Islamic Finance

ACN: What is the Islamic position?


They say that there are two things that are certain in life, death and taxes. Well now there’s a third contender, ACN phone calls. Having researched this for over a year now, my conclusion is that ACN is not just a business, it is a social movement. But unfortunately it is a corrupt one that preys on the vulnerable and gives them false hope.

ACN In Brief & The Problem

ACN is a kind of multi-layer marketing (MLM) system where a person hypothetically gets paid not only for his sales but also a percentage of sales of those below him. A person also gets paid when he signs up new members to his team. In theory this is fine,  but problems arise when the sign-up bonus that an individual gets is far greater than any sales revenue, and when signing up new people is massively incentivised and making sales to new people disincentivised. The result is that a large amount of money going into the ACN system is by participants themselves, not customers, and this money is then used to pay off those higher up the chain – rather like a straight-forward pyramid scheme.

There is a gradient between a pyramid scheme and a MLM scheme, but I’m of the view that ACN is far closer to the pyramid end of the spectrum.

A lot has already been written on the ACN structure and I see no point repeating what has already been said. The key resources I have found to inform an Islamic discussion on ACN are:

  1. Shaykh Abu Easa’s analysis
  2. Initial thoughts on the matter by Sh. Haytham
  3. A very detailed analysis of the various problems with ACN
  4. A video explanation by a Muslim brother
  5. A fatwa on the topic by IRTIS

The reason why a number of scholars have abstained from commenting on this area is because of three reasons:

a) The suspicion that it might be legal in form but not in spirit, and so they don’t want to wade in on something they’re not 100% about especially with so many Muslims involved;

b) There is just no data on ACN (both monetary and legal) and what actually happens practically – other than the fluff and the glitz of the conference speeches.

c) Dealing with multi-level marketing is a relatively new phenomenon in some ways from a fiqh perspective so the traditional fatawa books aren’t always illuminating.

A Snapshot Summary of the Fiqhi Problems with ACN

In brief though, I think it is really important to address this issue and to do so robustly and sensitively. There are concerns about riba, gharar, and certain contractual terms being unfair, but I feel the key issues (of fraud, and making the transaction itself the product) are perfectly summed up by Sh. AE when he said:

If there is a definite product and the marketing is about marketing the product alone and has commission based upon sales of that product, then this is permissible absolutely no problem. We get suspicious when there are sign-up fees/licences, but that’s all. We start to turn away if the business model is about signing up people as opposed to focus on the product. It doesn’t matter if the product gets celebrity endorsement and the like – if the product is not the focus of the transaction, and instead it is the transaction itself which is being sold because of the bonuses and commissions receivable as a result of more reps/people, then we are in very unethical area and then the issues of fraud, riba and gharar really start to come into play.”

Yes I don’t think all marketing schemes are haram, but the multi-level/networking versions where the focus is signing up people nearly all are and are highly problematic and should be avoided. Wallahu a’lam.

Some Further Personal Reflections

  1. There is a real dearth of information that crunches the numbers on what people in ACN actually earn, where the money goes, and how the whole system works. You can find some of this by some sustained digging, but the very fact it is not prominent and yet people are being sold a dream is extremely concerning. From a pure business perspective, having run and set up a number of businesses over the years, it is the numbers and cold hard accounting data that gives you a true picture of the success or failure of a business enterprise. That this is less than forthcoming smells fishier than a chippy on Friday night.
  2. What I find fascinating about ACN is that it does not attract the intelligent, well-educated, business-savvy friends and family we have. It attracts those who are struggling, looking for an alternative, may be unemployed, and have the particular mental makeup that makes them vulnerable to cult programming. That in itself should be a warning sign no? (This of course is not an argument against it, it is merely an observation)
  3. The ACN model has made some people well off and some people very rich. That’s why it is still around. (If everyone was losing money then they’d all pack it in wouldn’t they?) That’s why there may be “success stories”, but unfortunately these “success stories” do not equivalate to the experiences of the vast majority of friends and family whom I have seen get involved. It is also the reason why the ACN marketing doesn’t talk about the salaries earned on average and where their money income and outlay goes.
  4. There is a huge amount of Musim uptake for ACN – which I find really intriguing. There are underlying reasons for this. Firstly, Muslim communities, unlike the fractured 21st Century individualistic bubbles we live in, are still somewhat tight-knit. Secondly, with over 50% of Muslims living in economically deprived areas in the UK, it is no surprise that the ACN rhetoric will take root in this soil that has been so woefully neglected by David Cameron et al. Thirdly, Muslims are over-represented in small business ownership (MCB stats) as we have an instinct for entrepreneurship and independence, and ACN taps into this.
  5. ACN restrict their representatives from cold-calling and advertising in their area. Instead they ask them to restrict their marketing to friends and family who are already warm to them. WHY? How does that make any economic sense? Surely the idea should be, get family and friends on board and then reach out to others by marketing, offers, etc? That is if the product was the main thing. However if recruitment is the main objective then it makes perfect sense to restrict the pool of potential customers for each ACN rep to just a handful of close family and friends, so that he is then forced to recruit more reps and generate more funds for ACN.
  6. What this means is that there is appetite, time, and a need for a real entrepreneurial pathway for young kids in Muslim-heavy areas across the country. ACN is not that. But here are some alternatives:
    • copywriting, coding, designing, data entry, website set-up, social media management, translating, the list goes on and on for the kinds of skills that will earn you good to decent income freelancing online. This will teach you a skill, it is real, and it is halal. If you want mentoring I can even try and put you in touch with some people.
    • Online retail via a personal website, Amazon, or Ebay. Yes it is a really competitive market, but it is also a huge market.
    • Raising cash by selling equity or by taking interest-free loans from family, and starting any business you feel is viable

This is a topic that it genuinely would be good to have an informed insider’s views on as well others’ experiences, so please do comment below.

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6 Comments. Leave new

  • brother from u.s
    August 18, 2016 3:54 am

    salam alikum brother…i got into acn and i have been working on it for a few months but haven’t gotten anyone downline or made money, but after seeing your research done on acn and how it operates, ect…i am think of leaving it soon… i had good intetnions of joining and getting a stable income going so i can give more time to learn deen. what is your suggesting now…what should i do? if only giving services to customers is valid and not recruiting new people is permissible i might do that for a bit. give me feedback brother jazakullah.

    • I would suggest exploring other kinds of business – things we can all understand such as buying or selling. May Allah reward you for your efforts.

      With regards to doing ACN just as marketing without recruiting, it sounds fine, but I suspect you won’t earn much that way.

      • I work for a big IT firm based in India and Australia, and my fiirm also holds the right to increase or decrease my variable pay based on overall performance of business unit for which I work. Therefore every such job can be considered haram?
        Also – ACN clearly states that the business partner’s may make profit or loss, where is the ambiguity?

        Similarly aren’t cricket players doing haram job? They are wasting people’s times by playing games and these cricket matches have uncertainty, and moreover these commercial sports do not produce anything useful for anyone, they are just an entertainment source. So every muslim sporstman is doing haraam. If you say sports is good for health so its not haraam, then I say you dont need to play on commercial basis and display it on TV if you want sports for health.
        Regarding coding, software etc, if you make software for a ecommerce website, then that website allows to sell pork, again you have done haraam by helping those who do not intend to sell only halal things.
        So this way, everything is haraam, better we should start to live in a cave, away from world, shouldnt we?

        • Ibrahim Khan
          May 13, 2018 7:37 pm

          IT Company job: Revenue/profit-related bonuses/wages are fine – as there is a clear job you do.
          Cricketer: They get paid for playing cricket. There is no uncertainty to that. Any bonuses for performance are fine.
          Coding for website that sells pork: To the extent you are a separate legal entity providing solely coding services, the business of the customer need not necessarily concern you.
          Living in a cave: Islam specifically prohibits people from “rahbanniyah” or monasticism – so we absolutely shouldn’t do that.

          In conclusion: I respectfully suggest your analogies do not hold water, and that we must remind ourselves that Islam is a religion of common-sense and flexibility – but it is also not a free-for-all.

          • Thanks for replying. You did not mention anything about wastage of time that cricket causes, your partial response clearly indicates that you responded to ‘oppose’ and not to ‘discuss’. Your intention is to ‘win the argument’ rather than to have a healthy discussion. This is not expected from a mature individual. There is no point in discussing with you.
            Anyways thanks for this nice and detailed blog.

  • Assalamualaikum, thanks for your detailed explanation. I have been doing my research and spoken to a few different people about ACN.
    however I want to ask, did you get information from being part of inside the ACN company? Or did you receive any information from someone who are in ACN ?
    Because I know people inside the company, and there is a clear compensation plan set out. There are specific percentages mentioned for every type of commission from each service and the percentage is clear. Also, the compensation is not just based on recruiting people, however it is based on customer points. And you need minimum of your own personal customer points to reach a certain stage ( therefore the goal is not just to recruit people but to accrue customers).
    To my understanding, it is similar to a franchise. For example the person who first founded Nandos allows other people to open up a franchise in a different city. The franchisee would receive some money from customers and the founder will receive the commission from this franchise as well.


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