Pyramid Scheme Termination Cause

These are articles from THIS Organization. The Rest of Articles are from relevant organizations exposing Pyramid Schemes and MLMs

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Separate Organizational sources

This section displays articles from other organizations with similarity to Pyramid Scheme Termination in purpose to spread awareness of the flawed and deceitful practices of MLMs or pyramid schemes

Freedom of Mind

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This organization specializes in cult consoling, recuperation and education. Steve Hassan has counseled individuals involved in various cults, including the MLM cult. These articles are informative. See link below for their website. 

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- Explanation of loaded language MLMs use to promote financial trap 

- Referencing Betting on Zero Documentary

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- See Reference to Dream podcast

- Read about flawed legislation of HR 3409

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- See BITE Model as a helpful reference for pyramid scheme methods and manipulation 

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See explanation of money transfer scheme

See Reference to Amway lawsuit settlement

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Steven Hassan’s BITE Model

November 6th, 2018

- See BITE Model as a helpful reference for pyramid scheme indoctrination methods and manipulation 

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- The legal system should be updated to reflect the current understanding of bioethics and to help diverse individuals and groups affected by undue influence. Destructive cults include Multi Level Marketing

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Resources from PSA (Pyramid Scheme Alert)

(Different Organization)

This is a separate organization, the first of its kind to inform about the treachery of MLMs.  PSA (Pyramid Scheme Alert) aids legal cases and provides MLM or pyramid scheme info to shows and documentaries. These articles provide deep insight. Our organization is distinctive from the PSA due to our 501c3 status, which is useful to start a collective movement against MLMs.

 About Multi Level Marketing

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Highlighted Quote: Dangerously false health claims aside, MLM revenue in the time of Corona reveals it is not and never has been “direct selling.” The identity of MLM is fake, a con for luring people into MLM’s income-opportunity scam. 

Highlighted Quote: As an unintended consequence, this criminal prosecution provides yet more evidence that it is not possible to tell the difference between illegal MLMs and what the government  calls “legitimate” MLMs.

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- Intro to pyramid schemes and MLMs 

- obscurity and non transparency

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- Notice common themes of MLMs through example

- Question BBB rating system

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- Notice the flaws of endless chain commission and endless chain recruiting

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- SEC sues MLM Company for being a pyramid scheme. (compliant attached)

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- During US 2008 recession, it is despicable that MLMs used that time to target the vulnerable into financial traps.

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- Learn from example 

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Highlighted Quote: The bottom 99% (99.24%) of all Herbalife sales representatives earn a mean average income of $1.65 p. wk. before all business expenses and inventory purchases are deducted.

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Highlighted Quote: The analysis also showed that less than 2% at the top of the Stream/Ignite sales pyramid received 55% of all commissions.

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Highlighted Quote: Update: The MLM scheme, Fortune High Tech Marketing, was ordered in ’09 to stop doing business in the state of North Dakota by state regulators. FHTM is one of fastest growing new versions of “endless chain” recruitment schemes based in the USA.

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Highlighted Quote: This icon of “direct selling” just announced that it has agreed to pay restitution to consumers and reform costs estimated at over $150 million.

Highlighted Quote: Despite the Trump endorsements and all the hype about income, Montana’s case against ACN was compelling: virtually all ACN distributors in Montana had lost money.

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Highlighted Quote:The average paid out to the bottom 96% is $115 per mo. This is less than the initial and monthly cost of participating, not counting all other normal business costs.

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 Highlighted Quote:The analysis also showed that less than 2% at the top of the Stream/Ignite sales pyramid received 55% of all commissions.

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Highlighted Quote: After years of delay in the Belgian courts, a ruling was finally gained: It concludes that Herbalife is exactly what the consumer group claimed it is, an illegal pyramid scheme based on “endless chain” recruiting. Such a plan dooms the vast majority to losses, by its design and deception.

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Highlighted Quote: Texas consumers who were involved in the scheme may be entitled to refunds, totalling more than $1.3 million. The company has also agreed to pay hundreds of thousands of dollars to the state of Texas for legal costs of prosecuting the scheme.

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Highlighted Quote "The staff of the Federal Trade Commission (FTC) has reversed its earlier position on the need to regulate multi-level marketing and has now recommended exempting all MLMs from a proposed “business opportunity rule.” This means MLMs will have no rules requiring disclosure of income averages, recruiting requirements, saturation, failure rates..."

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Highlighted Quote: "Now, however, it appears that even the “unlimited” income offer is not working. The obsolescence of this product in the face of cell phone and Skype technology may be greater than even Donald Trump’s endorsement."

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Highlighted Quote: Royal Canadian Mounted Police (RCMP) in the province of Manitoba in central Canada have brought criminal fraud charges against a prominent multi-level marketing company, its president and 12 of its promoters.

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Highlighted Quote: "The story is a lesson for the world. In China, the schemes are seen as especially pernicious during a Recession because they cause financial harm to people who are already financially struggling. Additionally, the government of China sees pyramid schemes as a subversion to the general economy and therefore a threat to the nation."

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Highlighted Quote: "Herbalife is at the center of headline news stories right now. Major investors are calling Herbalife a “pyramid scheme” and a money trap. They report that 99% of all who sign up never make a profit. "

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Highlighted Quote: A state judge in Utah modified an earlier decision and now has ruled that a prominent Nu Skin whistle-blower is legally allowed to call that company an illegal pyramid scheme, based on the whistle-blower’s analysis, direct experience and knowledge of the Nu Skin business.

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Highlighted Quote: "Loyalty and obedience are cultivated among followers who are taught to “exalt” their sponsors.  The highest ranking company leaders are presented at sales rallies as near demi-gods."

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Highlighted Quote: "A hedge fund manager – who is famous for rigorous research, uncanny insight into future trends and for selling “short” the companies that he thinks are unsustainable – publicly asked a few pointed questions about the MLM company, Herbalife. The mere questioning appears to have triggered a panic sell-off of the stock."

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Highlighted Quote: "Why would Amway be asked “how much” of the products are actually retailed? The reason is that this question determines the very legality of the entire Amway enterprise. And Amway is continuously accused of operating illegally."

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Highlighted Quote: "The lethal combination of cult and pyramid in a multi-level marketing company was vividly explored in a recent newspaper series on the multi-level marketing company, NXIVM (pronounced like the acid reflux “purple” pill)."

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Highlighted Quote "The FHTM case reveals, not that consumers are protected by the FTC, but rather they remain in extreme danger from the multi-level marketing “industry” due to FTC’s failure to define the terms of legality for MLM enterprises."

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Highlighted QuoteThe ratio of the winners to losers will be the same and the only way for anyone to make money will be by transferring “losses” from most to the few winners.

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Highlighted Quote: "The MLM cult rules always require continued paying of money to the MLM’s and free marketing work for the MLM. Doubting the rules or the promise is a MLM sin. Questions are MLM heresy. "

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Highlighted Quote; Herbalife has been called a “pyramid scheme” by one of the country’s largest hedge funds who presented a 300-slide presentation laying out the facts on Herbalife of a pyramid money transfer, inflated pricing, deceptive earnings claims, excessive charges for shipping, and large-scale losses by Herbalife distributors.

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Highlighted Quote: It is often said that recognizing “pyramid schemes” is difficult, complex, and confusing. Over the years that I studied “multi-level marketing”, I came to realize that the challenge of recognizing pyramid schemes is not complexity or disguise; it is political protection, denial and avoidance.

Author Robert L. FitzPatrick, Pres. of Pyramid Scheme Alert has published an eye-opening, succinct exposition of the realities of “multi-level marketing.

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Highlight Quote: Using data from 11 MLMs that published “income disclosures”, the report showed that less than 1% of all MLM participants ever earn a profit, according to the MLMs themselves.

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Highlighted Quote: Donald Trump was paid $400,000 to endorse ACN. New about ACN’s purchase of publicity and credibility

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Highlighted Quote: Less than 2% of reported Herbalife Supervisors received $35,000 or more on average, before expenses and product purchases are deducted. The reported income of the top 2% is based on worldwide, not domestic-only recruitment chains.

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Highlighted Quote: "One of the the greatest obstacles – perhaps the most important one – to law enforcement of Main Street pyramids is the disguise of pyramid schemes as “direct selling” enterprises that offer a viable “income opportunity” to large numbers of people ."

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Highlighted Quote: Yahoo Finance reporter, Stephanie Asymkos’s podcast marks the first time the business media has dealt strictly in reality about MLM and  acknowledged the real-life experiences of millions of people of extreme deception, psychological manipulation and financial loss at the hands of MLM promoters, with no personal recourse to the courts or government. 

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Highlighted Quote: MLM is always called “legal” but this refers to lack of law enforcement, not settled law. Bernard Madoff was also referred to as “legal” for almost 20 years before the truth of his illegality was finally revealed. He was never legal, just not investigated.

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Highlighted Quote: "Avon has long been, and is today, the pillar that holds up the credibility of the direct selling industry. It has unintentionally lent legitimacy to multi-level marketing (MLM) schemes that sold outrageous health scams, some that were sued by financially ruined consumers and others that were shut down by regulators for pyramid fraud."

Has MLM Corrupted Avon?

Jul 31, 2011 | News

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Here is a list of movies and clips on multi-level marketing fraud that not only bring a smile but also open eyes and minds. It appears that comedians and satirists see the fraud of multi-level marketing plainly, while regulators and the main stream media are flummoxed.

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Highlighted Quote: In fact, as an “endless chain” recruiting model, MLM  is rigged – fixed. The losses are inherent and would occur no matter how many “tried” and “worked hard.” Those at the top always win.

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Highlighted Quote: In fact, prosecutions of one MLM typically resulted in top recruiters starting numerous others, modeled exactly on the ones that were shut down.

 PSA: Continued (Other Pyramid Schemes

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(Different Organization)

 Penny Stock

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Highlighted Quote: Millions of shares are issued but only 20% are actually sold to the public. One or more people control the other 80% even though they may have invested little or no money of their own. This ensures massive profits to the insiders, including the company waiting in the wings for the merger, and to prevent any interference from those who actually put up the money.

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 About Social security

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See info about social security and contrast that to an MLM scheme

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- See info about social security and contrast that to an MLM scheme

- MLM recruiters often criticize social security to promote their scheme, ironically social security has more foundation than MLMs

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 Gifting

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- See a list of articles on gifting schemes

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Gifting Schemes

Apr 13, 2010 

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"A Michigan newspaper reports that “seven Newaygo County women have been arraigned… on felony charges in connection with a pyramid scheme targeting women.” The article states that the women are facing charges of pyramid chain promotions, which carries up to a seven-year sentence and a $10,000 fine."

Anti-MLM Coalition