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If you’ve been reading this website for any length of time, you’ll know that I have some reviews about MLM companies that are indeed pyramid schemes or have been called such over their existence.
Some of these companies are still in operation but have been plagued with the label of them being pyramid schemes.
I’ve had to defend my reviews and my opinions countless times from commenters who may be distributors and business owners linked to these MLM companies who think that their MLMs are pristine institutions.
Well just in case I didn’t do a great job of explaining what a pyramid scheme actually is, here’s a video that should make it clear.
Using a real example with the case of Vemma, a nutrition MLM that was shut down in 2015 by the FTC, Stacie Bosley explains what a pyramid scheme is and how you can easily spot one.
The FTC says that pyramid schemes can seem legitimate but their downfall is in the way the income is earned and distributed. If the majority of income comes from internal sources (retailing to downlines or buying products for resale) rather than from sales to actual retail customers, then you’re most likely involved with a pyramid scheme.
This happens way to often and one example I can think of is the MCA motor club opportunity where most of the reps focus on getting other reps in their downline. The new reps have to pay a fee in order to get the motor club benefits and promote the opportunity. Guess what these new reps focus on doing?
Yes, getting more reps.
Anyway, check out the video and you’ll learn how to spot a pyramid scheme so that you can avoid being recruited.
Also check out John Oliver’s video.
Comment below your thoughts and share if you think that someone else may find this video useful.