Last year, the nonprofit fielded 850, 000 requests for "vegetarian starter kits" packed with recipes like Tofu Tamale Pie and testimonials from celebrity supporters like actress Natalie Portman.

WSJ: Beef Industry Carves a Course

Legitimate MLMs charge a relatively small fee for their starter kits, sell products that are purchased by the ultimate user and normally offer reps refunds for unsold items.

FORBES: Can You Really Make Money In Direct Sales?

After the disclosure, Rainwater's organization asked the Federal Emergency Management Agency to return some of the extensive stockpiles of household goods that had been purchased as "starter kits" for people living in trailers after Hurricane Katrina.

CNN: FEMA gives hurricane supplies back to Louisiana