On January 13, the Federal Trade Commission (FTC) secured a Temporary Restraining Order against Success By Health, appointing a Receiver the same day. The Receiver's first report, filed by February 10, detailed significant operational irregularities and a business model heavily reliant on affiliate purchases rather than retail sales.
FTC agents, acting on the TRO, visited Success By Health's Henderson, Nevada office around 1:45 PM. The location is linked to Success by Media, a company owned by Jay Noland. Robert Towns, Director of Media at Success by Media and a Success By Health affiliate, was the only person present. He declined to answer questions, handing over keys before leaving.
Agents reported finding no computers on-site at the Nevada office. Security system drives were imaged but not removed. Five external storage devices were surrendered. Very little documentation was found, limited to a few event receipts, brochures, and invoices. An administrative assistant, Yaquilin Lizaola, also declined cooperation.
Later that day, around 5 PM, two Receivership agents, accompanied by local police and the landlord, accessed the Winchester, Kentucky office. This location was initially empty, but two Success By Health affiliates later arrived. They received copies of the TRO, contact information for the Receiver, and a questionnaire, but refused interviews and to complete the questionnaire.
No computers were found in the Kentucky office either, though computer equipment, a printer, and email printouts to warehouse@successbymedia.com suggested a computer had been there recently. The Receiver emailed the address requesting the missing device, but received no response. Jay Noland never produced it.
The Kentucky office contained Success By Health products, shipping supplies, invoices, and marketing materials. Pallets of inventory were in the common area, with the landlord estimating most had been there for over a year. Agents also seized a fishing boat and gear from a storage space registered in Noland's name.
The absence of computers at corporate offices was noted as unusual by the Receiver. Success By Health did not provide a device list until January 28. This list indicated a computer had been in the Kentucky office but removed prior to the agents' arrival. It also included two company iPads and a company iMac Pro desktop, none of which were found at the Nevada location or surrendered.
Aside from two company laptops previously with Noland, the individual defendants used personal devices for business, typically a MacBook Pro and an iPhone. Noland also used a Dell laptop. Nine personal devices were identified as tied to the business. As of February 10, arrangements to image these devices had not been made. The only devices the Receiver obtained were the two company laptops from Jay Noland.
The TRO mandated the surrender of company documents and electronic data. The Receiver reported "considerable difficulty" in obtaining these materials, gaining meaningful access to electronic data only after two weeks. Several data requests remained unfulfilled as of the report date. Corporate email access for some accounts was granted on January 27, with thirteen accounts secured by January 30. Six accounts remain missing. Discussions between the Receivership and Success By Health's attorneys are ongoing. The Receiver has not yet filed a non-compliance affidavit, but this option remains under consideration.
After repeated requests, the Receiver accessed the company's DropBox account, which held an "SBM Storage Team Folder" containing video, audio, and training materials. Based on available documents, the Receivership Entities did not adhere to corporate formalities. Noland testified in his deposition that a Board of Directors existed, but no documents regarding its composition, meeting notices, minutes, or resolutions were found. Business plans and internal budgets were also absent.
The company operated without a Chief Financial Officer or a system for tracking invoices and payables. Jay Noland made payments directly from Success By Health's bank accounts as he chose. The company appears to have at least two Intuit QuickBooks accounts that might track expenses, but the Receiver's requests for access have not been granted. The absence of an invoicing system made compiling a comprehensive list of current liabilities nearly impossible.
The Receiver seized $440,538 from accounts linked to Success By Media and Enhanced Capital Funding Corp. An additional $169,107 was held in payment processor accounts. Analysis of Success By Health's Affili8 cloud services showed $603,870 in liabilities when the company ceased operations, including $233,345 in commissions payable and $213,035 in product manufacturing expenses. A revised list of liabilities the Receivership intends to pay totals $62,594, excluding affiliate commissions and manufacturing expenses.
Financial records indicate Success By Health generated $6.1 million in revenue. Of this, 95% came from affiliate purchases, with only $250,491 from retail sales. This means the vast majority of SBM's income derived from individuals buying the opportunity to recruit and sell, rather than from customers purchasing coffee and nutraceuticals for personal consumption. Retail activity was negligible.
Between January 2017 and July 2019, 4,913 Success By Health affiliates qualified for commissions, receiving $1,028,378, which accounted for approximately 19% of total revenue. Success By Health marketing materials claimed 50% of company-wide revenue went to affiliates. In reality, 26%, or about $1.58 million, was directed to companies owned by Noland, Scott Harris, and Thomas Sacca: Enhanced Capital Funding (Noland), Arcadia Integrated Solutions (Harris), and Moringa Revolutions (Sacca).
Noland established a $500,000 ten-year contract with a 15% annual royalty between Success By Media and Enhanced Capital Funding, both his companies. These royalty payments were supposedly for coffee, tea, and product mix formulas. The Receiver found no vendor licenses referencing these formulas. Success By Health does not manufacture these products itself, and no vendor communications support the use of Enhanced Capital Funding's formulas in any Success By Health products.
Noland, through Enhanced Capital Funding, also charged Success By Media $304,889 for "affiliate software." It remains unclear how Success By Health paid for this software or if it received any value from these payments. Last year, Jay Noland moved his family to Uruguay, with Success By Media covering the costs, framed as a Success By Health expansion. Expenses included tens of thousands for family apartment rental, furnishings, and a $145,000 2020 Range Rover. By the end of 2019, the Uruguay operation had generated one customer, who purchased a $49 affiliate membership.
The Receiver acknowledged Success By Health's high margins, low employee costs, and positive cash flow, apart from refund exposure and unpaid vendors. However, profitability was deemed dependent on "making promises that are unrealistic and unobtainable." During one seminar, Noland stated, "Over two million people are part of my team, and every time they do something, I make some money. What if all I did during the course of the year was just made one dollar off of the efforts of two million people, what would that pay me?"
As of January 13, 2020, total affiliates numbered 6,754, but only 5,003 actually earned commissions. Statements about the company's scale were misleading to potential affiliates. Noland also claimed Success By Health created millionaires and that the commission structure allowed affiliates to quickly recover their initial investment. In one video, he asserted an affiliate could earn $173,500 a month, adding, "Is it possible? Yes. Does Jay have anybody in his networking doing it? Yes."
These claims were inaccurate. No affiliate earned $173,500 in any month or over a year, and no one became a millionaire through Success By Health. Noland himself received less than $1 million from the company over three years, with only $20,092 of that from commissions. Success By Health's tax records show 272 affiliates earned commissions of $500 or more in 2019, representing about 4% of affiliates. These figures are gross, not accounting for affiliate spending on products or training events.