Pyramid Scams: High on your list of Scam Spotting

Pyramid scheme: the quintessence of scamming

Pyramid scams on social media

Differentiating multi-level marketing schemes from pyramid scams

Deceitful claims about possible earnings

Chain letters: are they pyramid scams?

Forfeits invited by promotion/operation of a pyramid scam

Compendium pyramid scams: checking out a pyramid scheme

  • Is there a signing up fee?
  • Does the prospectus indicate fantastic earnings (for instance, “make $100,000 a month legally”)?
  • Do participants realise commissions mainly from selling products or services, or are financial bonanzas largely contingent upon recruiting others into the scheme?
  • Do the products proffer a real income-earning opportunity through sales?
  • Is the number of products that have to be purchased or ordered by the participants commercially pragmatic?
  • Does the prospectus offer boons such as “it’s easy to sign up new distributors” or“a life of happiness and prosperity”?
  • Does the prospectus contain testimonials from people who are hard to identify (for instance, “RS of Waterloo writes…”)?
  • Does the prospectus contain avowals such as “this scheme is legal” or “this is not a get rich scheme”?
  • Does the literature indicate the Commerce Commission or another government department or agency has endorsed the scheme?
  • Does the prospectus fail to share a street address so that you are unable to contact a person for further details?
  • Does the scheme offer ongoing training and sales support?




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