Scam Alert! Multilevel Marketing and Pyramid Schemes

September 18th, 2017 - 2:15pm

Scammers often use lines like: “Looking for a job or to earn extra income? Ever thought about starting your own business?” Buying into a business opportunity that makes big claims about what you can earn might sound like the answer, but if it sounds too good to be true it probably is.
There are many multilevel marketing companies out there; some are illegal pyramid schemes. Others are legal, but they sell products to the public by way of word-of-mouth and rely on recruited employees to recruit others.
If you are considering buying into a multilevel marketing plan, get the details and do your homework.

  • Consider the Products: Some offer goods that are overpriced so they can afford to pay commissions to multiple people in the chain.
  • Learn More About the Company: Find and study the online information about the company’s track record. Read about complaints.
  • Evaluate the Plan: Do not quickly pay, sign a contract, or give your social security number. Take time to think over your decision. Avoid any plan where the reward for recruiting new distributors is more than it is for selling products to the public.
  • Ask questions: Dig for details. Your money is hard earned. Be wary of business schemes that focus on separating you from your money with big promises.

The Federal Trade Commission is the nation’s consumer protection agency and further information on multilevel marketing can be found online at: