BGA: Chicago pols push controversial sales program 5Linx

For more than a year and a half, state Sen. Patricia Van Pelt (D-Chicago) recruited people into a home-based sales organization that she called “the opportunity of a lifetime.”

Other local politicians, including Cook County Circuit Court Clerk Dorothy Brown and Illinois Secretary of State Jesse White, also have belonged to the company, 5Linx. But Van Pelt was one of the most visible company cheerleaders, seen on one promotional video for 5Linx boasting of her BMW and Bentley. She joined the company after she heard about a “million-dollar earner” with 5Linx, she says on the video.

By recruiting scores of people who also recruited others into 5Linx, both Van Pelt and Brown rose to high levels in the company’s organization. It’s a controversial pitch, especially from public officials who wield influence, because critics of these types of sales organizations — so-called multilevel marketing firms — say a vast majority of people who pay to join end up failing. In multilevel marketing, people pay to become sales representatives and then move up in the company by recruiting more people also to sell products. Critics say the problem with these organizations is that very few people actually make money.

“You are not permitted to make people think you are going to be rich with a company if the fact of the matter is 85 percent or more of people involved will not be successful,” said Bonnie Patten, executive director of the advocacy organization Truth In Advertising. Patten’s non-profit organization has helped the Federal Trade Commission investigate multilevel marketing companies that made such claims, but 5Linx is not among them.

A spokesman for 5Linx says the company’s representatives are advised not to make claims about potential income.

In an interview with the Better Government Association, Van Pelt downplayed the wealth opportunities of 5Linx. Asked if many people make money after joining the company, she said: “I don’t have the slightest idea.”

Rochester, N.Y.-based 5Linx recorded sales of $109 million in 2014, the company said. The company representatives sell such services as satellite TV packages and products, including coffee and diet supplements. Sales representatives are independent contractors, mostly working from home. There are about 1,100 representatives in Illinois, roughly half from Chicago, the company says.

“Anybody can get into this business and they can find their way to financial freedom,” Van Pelt said in the promotional video posted earlier this year.

In the video, titled “Senator Patricia Van Pelt’s 5Linx Platinum Lifestyle,” she blurs the line between her public office (a part-time job) and her sales position. Twice on the video Van Pelt’s name, title and the seal of the State of Illinois are featured prominently.

Despite the rhetoric in videos from Van Pelt about the wealth potential of 5Linx, she told the BGA that saving money on services is the benefit most people realize after joining.

Van Pelt rose to platinum senior vice president — one of the highest rankings in the 5Linx organization. But she quit 5Linx in June and joined a similar company, Utah-based Ariix international because, she said, she liked that company’s products. Ariix contributed $10,800 to Van Pelt’s political committee in September.

The majority of 5Linx members are African-American and include ministers and others with many acquaintances who are potential recruits.

As the BGA previously reported, Brown is being investigated by federal authorities for possible corruption, including whether she exchanged jobs and promotions for money.

The BGA also has reported that Brown asked some of her own government employees to join 5Linx, an accusation she’s denied. One of her employees was recently charged in federal court with lying to a grand jury on another matter.

Brown could not be reached for comment but has she insisted she did nothing wrong.

Last spring, Brown was named a senior vice president of 5Linx.

In a video posted in October, Brown tells a cheering audience that 5Linx can help anyone become prosperous: “I’m an attorney, a CPA and an MBA but, ladies and gentlemen, I joined 5Linx to be financially free.”

Van Pelt recruited a political ally, White, to 5Linx. White’s spokesman says he wasn’t interested in being an active member after paying $249 to join the company.

“He saw no advantage to remaining with 5Linx, was not impressed with the products and would not recommend individuals join,” the spokesman said.

This column was written and reported by the Better Government Association’s Brett Chase, who can be reached at bchase@bettergov.org. The BGA’s Andrew Schroedter contributed to this report.