Pyramid Schemes

By: Michelle Butts

How does Pyramid Schemes work?

Participants attempt to make money solely by recruiting new participants

  • No genuine product or service is actually sold

Who does the scam target?

The scam targets New participants

Who will be hurt?

The company when it eventually collapses will be hurt and all investors lose their money

What makes it believable?

Pyramid scheme promoter may go to great lengths to make the program look like a business, such as a legitimate multi-level marketing program

Do you think the average person would fall for this scam?

I do think the average person would fall for this scam for many reasons.

  • Most people do not know what they are actually signing up for
  • Some people misunderstand the situation they are in while dealing with scams
  • The company finds a way to draw participants in the scam. Most likely the participants will fall for it.

What emotion does the scam depend on?

The scam depends on people who are desperate and want to participates. People may also join because of their friends. That is an example of a follower.The company also depends on people not knowing what they are doing to get them to join.

What are some of the Hallmark schemes?

  • Promises of high returns in a short period of time- Be skeptical of promises of fast cash-it could mean that commissions are being paid out of money from new recruits than revenue generated by product sales.
  • Easy money or passive income - there is no such thing as a free lunch. If you are offered compensation in exchange for doing little work such as making payments,recruiting others, or placing online advertisements on obscure websites, you may be part of an illegal pyramid scheme.

Why do pyramid Schemes end up collapsing?

Pyramid schemes end up collapsing when not getting enough new participants

Do you feel you are a victim of a scam or scheme?

  1. Call 614-999-8888
  2. go to the website