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In Reply to: To Joseph - on Excel posted by Acheick on August 11, 2002 at 08:07:49:
There are a buch of them out there, and new ones being invented every day.
One thing I should point out is that these organizations are legal. The reason they are legal is that a product or service actually changes hands. If there is no product or service (only money) then it is a classic illegal pyramid (Ponzi) Scheme.
A while back there was this company that went by some guy's name (A.L. Williams... or something like that). The idea was to get your friends and relatives to cash out of their cash value life insurance policies and buy term insurance and an IRA account from the company. The only problem was that they took housewives and 7-11 clerks and with no real money training tried to turn them into financial consultants. I remember walking out of Sam's Club one afternoon to be accosted by a woman at the door who asked if I had a Whole Life policy. When I said I did, she launched into a pitch about how I was being ripped off.
I'm not sure how I would feel about it today had I listened to her, and my life insurance had been replaced by a stock invested IRA account. The fact is, my whole life policy is worth more than it was last year, and my IRA is NOT. Thank God I can at least afford to die.
I'm sure that nice lady is back at the laundromat dreaming about getting a Pink Cadillac from Mary Kay.
The fact is, these organizations prey on those who feel hopeless and helpless. They suck what little money they can out of these people, and move on to the next, using their trusted friends and relatives to unwittingly do the dirty work.
Some aren't as bad as others. Jane was an Avon lady in recent years (note: was). Avon still has MLM aspects, but it has a focus on retail sales. Avon has a good, well respected product to sell, and signing up other distributors under you seems to take a back seat. That really seems to be the warning sign. When most of the goal is to sign up people under you, it almost always ends up bad. That is probably a sign that the product really isn't worth selling, and is simply a decoy to cover up a pyramid scheme where the only people making money are at the top.
