Kangen Water Exposed: Pyramid Scheme that Pays?

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In the last few years, I’ve encountered a very dubious business model that has lured thousands upon thousands of people, mainly from the Philippine community, and enriched a very few…

The promoted “online business” has only one purpose: to attract as many distributors as possible for the equally dubious Kangen Water (the brand name for alkaline water owned by Enagic Corporation), which operates as an MLM/pyramid scheme.

In Canada, according to Section 55.1 of the Competition Act, A PYRAMID BUSINESS is a multi-level marketing plan that includes either compensation for recruitment, required purchases as a condition of participation, inventory loading, or the lack of a buy-back guarantee on reasonable commercial terms, constitutes a prohibited “scheme of pyramid selling.” Please read here for the Examples.

Kangen Water/Enagic Canada (Address: 7460 Edmonds St Suite 101, Burnaby, BC V3N 1B2) falls into the pyramid category (scheme in disguise).

The big question is: WHY IS KANGEN WATER BEING ALLOWED TO OPERATE IN CANADA?

What is Kangen Water?

Kangen water® is the brand name for alkaline water owned by Enagic Corporation (read BBB complains about the company here). It is sold through multi-level marketing. The multi-level marketing system used by Enagic® to sell its water ionizer has also been called a scam because it doubles the price of the kangen water® machine.

You can buy a Kangen Water machine through a distributor. Even on their website, they ask for a “sponsor’s ID, name, phone number, and email address” (distributor) to buy a machine.

Every time a Kangen machine is sold, eight salespeople—the Kangen Water pyramid—get paid a commission. Their commission doubles the cost of the Kangen machine. Replacement filters for the Kangen® machines are expensive because they are also sold through the MLM scheme. The same eight people get paid every time you buy a replacement filter for your machine. It’s an outrageous scam!

Eight salespeople—the Kangen Water pyramid—are paid a commission every time a Kangen machine is sold.

The top people (the so-called 6A2–8) in the pyramid scheme get a $800,000 bonus and a $80,000 Monthly For Life (which, you’re told, can be inherited by your next of kin when you die… not precisely true, but hey — fairy tales work when you’re selling the dream)!

Do you know any other business that does that?

We’re talking about SERIOUS MONEY that the scammers at the top will get monthly, guaranteed… if they continue to supply Enagic with distributors. They collect money from sales of those OVERPRICED, NO-GOOD WATER MACHINES to other distributors.

No wonder they get so upset when they are exposed…

To recap, you can’t become a Kangen Water distributor without buying a Kangen Water machine from another distributor.

The Kangen Water machines are hugely overpriced to pass down-the-line commissions from sales.

This creates the perfect opportunity for the perfect pyramid business scam.

I did my “investigation” — I went to Enagic Canada’s main office in Burnaby, BC (7460 Edmonds St Suite 101, Burnaby, BC V3N 1B2) to inquire how to become a distributor. I was told the requirement is to purchase a Kangen machine from another distributor. “Just be sure it’s an honest one; there are a lot of dishonest people out there.”, said the guy behind the counter. “No sh*t!” I thought to myself.

Purchasing a product is never a condition of becoming a distributor. In any other business, you apply to become a distributor, and you purchase inventory only if/when you are approved.

Enagic sells its overpriced alkalized water machines, which make “antioxidant-rich, healthy water for revitalized cells” (quote from one of their sites). These machines will do miracles for your health, and “everyone will tell you so,”… although the company “prohibits” its distributors from making such claims. Wink, wink.

Some of the “claimed” health benefits from distributors (who mostly know nothing about any of this science) include:

• Slows aging process
• Boost immune system
• More hydrating
• Boost metabolism
• Relieves heartburn
• Cures cancer, diabetes, measles
• and a ton of other stuff

In multi-level marketing scams, the parent company keeps a low profile and makes few claims that would attract the scrutiny of regulators such as the U.S. FTC. Instead, it recruits thousands of “independent agents” with sales literature containing false and misleading claims, which they then transmit to their customers or post on their websites.

Few of these agents are well enough educated to evaluate these claims or realize that they violate the FTC rules on deceptive advertising. As a result, these agents are as victims as their consumer customers.

“Snake oil” is a term used to describe deceptive marketing, health care fraud, or a scam, which clearly Enagic is. Their water machines have no health benefits and are overpriced only because of the MLM system for distributing commissions.

So here is what we know about Kangen Water

1. It has NO PROVEN HEALTH benefits — and because Kangen water is sold through a network of distributors, the company can easily deny any wrongdoing when the individual distributors make such claims.
2. The Kangen Water cost thousands of dollars — between $2,980.00 and $5,980.00 for their most expensive model. The inflated price has one purpose — to provide large commissions to the few successful distributors.
3. Kangen Water is sold through a multi-level marketing pyramid scheme. To become a Kangen distributor, you must purchase a machine from another distributor, which clearly violates Section 55.1 of the Competition Act.
4. The company has been sued for making spam calls to more than a million people in the US.
5. The Health Ministry in Malaysia has taken steps against the sale and promotion of Kangen water.

Finally, the very existence of Kangen Water/Enagic in Canada allows for additional scams, like the one described below.

The Local Scam

Did you know that you can easily make a six-figure passive income with virtually no experience, skills, or education? You may also receive, guaranteed, a passive $5,000–$80,000 monthly “lifetime legacy bonus, which can also be bequeathed or willed to your next of kin or your children.”

Sounds too good to be true?

This is, of course, if you join Mike Dreher and Darren Ewert online “business system”.

Or should I repeat: scam.

This information is from Enagic’s own Earnings Disclosure statement (as a distributor, you start at 1A — the more sales you have, the more additional distributors you get in the pyramid structure, the higher you climb and the bigger the commissions get. Only 0.24% hold a rank of 6A2–3.):

We don’t know what rank do Darren and Mike hold right now, but it’s above 6A2–4.

The scamming duo, Kangen Water/Enagic Canada’s main office, and the majority of the “Dream team” are all located in Vancouver, British Columbia. However, there are many other victims of the scam from around the world.

The Dream Team Or The Nightmare Mike And Darren’s Business is a firsthand account of someone who bought into the scam.

How does the scam work? Let me explain as easy as I can:

1. If you’re on Facebook (who isn’t?), you may come upon an ad or a post where you see ordinary people showing how much money they’re making from their “online business”. “Join our webinar, and you’ll learn how you can do it too!”, they say.
2. You go to their website, fill in your email, and watch a pre-recorded “webinar.” If you want to join, please pay $149 (US).
3. After you pay, you join the “Dream Team,” a hidden Facebook community group, and you learn that the “business model” is actually to become a distributor of Enagic products.

This is an online scam designed to trick people into becoming Enagic distributors. Mike and Derren have been featured in an Enagic newsletter, where they talk about “building a community for distributors, which could help each other succeed and change lives.”

There are 3 different Enagic “investments” these platforms typically promote to people.

The first is buying a K8 for $4890, one of their most popular water ionizers.

The second is what people call the “Trifecta,” which consists of purchasing a K8, an Anespa mineral ion water spa system for $2890, and a four-month supply of Ukon turmeric supplements for $760. The latter will auto-ship to you three times a year. With taxes, shipping, and handling all added in, this comes to an initial “investment” of around $10,000.

The final and least common is the “Quad” or “Quadzilla,” which is a trifecta + an extra K8 that most attach to a bathroom faucet or loan out to leads (people they want to sell to). Of course, this would be an investment of around $15,000.

AT THE MOMENT (20 May. 2021), Mike and Darren’s “Dream team” has more than 90,000 participants. A considerable number of them are Filipino expats, people who have been affected by the COVID-19 pandemic and are trying to make ends meet.

I have to admit that it’s a clever scam as it double-dips: first, you have to pay to join the system, which provides no real knowledge or training but convinces you to invest and buy a Kangen Water machine to become a distributor.

So, if the numbers are right, if we have 90,000 individuals in the “Dream team”, all those people have paid US$149

90,000 X $149 = US$ 13,410,000

Not everyone has become a distributor, but if we assume half are, that makes appr. 40,000 individuals have purchased at least one Kangen Water machine at an average price of $4,000.

40,000 X $4,000 = $160,000,000

That’s a lot of profit for Enagic. And Darren and Mike.

Why is this a scam?

Scam: a dishonest scheme, a fraud

1. FALSE ADVERTISING/DISHONESTY: You’re tricked into thinking you’re joining an online training/business system. In reality, you’re charged $149 US to be convinced you must become an Enagic distributor and buy an overpriced water machine.
2. SECRECY: By not identifying the business with a defined public brand, it goes unnoticed, and it is more difficult to find information about it on the Internet. When you join, they ask you not to share information outside the group, neither the private group nor the company’s name, and basically nothing. The Facebook groups are secret by design. The less people know, the better.
3. SOCIAL NETWORKS ABUSE: Facebook forbids “ads promoting business models offering quick compensation for little investment, including multilevel marketing opportunities.”
4. PREDATORY SCHEME: The scam targets people with minimal computer literacy, experiencing hardships with promises for easy money. A typical “get-rich-quick” scheme. If you can’t afford tp pay the $4,000 for the machine, they encourage you to take a LOAN or a new CREDIT CARD.
5. SELLING ‘THE LIFESTYLE’: These two’s marketing pitch is based on the ‘financial freedom dream,’ which, let’s be fair, only about one to two percent of all independent consultants working for MLM companies can achieve by making huge salaries that you hear about in the testimonials.

If you search online for “We’re Helping Thousands of Hard Working People To Switch It Up And Become Online Entrepreneurs”, you will find hundreds of templated websites’ like:

The websites are built on Landingi landing pages and Clickfunnels. Payments are processed through Stripe. Domains are purchased from GoDaddy. Ads are posted on Facebook and YouTube.

All those companies share responsibility for allowing the scam to continue.

Are those people “experts” who will teach you and give you the training you so desperately need?

No. They are people like you, duped into becoming Kangen Water distributors.

Those who complain are banned from the group. The scamming duo targets those who expose or criticize the system, as they have a lot of money to spend on legal proceedings.

Quote: “From what I have learned from combined testimonials, this couple has initiated several legal proceedings against those who expose or criticize their system on the Internet. It’s always suspicious when there is so much to hide, isn’t it?”

So the big question remains:

Why are those scams and illegal pyramid businesses allowed to operate in Canada?

Why is this not looked at and investigated by the media?

Why are the authorities closing their eyes at thousands of people being scammed into purchasing overpriced, useless machines?

Why are unethical business systems like Mike and Derren’s being allowed to exist?

Better Business Bureau Investigation

See all additional business information

Additional Information: BBB opened an investigation into betterlife.buzz (AKA Darren and Mike also AKA WorkShopReplay)(note: after BBB’s investigation, the betterlife.buzz homepage seems to have been disabled. However, training.betterlife.buzz is active) due to public inquiries.

During the investigation, BBB found that betterlife.buzz operated affiliate marketing webinars and sold an affiliate marketing program. The stated purpose of these webinars was to introduce & explain the basics of the affiliate marketing program offered by betterlife.buzz. The webinars are 60–90 minutes in length. The content of the webinar is aspirational and motivational rather than informative.

BBB has found many other websites offering the same marketing program. The other websites use an identical format, but different urls that link to the same privacy policy and terms and conditions pages.

The webinar has two sections, the first is the founder or host talking about why viewers should become affiliate marketers, what the earnings potential is and how little work is involved. The second half is current users of the program talking about their introduction and experience with the program. The webinar does not provide any specific details about the affiliate marketing program.

The few mentions of the program do not include sufficient details for a viewer to understand how the program operates or what their involvement will be. The webinar host claims that the program “does 90% of the work for you”.

According to the webinar, the software they give you access to is worth $ 21,000.00. They mention access to mentors, high-commission products, and a sales funnel but do not detail what the viewer is expected to do to earn 6 to 7 figures a year. The webinar also does not mention why they offer this program to others.

On August 16, 2019 BBB asked betterlife.buzz to provide the following information: Please provide the average, median and earnings range for people using your program.

Do your community members market the program? If so, do they make any commission on the program’s sales? Do community members earn income based on the income of their recruits?
How many of your users are marketing better life.buzz?
How many of your users were brought on via affiliate marketers rather than by seeking a better life? buzz out themselves?
The webinar also mentions a “proven sales funnel.” Can you provide some information to explain how the sales funnel has been proven?

As of August 26, 2019, BBB has not received a response.

Here are two quotes from the BBB complaint page:

“This group is full of manipulators. They use ads to manipulate people to watch their webinar, where they manipulate you even more and don’t explain the entire business. You have to pay to learn more, where again you are manipulated by a coach who will dance around the bush, rather than get straight to the point. Business owners end up having to invest thousands into Kangen water, which is a totally separate business. However, they have masterminded how to manipulate the commision schedule for profit. Once you are a business owner, they teach you how to manipulate people to join, and how to manipulate Facebook, and other social media platforms to allow your ads…. that are not allowed as this is an MLM.

After that you will delete all negative comments to manipulate people into thinking the business is great. You will also share who these negative Nancy’s are to the dream team so they can ban and block them from their business page. They will tell you to follow the law of attraction, and buy crystals…. because if you believe in the business you will achieve? Yet most people don’t believe it because people are hardly making a penny, let alone what they invested. They manipulate these people and use them as pawns. The people at the tops make hundreds of thousands, but 80% invest their last bit of savings or credit, to not make a penny and end up broke.” Leila R

“This training is nothing else than a scam. Unfortunately these 2 Kangen Water distributors created this training to distract people from the real business as an Enagic distributor. They created a “business” where people are attracted to start an online business and to attract more people to to sign to this webinar. At the end people has to pay $150 to enter into this group. I was attracted by this “training” and now that I came out of this group I can talk about this scam.” Mirela Botez

Also, other Kangen Water scams are online (like the Breakaway Movement, etc.).. A very informative article about most of them exists.

The bottom line is that MLM and pyramid companies are the perfect environment for dishonest people to thrive.

Reporting fraud is crucial!

Fraudulent or suspicious activity can be reported to the Canadian Anti-Fraud Centre through its website at www.antifraudcentre.ca or by telephone at 1 888–495–8501.

Misleading advertising and labeling

The misleading advertising and labelling provisions enforced by the Competition Bureau prohibit making any deceptive representations to promote a product or a business interest, and encourage the provision of sufficient information to allow consumers to make informed choices.

Please use the following form to notify the Competition Bureau.

Contact the media

List of Canadian media emails.

RCMP

If you have lost money by investing in this scam, you can also report it to the local RCMP.

BBB

Some additional actions you can take to protect yourself and others include:

• Sign up for BBB Scam Alerts.
• Encourage others to report scams to BBB Scam Tracker by sharing via social media.
• View our most recent research reports.
• Find your local Better Business Bureau to assist you via our online directory.

Alkaline Water Criticism in the Media

Alkaline water has been roundly criticized in the media. Here are just a few of the examples and some quotes:

• McGill University
  Title: Alkaline Water Nonsense
  Subtitle: The words absurd, ridiculous, ludicrous, preposterous, comical, and farcical come to mind, but they still don’t seem to capture the extent of the mind-numbing nonsense. And what nonsense is that? ‘Ionized Alkaline Water!’”
• New York Times
  Expert: “It’s all about marketing. There is no science to back it up.”
  Other analysis: This article notes that companies funded several small studies seemingly for marketing.
• Science Based Medicine
  Subtitle: “Alkaline water is pure BS — there is no plausibility to the claims of any health benefits, and what evidence we have is negative. Its popularity grows despite this.”
• The Guardian
  Key Quote: “While people have been touting the benefits of upping your alkaline levels for decades, Fenton says no scientific evidence supports the belief. Fenton, who analyzed studies looking at the association of alkaline water with cancer treatment, notes that while ‘there are a few very poorly designed studies’ suggest alkaline water confers health benefits, there is no rigorous evidence this is the case.’
  What’s more, Fenton stresses, you can’t change the pH of your body by drinking alkaline water. ‘Your body regulates its [blood] pH in a very narrow range because all our enzymes are designed to work at pH 7.4. If our pH varied too much, we wouldn’t survive.’”
• Vice
  Subtitle: “No, Alkaline Water Isn’t Making You Healthier—It is Making Your Wallet Lighter, though.”
• Self
  Title: “What Is Alkaline Water and Is It Better Than Regular Water?”
  This article included several experts who debunked alkaline in decent detail.
• Truth in Advertising
  Truth in Advertising covers the class action lawsuits against the makers of alkaline water companies, citing an expert who says, “It’s all about marketing. There is no science to back it up.”