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Pyramid Scams

Pyramid schemes come and go on the internet; there will be periods of time when they're about as thick underfoot as sand on the beach. Then they'll disappear for awhile, and then they'll come back again in full force.

Not too surprising, I suppose. After a few versions of some pyramid schemes have made the rounds, and people discover that they invested money and didn't get anything in return, so they stop forwarding the scams for awhile. Then, eventually, there are enough new "suckers" that they can get started again.

How does a pyramid scam work? The author of the scam invents some "product" that he wants to sell. This product can be something as simple as a one page report explaining how multilevel marketing works. It's important that there be some sort of "product" (even if it's completely stupid and pointless) because if there is no product, the whole scheme violates laws that state product or service must be exchanged for money.

Now, the idea is that you sell the product to ten different people, and you get money from them. But then, when each of them sells the product, you get a percentage of each of those sales as well. And then you get a percentage of the sales that those people make as well. This is why it is called "pyramid" or "multilevel", because the "base" is supposed to get wider and wider, like a pyramid, and for each "level" of the consumer base, you receive money.

What's the problem with this? Well, the big problem is that the scheme never lasts long enough to make money for anyone but the people at the very top of the pyramid to get any money from the scheme. For everyone else, by the time they get involved, there aren't enough "gullible" people left to make them any money. So everyone loses out except the very first people to get involved (in other words, the person who started it and his immediate friends and family!)

The pyramid scheme is exactly backwards from every other business we look at. Typically, when you read about a business opportunity, one of the very first things you want to know is "How long has this business been around?" Because the longer it's been around, the more "secure" and "reliable" it is. But with a pyramid scheme, if it's been around for a long time, that means that there are already way to many "layers" of people, and not enough "gullibles" left.

Ironic, isn't it?

Now, there are pyramid/multilevel marketing schemes that actually do offer legitimate products, but you need to think through these very carefully before you get involved. Analyze the product, and try to honestly evaluate whether you - or anyone else you know - would actually purchase the product, even if there was no hope of making money from it.

Be careful about getting involved in pyramid schemes! The odds of you making any money are far less than you realize!

Pyramid Scam Sample

Please read the entire email before you delete thinking it's another junk. The very same email helped me make $8995 bucks in a week from the time I sent my first email. Just follow the instructions. You are guranteed to get hard cash within a week.


Does this headline look familiar? Of course it does. You most likely have just seen this story recently featured on a major nightly news program (USA). And reported elsewhere in the world (including my neck of the weeks New Zealand). His mother was cleaning and putting laundry away when she came across a large brown paper bag that was suspiciously buried beneath some clothes and a skateboard in the back of her 15-year-old sons closet. Nothing could have prepared her for the shock she got when she opened that bag and found it was full of cash. Five-dollar bills, twenties, fifties and hundred's all neatly rubber-banded in labeled piles.

My first thought was that he had robbed a bank, says the 41-year-old woman, There was over $71,000 dollars in that bag that's more than my husband earns in a year.

The woman immediately called her husband at the car- dealership where he worked to tell him what she had discovered. He came home right away and they drove together to the boy's school and picked him up. Little did they suspect that where the money came from was more shocking than actually finding it in the closet?

As it turns out, the boy had been sending out, via e-mail, a type of Report to e-mail addresses that he obtained off the Internet. Everyday after school for the past 2 months, he had been doing this right on his computer in his bedroom.

I just got the e-mail one day and I figured what the heck, I put my name on it like the instructions said and I started sending it out, says the clever 15-year-old. The e-mail letter listed 5 addresses and contained instructions to send one $5 dollar bill to each person on the list, then delete the address at the top and move the others addresses down, and finally to add your name to the top of the list.

The letter goes on to state that you would receive several thousand dollars in five-dollar bills within 2 weeks if you sent out the letter with your name at the top of the 5-address list. I get junk e-mail all the time, and really did not think it was going to work, the boy continues.

Within the first few days of sending out the e-mail, the Post Office Box that his parent had gotten him for his video-game magazine subscriptions began to fill up with not magazines, but envelopes containing $5 bills.

About a week later I rode [my bike] down to the post office and my box had 1 magazine and about 300 envelops stuffed in it. There was also a yellow slip that said I had to go up the [post office] counter.

I thought I was in trouble or something (laughs). He goes on, I went up to the counter and they had a whole box of more mail for me. I had to ride back home and empty out my backpack because I could not carry it all.

Over the next few weeks, the boy continued sending out the e-mail. The money just kept coming in and I just kept sorting it and stashing it in the closet, barely had time for my homework. He had also been riding his bike to several of the banks in his area and exchanging the $5 bills for twenties, fifties and hundreds.

I didn't want the banks to get suspicious so I kept riding to different banks with like five thousand at a time in my backpack. I would usually tell the lady at the bank counter that my dad had sent me in to exchange the money and he was outside waiting for me. One time the lady gave me a really strange look and told me that she would not be able to do it for me and my dad would have to come in and do it, but I just rode to the next bank down the street (laughs).

Surprisingly, the boy did not have any reason to be afraid. The reporting news team examined and investigated the so-called chain-letter the boy was sending out and found that it was not a chain-letter at all. In fact, it was completely legal according to U.S. Postal and Lottery Laws, Title 18, Section 1302 and 1341, or Title 18, Section 3005 in the U.S. code, also in the code of federal regulations, Volume 16, Sections 255 and 436, which state a product or service must be exchanged for money received.

Every five-dollar bill that he received contained a little note that read, Please send me report number XYZ. This simple note made the letter legal because he was exchanging a service (a report on how-to) for a five- dollar fee.

This is the end of the media release. If you would like to understand how the system works and get your $71,000 please continue reading. What appears below is what the 15 year old was sending out on the net you could use it too- just follow the simple instructions.

BE FINANCIALLY FREE LIKE OTHERS WITHIN A YEAR!!! Before you say, Bull, please read the following. This is the letter you have been hearing about on the news lately. Due to the popularity of this letter on the Internet, a national weekly news program recently devoted an entire show to the investigation of this program described below, to see if it really can make people money. The show also investigated whether or not the program was legal. Their finding proved once and for all that there are absolutely No Laws prohibiting the participation in the program and if people can follow the simple instructions, they are bound to make some megabucks with only $25 out of pocket cost.