How to Avoid Pyramid Schemes
There are legitimate ways to achieve wealth, but getting involved in pyramid schemes is not one of them. These are marketing frauds in which a person is "hired" as a distributor for a specific product or franchise. Success depends on recruiting other distributors. If you don't avoid these scams, chances are you'll be left frustrated and poorer than when you started.
Other People Are Reading
Instructions
-
-
1
Beware of any scheme that requires you to invest money in a franchise that gives you commissions for recruiting other distributors. Any "job" that depends on your making money based on how many people you sign up is most likely a pyramid scheme and should be avoided.
-
2
Avoid any plan that requires you to spend money on high-priced products offered by the company which hires you. Make sure that keeping inventory of these products, beyond necessary items such as order forms or catalogs, is not a requirement.
-
-
3
Find out if the plan involves a training program. Legitimate companies offer training materials and classes. If the plan involves simply being handed a "kit" and having you start on your own, it most likely falls under a pyramid scheme.
-
4
Take your time when making a decision about getting involved in a plan. Do not be pressured into making an instant decision. Research the company involved before signing a contract, if one is offered.
-
5
Check with the Better Business Bureau and your state attorney general's office about the company offering this plan. If it sounds too good to be true, it usually is.
-
1
Tips & Warnings
Not all multilevel marketing plans are pyramid schemes. If the products being offered are legitimate and the company is paying commissions on the goods you sell as well as on those sold by people you have recruited, it is a legitimate plan.
Pyramid schemes are illegal and violate federal and state laws. Do not get involved in any pyramid scheme.
Avoid a company offering only one product. Diversification is important.
