4 ms·

This is very rampant in India as well, local facebook groups get at least 5-10 posts a day regarding pyramid schemes and offers. The response is equally high to

This is very rampant in India as well, local facebook groups get at least 5-10 posts a day regarding pyramid schemes and offers. The response is equally high to these post averaging 50-100 comments whereas other posts barely receive any. Showing the promise land of instant riches without hard work via flashy ads and illogical math creates such greed amongst the low-income community here (which is the majority of the population, btw) that it is almost heartbreaking to see them lose their everything eventually. MLM/Pyramid scams cannot be stopped via government bans or awareness programmes as such, it needs an equal rival which not only makes the same promises but magically also fulfills them somehow. As much as I have observed, the amount of hard work they do for recruiting new members can well be exchanged for a handsome salary with a steady future income promise leading to a better financial gain over time.

otp124 9y ago
> it needs an equal rival which not only makes the same promises but magically also fulfills them somehow. How do you propose to "magically" fulfill a pyramid scheme without a pyramid scheme?
- ddorian43 9y ago
  He's just saying stupid gonna stupid. Can lower them with education. But I've told people "yo it's 100% MLM" after first sentence and still had a "I want to believe!" mentality. People that have finished university.
bluecalm 9y ago
I don't agree. Make MLM's illegal, punish people who recruit. They will dry up in no time. The problem now is that they are perfectly legal (or can be made legal by introducing sham product to make it less like a pure pyramid) so recruiters can scam others out of their life savings with impunity.
- viraptor 9y ago
  Is there any country with a working anti-mlm law? I think the line is so fuzzy, it would be really hard to define what's a scam and what isn't. What's the difference between a franchise/dealership and an MLM where some product really exists and you're expected to pay for the stock up-front? If there was a law against one of them, how close would they get?
  - tialaramex 9y ago
    It's probably not possible to solve this with law. Even the Pyramid Scheme part is semi-optional with newer scams. The last one I looked at had the usual Pyramid shape, with complicated rules so that it'd always turn out that you didn't get any money, but to defuse the whole "it's a pyramid scheme" thing they said well you can just buy the product and not "join" anything, that's fine too... And then you realise, wait a minute, the product is basically fruit juice in a fancy bottle for maybe 5000% markup. So, even if you didn't fall for the pyramid scheme, if you buy the juice you _already got scammed_. I looked at their company structure and the MLM company is legally completely separate from the juice company even though you can't buy the juice elsewhere. So even if the MLM company was shut down for being an outright scam (which isn't likely even in a country that doesn't elect a barely literate reality TV star to run it) the juice company locks in a large fraction of the profits and that's 100% legal, they simply sell a cheap product at a high price and keep the difference for themselves, nothing could be more in line with the American Dream. Because the MLM makes people buy juice to get their money, and that leaves them with crates of awful-tasting juice they'll never drink, they're tempted to eBay it for say, half the RRP to cover some of their losses. But of course if the juice was available on eBay for half price it shows everybody what a scam this is, so company policy strictly forbids this...
  - AJ007 9y ago
    It can work the other way too. How many people have had their savings wiped out starting s restaurant when they had no idea what they are doing, compared to people who started a McDonald’s or Subway and made out ok? The only thing you can do is force publication of accurate numbers, and audit them. I have a pretty low view of people who with IQs over 95 that join pyramid schemes. They are throwing their friends and family under the bus in hopes they personally get rich. That is extremely immoral even if you are poor. In the US, if you do this, at best your friends will think you are an idiot, at worst you are going to get cut off. I’ve seen both happen more than once.

otp124 9y ago

> it needs an equal rival which not only makes the same promises but magically also fulfills them somehow. How do you propose to "magically" fulfill a pyramid scheme without a pyramid scheme?

ddorian43 9y ago
He's just saying stupid gonna stupid. Can lower them with education. But I've told people "yo it's 100% MLM" after first sentence and still had a "I want to believe!" mentality. People that have finished university.

bluecalm 9y ago

I don't agree. Make MLM's illegal, punish people who recruit. They will dry up in no time. The problem now is that they are perfectly legal (or can be made legal by introducing sham product to make it less like a pure pyramid) so recruiters can scam others out of their life savings with impunity.

viraptor 9y ago
Is there any country with a working anti-mlm law? I think the line is so fuzzy, it would be really hard to define what's a scam and what isn't. What's the difference between a franchise/dealership and an MLM where some product really exists and you're expected to pay for the stock up-front? If there was a law against one of them, how close would they get?
- tialaramex 9y ago
  It's probably not possible to solve this with law. Even the Pyramid Scheme part is semi-optional with newer scams. The last one I looked at had the usual Pyramid shape, with complicated rules so that it'd always turn out that you didn't get any money, but to defuse the whole "it's a pyramid scheme" thing they said well you can just buy the product and not "join" anything, that's fine too... And then you realise, wait a minute, the product is basically fruit juice in a fancy bottle for maybe 5000% markup. So, even if you didn't fall for the pyramid scheme, if you buy the juice you _already got scammed_. I looked at their company structure and the MLM company is legally completely separate from the juice company even though you can't buy the juice elsewhere. So even if the MLM company was shut down for being an outright scam (which isn't likely even in a country that doesn't elect a barely literate reality TV star to run it) the juice company locks in a large fraction of the profits and that's 100% legal, they simply sell a cheap product at a high price and keep the difference for themselves, nothing could be more in line with the American Dream. Because the MLM makes people buy juice to get their money, and that leaves them with crates of awful-tasting juice they'll never drink, they're tempted to eBay it for say, half the RRP to cover some of their losses. But of course if the juice was available on eBay for half price it shows everybody what a scam this is, so company policy strictly forbids this...
- AJ007 9y ago
  It can work the other way too. How many people have had their savings wiped out starting s restaurant when they had no idea what they are doing, compared to people who started a McDonald’s or Subway and made out ok? The only thing you can do is force publication of accurate numbers, and audit them. I have a pretty low view of people who with IQs over 95 that join pyramid schemes. They are throwing their friends and family under the bus in hopes they personally get rich. That is extremely immoral even if you are poor. In the US, if you do this, at best your friends will think you are an idiot, at worst you are going to get cut off. I’ve seen both happen more than once.