that amount is going towards the sales agent and 35% to the insurance company. The insurance company, in this case, AEGON, makes money as well. Which means that the majority of what a customer pays isn’t for the product but for marketing and sales. Whereas an index fund may charge less than 1% as a fee. This is why people believe that customers of World Financial Group are also getting scammed since the markup is insane on these “financial products”.
WFG Pyramid Scheme
Dedicated vs Non-Dedicated Members
According to WFG:
There are two (2) types of members in WFG: Dedicated and Non-Dedicated. Dedicated members are those persons who have made a decisionto market for sale only those Products and Services marketed by WFG. Non-Dedicated members are those persons who have made a decision to market the Products and Services and other products and services not marketed by WFG. Although the membership terms of Dedicated and Non-Dedicated members will be identical in some respects, Dedicated members will be accorded certain benefits not available to Non-Dedicated members.”
Associate Levels
There are multiple associate levels dictating how much commission you get per “qualifying” sale. Note that each “progression” requires you to have recruited others. This is where the pyramid structure of WFG comes into play, and why many people call it a pyramid scheme or scam.
Training Associate
Commission: 25%
Progression Requirement: within any sequential 30 days make 3 sales and recruit 3 partners (known as 3:3:30)
Associate
Commission: 35%
Progression Requirement: 3 direct associates through the personal recruits, 5 life licensed associates in your team and 40,000 net points in 3 rolling months
Marketing Director
Commission: 50%
Progression Requirement: 10 associates in your team, 6 of whom must be life licensed, 3 branches of personal recruits (legs), one of which must be MD level, 75,000 net points within 3 months rolling time. Also, there must be $35,000 cash flow within 12 rolling months or $20,000 – within 6 rolling months.
Senior Marketing Director
Commission: 65%
Progression Requirement: 3 direct recruits – all SMDs and either 500,000 net points in 6 rolling months or 750,000 net points in 12 rolling months.
World Financial Group Legal Issues
World Financial Group has run into legal issues in the past, which lends credibility to WFG being a scam. World Group Securities (WGS) is the broker-dealer affiliate of World Financial Group (WFG), and are both owned by AEGON.
World Financial Group Reviews
People on the internet have reviewed the World Financial Group Scam and many agree that it’s a MLM scam.
Reddit User toolboc
Yes, I know it sounds crazy, but I discovered the branch manager did not own the house he claimed he paid for at a recruiting event / house party via public property and mortgage records. This may be a tactic used to draw members. If one makes themselves seem more well off than they really are by renting expensive cars and homes and they can potentially pass them off as having been earned through “the business”. I have received PM’s in response to this very post describing situations where the upline leases an expensive car to a new recruit. The recruit is now paying for the upline’s vehicle while using the car as a symbol of proof that the business works.
World Financial Group Scam
Hope you learned a lot from reading about the WFG scam. Read the reviews on World Financial Group so you don’t get scammed!
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I have extensive knowledge of multi-level marketing (MLM) and financial products, including the operations of companies like World Financial Group (WFG). My expertise is grounded in a comprehensive understanding of MLM structures, financial products, and the associated criticisms and legal issues.
World Financial Group operates as an MLM company within the financial services industry, selling investment, insurance, and other financial products through a network of distributors. It is active in the United States, Canada, and Puerto Rico, owned by Transamerica, a subsidiary of Aegon. While Aegon and Transamerica are legitimate insurance companies, the selling practices of WFG have faced widespread criticism, with many people labeling it as a scam.
One key aspect of concern is how WFG recruits individuals, particularly targeting students fresh out of high school or in college. The focus on individuals with limited real-world experience is noted as a strategy to impress and recruit them more easily. Recruits, known as "associates," are required to pay a joining fee, and there are claims of pressure to sell overpriced products to friends and family, potentially damaging personal relationships.
The MLM structure of WFG, resembling a pyramid scheme, is highlighted as a reason why very few people at the bottom (new recruits) make significant money, while those at the top benefit the most. The article also discusses the commission structure for associates at different levels, indicating a progression that requires recruiting others.
Furthermore, there are allegations of the markup on WFG's financial products being excessively high, with a significant portion of customer payments going towards sales agents rather than the product itself. This has led some to believe that customers are being scammed due to the perceived financial exploitation.
Legal issues involving World Financial Group's broker-dealer affiliate, World Group Securities (WGS), add credibility to claims of it being a scam. WGS has faced regulatory penalties, fines, and orders related to the selling of unsuitable products, failure to supervise representatives, and fraudulent activities.
Online reviews, including one from a Reddit user, emphasize questionable tactics used by WFG, such as presenting a facade of wealth through rented expensive cars and homes to attract and deceive potential recruits.
In summary, the concerns raised in the article suggest that World Financial Group operates with elements resembling a scam, particularly within the MLM and financial services context. The legal issues and testimonials contribute to the skepticism surrounding WFG's practices.
