COC Trustee Candidate Once Promoted AdvoCare, a ‘Pyramid Scheme’ According to FTC
 

By Santa Clarita Star Staff

 

Scott Schauer, a candidate for the Santa Clarita Community College District Board of Trustees, was previously involved with AdvoCare, a dietary supplement company labeled a “pyramid scheme” by the Federal Trade Commission. Schauer actively promoted AdvoCare through his Soccer Center and social media, despite FTC allegations that the company misled consumers with exaggerated income claims and recruitment incentives.

 

September 28, 2024 - Scott Schauer, a candidate for the Santa Clarita Community College District Board of Trustees in Area 2, was once involved in what the Federal
Trade Commission determined was a pyramid scheme that claimed to produce thousands of dollars for those in the network. Schauer is running against COC Board president Dr. Edel Alonso on the November ballot.
Shauer used the Santa Clarita Valley Soccer Center to promote his participation in AdvoCare, a dietary supplement company that the FTC proved in court made false claims about the amount of money participants earned. Some in the company made no money.

Shauer posted on his Facebook page last year an invitation to visit the Soccer Center to
learn more about his association with AdvoCare.
“ONLY 5 MORE DAYS!!” declared a Facebook page called AdvoCare SCV Soccer. “Join us on October 2 nd and 3 rd and see what all the excitement is about!”
Schauer, who owned and operated the Santa Clarita Soccer Center, served as an independent distributor and promoter for the company. In a video posted on YouTube,
he enthusiastically extolled the benefits of becoming an AdvoCare distributor and celebrated achieving the “Ruby Level” within the company’s compensation structure,
which claimed average annual incomes for participants of over $81,000. Schauer also outlined his ambition to attain the “Diamond Level” within 360 days, a status associated
with an average annual income of $648,879.

If that type of one-year growth sounds too good to be true, the FTC agrees. The agency alleges that the vast majority of AdvoCare distributors either earned no money or lost money. As CBS News reported, over 90% of U.S. participants earned less than $250 a year, and the majority earned nothing. In an FTC press release, they alleged that AdvoCare “falsely claimed to offer a life-changing financial solution that would allow any
ordinary person to earn unlimited income, attain financial freedom, and quit their regular
job.”

On October 2, 2019, the FTC declared that AdvoCare was a “pyramid scheme” and announced a lawsuit against the company, seeking to return millions of dollars to consumers, and ban the company from all future multi-level marketing. Seena Gressin, Attorney for the FTC, wrote on the FTC’s blog that “people paid AdvoCare thousands of dollars to become ‘distributors,’ buy inventory, and become eligible for cash bonuses and other rewards. But, the FTC says, AdvoCare rewarded distributors not for selling products but for recruiting other distributors to spend large sums of money pursuing the business opportunity. That push to recruit is a classic sign of a pyramid scheme.”

 

The FTC’s lawsuit was successful. On May 5, 2022, the FTC announced that it would be returning more than $149 million to individuals who lost money as a result of the
AdvoCare pyramid scheme. The multi-level marketing company, based in Texas, was accused of deceiving consumers into believing they could earn substantial income from its health and wellness products.

 

The FTC's lawsuit against AdvoCare, its former CEO, and top promoters alleged that the company had operated an illegal pyramid scheme. The defendants were accused of
making false and misleading claims about the financial opportunities offered by AdvoCare, promising unlimited income and financial freedom to ordinary people.
However, the FTC found that the vast majority of AdvoCare distributors either earned no money or lost money.

 

 

The agency determined that AdvoCare's compensation structure incentivized distributors to recruit new distributors rather than sell products to customers. This pyramid scheme led to many distributors purchasing large quantities of AdvoCare products they could not sell. To recruit people, AdvoCare and its promoters made exaggerated claims about potential earnings and used emotional tactics to instill fear in potential recruits. The FTC distributed payments to more than 224,000 consumers who lost money to the AdvoCare pyramid scheme.

 

 

While the scope of Schauer’s recruitment efforts and financial returns from his network of downline distributors is not fully known, his public presence indicates significant
involvement in promoting the venture across the Santa Clarita Valley. During this time, Schauer was a visible advocate for AdvoCare, using both print and social media,
including Facebook, to endorse the company’s products. He also leveraged his Soccer Center as a prominent advertising venue, displaying AdvoCare banners and promotional materials throughout the facility. Schauer credited the products with his own weight loss and increased energy, often praising their purported health benefits.

 

 

“I have not been involved with AdvoCare for years,” Schauer told the Santa Clarita Star. “I understand their structure has changed, and I am now retired and no longer affiliated with any multi-level marketing company.”

 

 

The Santa Clarita Star contacted several individuals who were affiliated with AdvoCare alongside Schauer, but none responded to requests for comment. Alonso, the current member of the College of the Canyons Board of Trustees, against whom Schauer is running, was also approached for a statement. Her campaign replied, “No comment.”