What is the difference between a multilevel pyramided scheme and a legal network marketing company?
- I’ve received the same question every week in my meetings… It’s a very simple answer: a multilevel company turns into fraud when, according to the FTC ( Federal Trade Commission) companies like Streamlines; promotes itself as a multi-level marketing program selling dietary supplements and Health-care products… Your earnings in a pyramid scheme are derived primary from recruiting other participants into the program, not from the retail sales of products and services.
- Many examples of pyramid schemes are in the market, like this other one, SkyBiz, promoted its company work as home opportunity selling online tutorials, (now closed by FTC), to participate, consumer paid $25.00 registration fee and purchased an “e-commerce Web Pak”, which included two “Web sites” and access to online tutorials, for an additional $100. According to the FTC when consumers sign up to earn a commission check from recruiting, those fees paid by consumers went directly into the pockets of people higher up on the pyramid. Learn more on Facts: Pyramid Schemes
- On the other hand, there are too many good network marketing companies, people don’t receive commission from recruiting people, they actually get products or services. Learn more on Facts: Legal Multi-Level Marketing (MLM)
- A good network marketing & direct sale company example is Karatbars International GmbH a German Company, that is under an e commerce category, the customers open a savings gold account and they start buying from 1 gram of 24k pure gold, they receive their product (1 gram at a time) without any entry fee, no subscriptions and no purchase obligation, and your product is real Gold, and if the customer wants to participate in earning more for referring other saver accounts, they get paid, so you get paid for saving on a superior currency.
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