OT: Mutlilevel Marketing

Amway, Herbalife, and Mary Kay come to mind. Pyramid schemes are always around.

^ Yeah – those are established sales-force kinda companies that are well-known and pretty much legit AFAIK – this shit I'm hearing at the table across from me just sounds like a whole bunch of BS where they don't even actually sell a product – all I hear is about “if you have contacts and friends and get them to buy their cell or cables services thru you bla bla bla” and then “you also bring people into the biz you get a % of what they sell bla bla bla and you make a killing bla bla bla”.

No matter what the product, all these multi-level scams work the same. They make a big sale to a chump, who has to make a lot of small sales and can't do it.

When I was in my 20's, I had a "friend" who was involved in multi-level sales. He called it "selling people basements full of cosmetics."

“... I went to the Gold Club in Atlanta once not long before it closed. Amazing looking women in that place for sure. Wall to wall customers and wall to wall hot women! No club I have ever visited compared to the vibe there. ...”

I was not a TUSCLer back then so not too familiar w/ that club but I do recall hearing about the club and its trouble w/ LE and pro-athletes being involved.

Below is an article that sorta depicts what may have being going on w/ the Gold Club ATL:

ATLANTA, Georgia (CNN) -- Atlanta's Gold Club is one of the city's most prominent strip clubs, bringing in millions of dollars a year and attracting athletes, celebrities and other wealthy patrons.

Federal prosecutors allege that the club is also a front for prostitution, credit card fraud, money laundering and other crimes. In a sweeping racketeering indictment that reads like a crime novel, authorities allege that club owner Steve Kaplan and his associates had ties to the Gambino crime family.

Kaplan, along with a former dancer at the club and five others, is on trial at the federal courthouse in Atlanta.

Former club manager Thomas "Ziggy" Sicignano, one of the prosecution's star witnesses, testified that he arranged for dancers to have sex with a number of high-profile athletes, including former New York Knicks' basketball player John Starks.

The case has focused on allegations that Kaplan and trusted employees paid club dancers to have sex with athletes and other celebrities to raise the club's profile.

Prosecutors have said Terrell Davis of the NFL's Denver Broncos, Jamal Anderson of the NFL's Atlanta Falcons and Patrick Ewing of the NBA's New York Knicks will testify. In addition, at least two other basketball stars, Dikembe Mutombo of the Philadelphia 76ers and former NBA player Dennis Rodman, have been subpoenaed.

An attorney for Starks told CNN that Starks, if called to testify, would confirm he had sex with Gold Club strippers "a long time ago" before he "re-dedicated his life to Christ." Sicignano cut a plea deal with prosecutors, admitting to a felony charge of failing to turn over information to the government about a crime in exchange for his testimony. He testified Kaplan arranged for dancers to have sex with the players in private rooms at club, in the players' hotel rooms and even sent dancers to the Knicks' 1997 training camp in South Carolina to meet with players.

Toronto Raptors star Antonio Davis was also named in the testimony. He called the allegations against him "malicious lies" and has filed a $50 million defamation lawsuit against Sicignano. The defense argues that Sicignano was responsible for any prostitution that may have gone on in the club.

Steve Sadow, Kaplan's attorney, told jurors in his opening statement that the case was built on "lies and prejudice" from witnesses "bought and paid for" by the government. He called Kaplan a "legitimate, hard-working businessman."

The Gold Club charges were brought under the federal Racketeer Influenced and Corrupt Organizations (RICO) Act, the government's principal weapon against organized crime. A property seizure law, RICO was designed to attack Mafia-style organized crime, but its application has been broad. Prosecutors have used it to target a wide range of businesses, from adult video and book store owners to politicians and union leaders.

Prosecutors allege that Kaplan and his associates were involved in a wide-ranging criminal enterprise involving:

• Credit card fraud, for allegedly overcharging customers and adding huge, unauthorized, tips to their credit card bills. One customer allegedly was charged $24,000 in one visit.
• Failing to report earnings used to pay the Gambino crime family for protection.
• Bribing police.
• Bribing two Delta Airlines employees to get illegal discounts on airfare.
• Obstruction of justice.
• Extortion.

In addition to Kaplan, the defendants are:

• Michael "Mikey Scars" DiLeonardo, accused of extortion, money laundering and obstruction of justice. He is identified in the indictment as a captain in the Gambino crime family, though he has never been convicted of a crime.
• Norbert Calder, the club's general manager, accused of allowing prostitution and illegal drug use at the club.
• Roy Cicola, a club assistant manager, accused of allowing prostitution at the club.
• Reginald Burney, a former Atlanta police officer, accused of tipping off club management about pending city inspections.
• Larry Gleit, an accountant accused of credit card fraud, money laundering and obstruction of justice.
• Jacklyn Bush, stage name "Diva," accused of prostitution.

All of the defendants have denied the charges and Kaplan is paying for their defense. Kaplan's attorneys have said that he knew nothing about sales of sex or drugs at the club.

edition.cnn.com

damn - copied pasted the wrong stuff above - sorry

I was hoping someone would be familiar w/ this particular one and explain it b/c I've overheard it more than a few times.

Multilevel marketing is a sickness. Don't leave yourself open to it.

If people really want to be in business, then they should first apply for a job and learn about the business, and then try to start their own.

M L M's are not real business opportunities. They are scams and they are also fraud.

In some parts of the country unions are strong. But in other places MLM's and Born Again Christianity are strong. MLM's and Born Again Christianity operate of a similar logic.

SJG sites.google.com

^^^^^ so exactly how many crates of Amway are you stuck with in your basement?

i don't think i am going out on too much of a limb here but i’d be willing to bet that the anger you have towards your ex-mail order bride goes much deeper than just her getting into YOUR stash of weed. now be honest with us san_jose_guy. did she laugh at you when you signed up to sell Amway?

Actually a couple of weeks ago, someone tried to sell me on this. They say doing it you can retire in 2-5 years with a cash flow still coming in when you're retired. Sounds like bullshit to me.

There's some debate whether the company Tupperware is a MLM company. They use MLM techniques but management uses "direct to consumer". They want to disassociate themselves from the negative term MLM.

But they make damn fine products. I'm using my mom's hand-me-downs from the 60's and 70's. I have the same plastic pitcher and set of glasses now I used at home in high school. No kidding.

Many of these scams are promoted through churches as religious people tend to trust one another (unlike strip club customers). Tupperware and Avon are legit if useless but these modern scams are all the same. Some end in young girls begging at highway off ramps or selling worthless magazine subscriptions out of a van. Barnum was right.

Look, you all are so wrong. Just send me a couple of hundred and I'll show you how you can have thousands rolling in to you every week!

MLM is always bullshit because they are using the supposed business opportunity to sell the product. If someone really wanted to be in business, they would learn the field first.

The line is always internal consumption, how much is being bought by the downlines, versus real customers.

I have worked with Calif State Regulators to try and close down a financial services pyramid scam.

And no, I would never be dumb enough to be involved in such a thing myself. But I do know people who have been effected by it.

SJG

And also @Dougster's financial advice and the industry he claims to represent are not actually that far from a pyramid scam / Ponzi scheme.

Legal disclaimer, I am not aware of @Dougster or anyone he works with ever having been charged. Rather I am simply stating my own view of the situation.

SJG sites.google.com

Papi has a system for getting OTSB from the barristas. He also can recommend the best antiseptic ointment for the scratches from their piercings.

The FTC has just shut down one company using MLM marketing.

finance.yahoo.com

MLM scams have been around for decades and it is always the same. First they spend a ton of time outlining how much money can be made, softening up the heads of the usuaLly simple audience members. Then they breeze through a light piece on how wonderful their products are. But then, the best part is when they convince people that they can earn mega bucks by developing sales networks and earning off of what OTHER people sell.

Of course, the reality is that the products in question are much tougher to sell directly than advertised. So many of these MLM companies earn a substantial portion of their revenues from start up fees rather than profits on product sales.

Most of the time the products are only saleable to persons interested in the "business opportunity". So the products usually are conjured up with an inordinate appeal to novelty, rather than to utility and economic value.

MLM is a euphemism for Pyramid Scam. Pyramid Scams are an adaptation of Carlo Ponzi's scheme.

Originally it was supposed to be something to do with reselling international postage coupons. Not exactly ethical, but still it never worked out. So it turned into paying old investors with money from new investors. When it crashed it took down a medium sized New Jersey bank.

Ponzi said it was legal. Finally the US Supreme Court decided that it was criminal fraud. Their decision was written by Chief Justice and former President William Howard Taft. Besides imprisoning Ponzi, They also voided his 20 year old naturalized citizenship and then deported him. At first Ponzi ended up working for Mussolini. Then finally he died bankrupt and sick in South America.

The legal issue in dealing with Pyramid Scams is to prove that they are fraud, no real business, just an endless chain of recruiting.

Outstanding Book: amazon.com

But, this book is timid, they only denounce scams when there has already been a court decision against them.

Many, including myself, claim that our present financial markets are really just a Ponzi scheme.

Douglass Rushkoff explains that he decided to write about Judaism instead of his usual field, media, because he did not want to support the dotcom boom, as that was simply the biggest Ponzi scheme of all time, and using the Nasdaq stock market.

amazon.com

In the years since, the situation has only gotten worse.

The first big Pyramid Scam was Amway, and that was started by Pentecostals. You can see how the thinking in these things is very similar to what you find in Pentecostalism. In the areas of the country where Pentecostalism is strong, Pyramid Scams are strong. And in the other areas of the country it is working people and labor unions which are respected.

Anytime I get to speak with those involved in unions, I always tell them that the threat to the rights of working people is Born Again Christianity.

SJG sites.google.com

Bad Company, Wembley youtube.com

isn’t the illegal drug trade from production, distribution, wholesale and retail sales all based on multi-level marketing? seems to me that it is a highly efficient, adaptable and profitable MLM operation.

well it is highly profitable for everyone except the losers like san_jose_guy who use their own products.

The illegal drug trade works that way because it is illegal. Otherwise such drugs would be distributed just like ordinary stuff is.

MLM's are not efficient at all. The ones which are competing against the standard retail sales model usually have products which are over priced and with an excessive emphasis on novelty. Usually the only real business there is an endless chain of recruiting. This is how the FTC is able to bring court cases and get fraud judgments.

SJG

^^^^^ smoked all your profits didn't you? an all too common story....

@DoctorPhil, What are you high on now?

SJG