Pyramid Scheme Pariahs

[BatNapalm]

And it's always "and it won't be long until I do! Just more hard work and dedication!"

I was about to reply to this with a facetious "Yeah and it'll only be a matter of time before I reach Platinum Star Ambassador Executive tier!" and throw in one of the many ridiculous pictures that I found on BK's instagram an hour or so ago, but I went back and his instagram is now private. Hmmm, I wonder what prompted that?

 

[Slightly Observant]

When I was 18 (2010) I went to a Cutco recruiting presentation that was in this dingy looking abandoned building that they spruced up just for this occasion. It was a group of 20-25 people listening to this guy talk about selling knives and what a great opportunity this would be, but he expected us to be taking notes and writing this stuff down like it was a class. Partway through the speech, he started dismissing people, simply saying "your time is up". I was dismissed when the group was down to about 15 people. Never heard anything from them again, but I found what exactly they were later and I realized the bullet I dodged.

More recently, I've applied to a lot of jobs that say "Entry Level Marketing/Pubic Relations/Communication" and advertise "no experience necessary, training provided, management opportunities", but it turns out they're really just sales jobs, but not quite the same as MLM. One job was setting up booths in Costcos and selling products from QVC and Shark Tank and another was going to businesses selling T-Mobile.

They seem more legitimate than Vector or Amway, but the job descriptions they give are vague and misleading in my opinion (The Costco company is called *my metro area* Events, so I thought it was an event planning service). I'm not interested in or good at sales. They also all claim to promote you to management by 6 months and give you the training to start your own company, which makes me wonder if there's some kind of network.

And in the nonprofit sector, you have Fund For the Public Interest, which is basically you standing in high traffic areas collecting donations from passersby. I saw people in college asking people to donate to Human Rights Campaign or whatever hot-button issue of the month, and I think that's what that was. I've heard horror stories of how workers were sent to solicit donations in bad neighborhoods and that they care about quota more than their workers well being or even the causes they claim to stand for. It's the same high pressure sales tactics but to get donations for nonprofits.

I suck at interviews, though, so all of these places turn me down anyway.

TL;DR Cutco is too good for me

 

[sparklemilhouse]

I got scammed by the "magazine donations for military hospitals" scam a few weeks ago.

 

[DrJonesHat]

People I considered friends tried to recruit me into Amway. After that, they were not my friends.

 

[GRANDnumberofMULTIPLES]

People I considered friends tried to recruit me into Amway. After that, they were not my friends.

At that point they just saw you as comically oversized dollar signs anyway.

 

[TowinKarz]

I live in a university town, every year the "Student Painting $25 an hour!" flyers go up, and that's it, the promise of lots of money, and a phone number. I've always been suspicious it's some kind of scam or half-scam, since no company name is ever given, thanks for filling me in that it's pretty much what I thought it was..... and I still have the one old acquaintance who kept trying to recruit me into Amway or whatever MLM he was caught up in. Nice guy, but hopelessly naive and prone to be overly-credulous of things presented as "big secrets" , like, he sends me obviously fake UFO videos and gets disappointed when I point out the flaws because he REALLY wanted to believe it.

 

[Cynical]

Goddamn! This Jamaican guy just called me four times in less than 15 minutes! I ended up blocking the number. I guess I am going to have to do some research and find out how to report this.

Harassment would be an easy way to get this guy to go away. If he calls again, make it clear you have every intention of recording the conversation, and if the guy tries to convince you not to or asks why, tells him you feel harassed by his constant badgering and you want proof to hand over to the authorities of his harassment.

It's a win-win for you no matter what (assuming you really are recording the conversation or intend to)

1. He decides his ass is more important than your wallet and goes away.

2. It's literally on him if he goes ahead. You duly informed him you felt like you were being harassed, he kept going, so if he ignores you, all you have to do is turn the tape over to the authorities and all the information on the numbers he called you with to the authorities, and the burden of proof is on him to prove he's not badgering the hell out of you.

However, DO NOT threaten this guy or say anything he could use to blackmail you. Always remain civil and calm, let him commit the illegalities.

 

[Ouija Board]

Harassment would be an easy way to get this guy to go away. If he calls again, make it clear you have every intention of recording the conversation, and if the guy tries to convince you not to or asks why, tells him you feel harassed by his constant badgering and you want proof to hand over to the authorities of his harassment.

It's a win-win for you no matter what (assuming you really are recording the conversation or intend to)

1. He decides his ass is more important than your wallet and goes away.

2. It's literally on him if he goes ahead. You duly informed him you felt like you were being harassed, he kept going, so if he ignores you, all you have to do is turn the tape over to the authorities and all the information on the numbers he called you with to the authorities, and the burden of proof is on him to prove he's not badgering the hell out of you.

However, DO NOT threaten this guy or say anything he could use to blackmail you. Always remain civil and calm, let him commit the illegalities.

Thanks for the advice but how do I get a hold of Jamaican authorities? I can't call international on my cell phone and I don't have this guy's name as he uses different aliases. He also has gotten smart and is now using a phone that doesn't id on mine, rather it says "Unknown"

This guy is still calling me and trying different tactics on me, like I'm dumb and will fall for it. I practically know the guy's accent, timbre and speech patterns even when he tries to disguise himself as an American man or a woman (seriously that really happened). Just last month he called claiming he was from Publisher's Clearing House and that I won the $10 million dollars and he was getting mad because I kept saying "what?" all the time (I'm hearing impaired) He will get mad if you act like you are slow as well.

He just recently called me again last fucking week, again with an unlisted number.

Gah!

 

[Cynical]

Thanks for the advice but how do I get a hold of Jamaican authorities? I can't call international on my cell phone and I don't have this guy's name as he uses different aliases. He also has gotten smart and is now using a phone that doesn't id on mine, rather it says "Unknown"

This guy is still calling me and trying different tactics on me, like I'm dumb and will fall for it. I practically know the guy's accent, timbre and speech patterns even when he tries to disguise himself as an American man or a woman (seriously that really happened). Just last month he called claiming he was from Publisher's Clearing House and that I won the $10 million dollars and he was getting mad because I kept saying "what?" all the time (I'm hearing impaired) He will get mad if you act like you are slow as well.

He just recently called me again last fucking week, again with an unlisted number.

Gah!

Get in touch with the FBI. Since what this guy is doing is a crime outside the US, they can crossdeck it over to Interpol and the Jamaican authorities for further followup.

Not sure if Jamaica has extradition with the U.S, but that should help.

 

[hard2heart2heart]

Has anyone else noticed a surge in a new scam called ItWorks (the tagline is "IT REALLY WORKS!" for emphasis). Allegedly some of the products "work" in ways that are detrimental to your health in the longterm, but consumers shouldn't worry as all their products are "all natural". I might write/research more later if anyone else is interested in this MLM scheme breaking them down better, but here's a basic rundown:

• "Greens" energy drinks & supplements. Honestly there's nothing exceptional to see here, they're just picking up the pieces of Vemma's crumble. Overpriced garbage that hasn't been evaluated by the FDA.
• Body Wraps (THAT CRAZY WRAP THING) They allegedly reduce stretch marks, and appear to be quite effective in the short term. A sports nutritionist friend of mine claims they're primary function is pushing adipose tissue back into your body (which can lead to severe dehydration, poor circulation, and among other things hypovolemic shock/death).
• Fat Fighters. They're supplements which appear to screw with the proper digestion of fat (which obviously affects the digestion of other nutrients, leading to deficiencies).
• Hair Restoration. I can't imagine a miracle cure to hair restoration being in a MLM, so I won't even bothered reading into it.

The amount of people I've seen buy into this is outrageous, but having gone to highschool with one of their top distributors might make it seem out of proportion. Last I had checked quatloos they didn't have a thread on it yet, so I'm guessing it's quite new. As I research more on the implications of these products & its founders I may check back here with info if the thread doesn't die back out.

EDIT: I added relevant links, and really the only somewhat humorous aspect I found in any of this was this excerpt:

"Morton [a wraps distributor which I don't know to be associated with ItWorks, but essentially sells the same product] claims she has done millions of wraps without any problems and denies there is a health risk. "This not only does not dehydrate you, it will re-hydrate someone who is dehydrated. It's good for you," Morton said. "This is a safe … non-invasive [procedure] and I've wrapped babies."

Even then, the only aspect that's funny is the absurdity of someone letting an untrained health guru tightly wrap their baby in an effort to make the baby lose weight/cellulose.

 

[ASoulMan]

Giant text wall

One of my friends fell to this recently. They've posted about it on their social media accounts along the lines of "Find out how ItWorks REALLY WORKS for you. PM me for more info". Being someone who got suckered into Vemma last summer, I instantly googled the company and lo and behold, the whole thing just screamed pyramid scheme. Just look at this image:

It instantly reminds me of this:

There's a good reason companies like this target high schoolers and college students. Many of them, especially the latter, aren't very good financially, and often or not rely on their families to help them pay for college tuition and the like. They are naive for the most part and will seek out any opportunity to make some green whenever feasible.

Then one day one of their buddies from high school or the dorm nearby comes up to them and talks about this "GREAT BUSINESS OPPORTUNITY THAT'LL MAKE YOU MONEY!" while at the same time not going into any details at all. Sometimes they'll even disguise the MLM presentation as a hangout or a party without even mentioning the company at all until it's too late. Convinced that they'll get good money, the poor souls go along with their buddies and suddenly some asshat wearing a suit or the Vemma Douche Starter Pack walks in and goes "HAVE YOU EVER HEARD OF SO AND SO MARKETING?!?!?".

If they're lucky enough, they'll realize it's a scam and leave. If not, odds are they'll wind up shelling $500+ dollars for a shitty starter pack, be given half-baked motivational cult talk, recommended shitty YouTube videos and books by other MLM hacks, be told to IGNORE ALL GOOGLE RESULTS, and be told to stay up to 1:00 in the morning for a Skype call with everyone in the group to begin the indoctrination. From that point on they either become part of the pyramid, or they come to the realization that they're being taken for a ride (either by friends, family, or themselves) and back out and run without ever looking behind.

Also, it wouldn't surprise me one bit if Vemma affiliates begin to jump ship to ItWorks and other schemes with the FTC breaking down their walls as we speak. It happens to every MLM that goes under fire; Herbalife executives switched to Vemma because their company was getting the legal dick shoved up their ass. Even Alex "King Douche" Morton, the face of Vemma's Young People Revolution, jumped off the Vemma ship months ago to join another scam because he knew the company was going down the drain (which was delicious irony, given that he always trash talked people who quit Vemma or switched to other scams on social media).

It's like the fucking Hydra; when a MLM gets its ugly head decapitated by the legal system, new ones grow and take its place. It's all just a matter of reporting them to the FTC, sites like TruthInAdvertising, and just using experience and knowledge to not fall for this shit again and again.

If this sounds too jumbled I apologize. I'm a little tired right now.

 

[ASoulMan]

I shall necro the thread one last time to bring you all exciting news!

Vemma had it's court hearing with Boreyko and top earner Tom Alkazin as its defendants on September 15th. It took the judge till yesterday to make the final decision, and here it is: http://ethanvanderbuilt.com/2015/09/18/ftc-vs-vemma-the-judgment/

TL;DR Vemma gets pounded in court. Their recruitment aspect gets absolutely GUTTED and the company must actually sell their products instead. They will be watched by the court like a hawk in the meantime. Since much of their profit came from recruitment and Affiliate benefits, all of which are gone now, it's easy to say that the company will go wither and die like how Wake Up Now did.

Rest In Pieces Vemma; your energy drinks were shit and do not prevent cancer

 

[Splendid]

I shall necro the thread one last time to bring you all exciting news!

Vemma had it's court hearing with Boreyko and top earner Tom Alkazin as its defendants on September 15th. It took the judge till yesterday to make the final decision, and here it is: http://ethanvanderbuilt.com/2015/09/18/ftc-vs-vemma-the-judgment/

TL;DR Vemma gets pounded in court. Their recruitment aspect gets absolutely GUTTED and the company must actually sell their products instead. They will be watched by the court like a hawk in the meantime. Since much of their profit came from recruitment and Affiliate benefits, all of which are gone now, it's easy to say that the company will go wither and die like how Wake Up Now did.

Rest In Pieces Vemma; your energy drinks were shit and do not prevent cancer

Now we just need to see if the people they duped will get their money back. I know that it's basically impossible for all of them to get all of their money back, but hopefully they'll at least get something.

 

[Cosmos]

I really like how pyramid schemes are basically designed to make all of your friends, family, and acquaintances hate you. All of these scams tell their adherents to try and unload this crap onto the people in their social circles. But shockingly, people don't like being pressured into buying things that they don't want or need, so you just end up with a bunch of pissed-off people who are now intentionally avoiding you.

 

[AnOminous]

Since much of their profit came from recruitment and Affiliate benefits, all of which are gone now, it's easy to say that the company will go wither and die like how Wake Up Now did.

Now comes the part where they start thrashing around coming up with ways to try to slither around the court order, while the other side keeps filing motions to hold them in contempt and the like, and this goes on for another couple years.

I really like how pyramid schemes are basically designed to make all of your friends, family, and acquaintances hate you.

Most cults are. Part of how they retain members is by alienating them from the rest of society. Pyramid scams just chose a really annoying way of doing that.

So you should probably forgive any ex-pyramid scam member for that, at least unless they weren't utter dicks in other ways, too. It wasn't their idea.

 

[kschang]

(Short intro: Surprised to see my blog mentioned here. I'm K. Chang, aka "MLMSkeptic" at amlmskeptic.blogspot.com. Any way, back with the show...)

It's rather natural that MLM and Cults go together. Steven Hassan, former moonie and now cult expert, had called MLMs "commercial cults" before (there's an article on HuffPost). His FreedomofMind website has plenty of entries on the various MLMs.

I managed to dig up an old Chinese article about how parents in China are forced to commit their adult children to addiction clinics in order to deprogram them of MLM cult.

http://news.changsha.cn/h/189/20141215/2017604.html (note: link is VERY slow, and Google translate may choke)

Pyramid schemes actually don't give a **** about your friends and family. That's actually the "recruiting aspect" of the scam encouraging you to violate the separation between market norm and social norm (terms by Dan Ariely) by reframing it as "going after low hanging fruit" or "sharing" the product / success / whatever.

 

[Strelok]

It should be noted that Vemma is not the norm as far as MLMs, by which I mean they were really, really fucking incompetant at the legal tapdance required by MLMs to stay on the right side of the law. It's like the difference between AL Capone and methead Pete. Other, similar companies will simply look at them as an example of what not to do.

 

[kschang]

It should be noted that Vemma is not the norm as far as MLMs, by which I mean they were really, really fucking incompetant at the legal tapdance required by MLMs to stay on the right side of the law. It's like the difference between AL Capone and methead Pete. Other, similar companies will simply look at them as an example of what not to do.

It's a little more than that, IMHO, of course.

Their product is crap based on pseudoscience, tiny sample size, only two studies EVER (published) done in China, and so on. (Explained here: http://amlmskeptic.blogspot.com/2015/09/scam-tactic-speak-in-half-truths-or-how.html )

Their compliance is crap, as you already mentioned (for those who didn't keep up, with 90000 reps, their "compliance" consists of randomly picking list of 100 names from pool of 90000, and from the list of 100, they randomly pick 15 to call and ask "are you consuming or selling 70% of the stuff you ordered from us?" And do this ONCE A MONTH. And even doing this little, they are FIVE MONTHS BEHIND as per injunction hearing)

Their attitude is crap (going after kids, sometimes, high school students, which they only backed off in 2014 after TruthInAdvertising i.e. TINA went after them) and as long as people produce results they turn a blind eye. YPRPariah (RIP) had documented reps advocating payday loans to recruits claiming they can make it back quickly, and other WTF behaviors.

And while Vemma is indeed egregious, the rest of the industry ain't far behind. DSA lost its soul about alternative retail channel long ago. Most of MLM is on recruiting self-consumers with false promises of "income opportunity" if they recruit more self-consumers. Self consumption is the norm, not the exception, and who's ever heard of a store owner consuming his own stock as primary purpose? (Herbalife: 72% of our reps do NOT want income)

 

[AnOminous]

It's a little more than that, IMHO, of course.

Their product is crap based on pseudoscience, tiny sample size, only two studies EVER (published) done in China, and so on. (Explained here: http://amlmskeptic.blogspot.com/2015/09/scam-tactic-speak-in-half-truths-or-how.html )

Their compliance is crap, as you already mentioned (for those who didn't keep up, with 90000 reps, their "compliance" consists of randomly picking list of 100 names from pool of 90000, and from the list of 100, they randomly pick 15 to call and ask "are you consuming or selling 70% of the stuff you ordered from us?" And do this ONCE A MONTH. And even doing this little, they are FIVE MONTHS BEHIND as per injunction hearing)

As some people have pointed out, perhaps here (I forget but I've talked about Vemma a few places), Vemma is basically the amateur hour of MLM scams. The shit an MLM has to do to be just marginally legal is so pathetically slim that all kinds of ridiculous scams, like Amway, more or less go unprosecuted.

Vemma is so incompetent they can't even maintain the veil of half-plausible legality that lets most of these operations off the hook.

 

[Super Collie]

Funny anecdote about "ItWorks!". Several months ago someone where I work sent out a global email to everyone in the company -- worldwide -- hocking their stupid ItWorks body wraps. I've never seen someone fired from this company so quickly; their email was disabled by the end of the afternoon and employee profile blanked. Either they were already on their way out and tried this as a final "fuck you" or they were stupid enough to try this on literal terms and the company told them to go fuck themselves for it. It amazed me that when even the lowest-paying job at our company is more than enough for someone to live alone in a one bedroom apartment but that there were still people stupid enough to try this as a second job.

Regardless, because this email was sent to literally every single employee it started a massive email chain of people making fun of OP, their products, or both for about two solid weeks. People who spoke in defense of ItWorks (Tupperware, Avon, etc) ended up being relentlessly taunted, it was hilarious.