Multi-Level Marketing (MLM) Scams

Back in Amway days multi-level marketing used to be somewhat respectable but now almost all the remaining MLM programs are scams

Many, if not all, of today's multilevel marketing programs involve some degree of fraud. Either they promise sales and incomes that can never be achieved or they are nothing more than pyramid schemes crudely disguides as multilevel marketing or MLM programs. When your profit derives from recruiting other people into the program then you are involved in what's known as a pyramid scheme. This is bad in two ways. Not only will you lose any funds you pour into this business but it's illegal as well and you could face steep fines or worse.

What's important to understand is that pyramid schemes always collapse in the end. No amount of fast talking will ever change that. Making money by signing up new members who make money by signing up new members is not a business plan with a future.

Deception is a primary tool

But even the multi-level marketing programs that are not pyramid schemes use deception to lure the unsuspecting and con them into becoming distributors. Somepromise outrageous incomes and some multilevel marketing schemes simply involve products of dubious value to consumers. The dietary supplement MLM programs are an excellent example of this. If you have to exaggerate or even lie to consumers in order to make a sale you might want to think twice about involving yourself in the distribution of a programs products. If you think that what you're selling or distributing is worthless then why should anyone else think differently?

Investigate the Company on the Web

While we could argue that all multilevel marketing plans should be avoided we can't simply dismiss them all as scams without investigating them individually. But we do think that the track record for multilevel marketing programs is poor enough that everyone should be extremely skeptical of anyone attempting to sign you up as a distributor. Make sure that you research a MLM plan thoroughly before any money changes hands or you make any commitment. A few minutes of research is usually all you need thanks to the world wide web. Since most of the multilevel marketing scams use more or less the same techniques we are going to simply list some of the most common. See if the program you are interested in can hold up against our multilevel marketing scam identifiers.

Multilevel Marketing Scam Warning Signs

Here are some warning signs that a multilevel marketing program is a scam or pyramid scheme:

• You make money by signing up new members- If this were a health club you would be in the clear but if the members you sign up make money by recruiting still more members you have a real problem
  
  
• You aren't selling a good product- If there is an item for sale in this MLM plan make sure it's a nice piece of merchandise that people might actually like. If it's a piece of garbage that only a fool would purchase if they only knew the truth about it then you should steer clear because good businesses sell good products. There isn't much positive word-of-mouth advertising for something utterly useless. What kind of repeat business do you expect to get from selling this stuff? Believing in what you are doing not only feels better but your chances of success are probably greater.
  
  
• You are selling to distributors- Aren't you a distributor, too? What kind of money is going to be made when a bunch of distributors are selling products back and forth to each other? It sounds more like some kind of shell game than a business. If you aren't actually making the product being sold then you need to be selling it to the people that will use it.
  
  
• You are promised a high income- This is just not a promise that a legitimate business can make to anyone. Almost anyone can makesomemoney through multilevel marketing but any serious income is going to require both a lot of time and a tremendous amount of work. Any kind of promise should be viewed skeptically. Most people making money from multilevel marketing think of it as a part-time job and very, very few are ever successful enough at it to do it full time. Instant success and high earnings are almost impossible so if you are promised either of those you should question the legitimacy of the program.
  
  
• You can succeed if you work part-time- Multilevel marketing is ultimately like any business whether you do it out of your home or your office. That means that if you don't invest a lot of time and effort into it you won't get anywhere and you certainly won't make any money worth talking about. Not only that but the very nature of multilevel marketing means that every hour of every day is spent trying to find customers since every personal relationship and everyone you come into contact with is a potential customer. That doesn't sound very part-time to me. This is just a common lie told to get you interested. Multilevel marketers never have days off because to be successful at it means working 24/7 and even then you might not succeed.
• Questions:
• 1 .  How often do you see commercials or advertising that you consider a MLM scam?
• 2.  Why do think people fall prey to these scams?
• 3.  How do you end up making money in these type of situations?  Be specific to "make money"?
• 4.  List three products or advertisments that you have recently seen.