Pyramid Schemes and MLMs

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[{"type":"txt","id":"rich_1486383005463","data":" Money. Apart from being an amazing Pink Floyd song, it\u2019s a pretty good thing to have, apparently. That is in case our governments wants us to, but let\u2019s not talk about the that just yet. Being a country of a almost a billion and a half, we are bound to be in need of it at every stage of our lives. From buying that little plastic bubble blower to getting your own means of transportation, money sets your mental stability. <\/p>Talking about mental stability, let\u2019s specifically talk about the part of our lives where we are at the most matured and capable of making decisions. Our teens and early 20s. Okay, now that we\u2019ve agreed on the timeline, coming to the basic understanding that most between this age gap are students, money is a virtue and comfort few have. How does one fuel this need for money. The obvious choice is work, but who would want to employ a sophomore? Being the hasty generation we are, conventional methods of earning just don\u2019t cut it anymore. This is where the crux of the article comes in. MLMs or Multi Level Marketing Schemes, or just plain simple Pyramid schemes offer that quick buck and being so accepting of everyone who wants to be a part of it slowly have and are becoming an easy option for students. <\/p> Pyramid schemes or MLMs are not illegal in India. There is an abundance of evidence and first hand experience from participants who will vigorously argue on how vital these \u201cCorporations\u201d have been for them in leading a glamorous life. So let\u2019s build on that exact concept. The glamour, as a fruit of building a \u2018downline\u2019 as they call it, in the cheques they cash every month, right to the show room cars they\u2019ve booked before completing their bachelor\u2019s. Everything right in front of you. It couldn\u2019t all be wrong, could it? It is real. The money, the bikes, the cars, the trips that you see are real. All carefully rendered to motivate another customer to join the ranks. <\/p>This is an important part to the functioning of Pyramid schemes. The flair and pomp is not for the sake of it but holds a special purpose. It acts as a sign of financial stability and controlled funding. Most MLMs target vulnerabilities in the crowd. In terms of students, a bike, usually a flashy one. A tailored suit, glasses, and tiny details which usually go unnoticed but are vital to separate the ones in the system and the ones who are not. <\/p>What you don\u2019t see are the 60% who drop out of this structure in the first month. All you see are the ones who\u2019ve reeled in enough bait to float their boat. As rheotorical as that may sound, it is true. In order to be good at MLM you need to sustain the exponential growth. Growth which needs each person in the structure to further contribute a number of participants, let\u2019s say 5, to the downline. \nWell, according to basic mathematics, this 5-5 rule can only be achieved for an estimated 7-8 cycles before the entire population of the earth is exceeded. \nThink about that for a second. Now, each Corporation has it\u2019s own twist to this core model of marketing. Some don\u2019t directly ask for registrations but do so in terms of products or commodities sold\/bought during a certain interval of time. <\/p> \nThe most common mathematical bait used by these schemes is the idea of earning your money back by filling your quota of minimum additions. If you\u2019ve done the math on this, it becomes apparently simple. Just go out, get something like 9 people registered for the fee charged or products sold and lay back while the others do the work for you. At some point let us assume the chain is broken. For the sake of understanding, let it be the second wave of enrollments. Now that a complete array of oppurtunities have been excluded, there\u2019s the extra pressure of others in the link to deliver even more. \nBut where can someone get the numbers from? The obvious and sad part of this scheme is that it requires the victim\/participant to enroll his friends or family. Apart from the awkwardness of this transaction, there is a certain lack of ethics in asking your friends and family to grow your business. The simple idea behind it being you can trust them in building your reach. There\u2019s been an ample amount of research and statistical proof against the said practice. The idea of bossing someone you\u2019ve known for a long time, into doing work for you, in itself should direct the moral compass south. \n\nWith all this being said, how does one actually know if it\u2019s a Ponzi scheme?\nWell, some ways to know you are operating in a questionable business if there\u2019s: <\/p>1)\tNo physical product being exchanged for money- for example a pass or a login ID being issued for the fee paid. <\/p>2)\tNo refund policy on all products purchased or distributed. <\/p>3)\t No physical office of the parent company registered in the city or region. <\/p>4)\tProducts are unreasonably priced in comparison to usual competitive market pricings.<\/p> 5)\t Company policy towards taxes is dicey and not clear <\/p>But one thing is for certain. The ones employed to recruit are persistent to say the least. Constantly fuelled by the need to reach targets, they usually see compatriots as cattle. Like just another cog in the machine. An unsaid dimension to this persistence is the fact that at some point during every interaction they either have to lie to themselves or the ones they\u2019re trying to recruit. A lie that they\u2019re doing this for someone else, or the opportunity won\u2019t present itself like this often. That money won\u2019t be an issue anymore or that the earlier you get in the better off you will be in the future.\nNow the end part is true, although partly. A fundamental concept of pyramid schemes is that the one at the top will always end being the profiteer from every transaction or business done by company. At no point can a member of the 4th division be the biggest winner in doing hard work. Each arrangement has different bonuses or incentives to reaching a milestone. While some have levels, some have fancy names, and few others have power ties. Imagine working the hardest you\u2019ve ever done only to see the one directly above you in the chain take a bigger fruit. This is only partly true because you\u2019ll be way better off if you never even indulge in the fiasco that is MLMs.\n\nTheres a certain void in terms of the laws governing the legitimacy of these groups. Theres needs to be a stricter policy informing the public about the numbers behind such schemes. False advertising need to be addressed with scrutiny under the National Consumer code. But most importantly it is the duty of us as individuals to have an informed debate on the issue without just pushing the topic aside for being a bit controversial. <\/p>\n\nHave you been asked to become a part of such a ponzi scheme?\nHere\u2019s is a website to check the details about every such corporation registered under the Ministry Of Corporate Affairs:\nhttp:\/\/www.mca.gov.in\/MinistryV2\/index.html <\/p>1.\tScroll down to the \u2018I want to..\u2019 side tab on the left of your screen <\/p>2.\tClick on \u2018View Company or LLP Master Data\u2019 <\/p>3.\tClick on the search icon next the Company Name bubble <\/p>4.\tEnter the name of the company to check financial details and beneficiaries. <\/p> <\/p>\nBe informed before making your choice. Do not give into peer pressure. And most importantly, don\u2019t rush into making money. \n<\/p>"}]

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