I have had more than one "home grown" MLM type company rip me off. They were both bath and body type companies. It wasn't the type of scam you are talking about, but I ordered products and then never received them. Now I only do business with companies with a good reputation and longevity.
Thanks for sharing this Sara. If a business is lacking a very important pillar "Management experience with integrity" they will have no problem with ripping you off.