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Nothing much to do with Pyramids, more related to Chain Letters

Also see Get Rich Schemes

Pyramid Schemes
What they are, how they work, and how to beware of them! The whole thing explained...


You might sooner or later receive a message offering you a business opportunity which is a Pyramid Scheme. You will be offered the chance of making a huge amount of money, and the method is detailed in an explanation. If you think about it a bit, it may seem plausible. Plus, there are ways of making a fortune, but there is a problem with pyramid schemes and I will explain why, after I've explained what a pyramid scheme is.

WHAT IS A PYRAMID SCHEME?

You have to pay a small sum to someone first. This is sometimes connected with a deal involving signing up with some kind of money e-mailing company or sometimes it's a matter of sending cash. You pay the money to Person1 on the list. The list has three (or more) people on it, and then you move everyone along the list by one, put your own name on the list, and wait for the money to come rolling in. The letter will tell you that this is a sure way for everyone to make a fortune, and the explanation seems convincing. After all, if you have been convinced by it and sent the money, others will, so sooner or later an increasingly large number of people will be paying YOU money. So, brilliant, eh?

WHAT'S WRONG WITH PYRAMID SCHEMES?

Well, let's not knock an idea just because it promises to make a fortune. That would be ignorant, as there ARE ways to make a fortune, some of which have not been discovered. It pays to not be too sceptical! Also, with pyramid schemes, SOME people WILL make a fortune. So, what's wrong with pyramid schemes and why should you avoid them? The problem is the mathematics, which can be explained logically and the problem exposed. You don't need Advanced Level Exam mathematics to see this, but O-level helps. Part of the trouble is that the purveyors of pyramid schemes will try to distract you from the mathematical fault. Here, as clearly as can be explained, is the fault: For every person in the scheme who makes money, a preset number (n) will have to pay out money. For any level of the scheme, an ever-increasing next-level will be required. So, even though YOU might make money, sooner or later a lot of people will be sold a deal which will LOSE MONEY. So, you might make money, but others will lose. The problem is that it is very likely that this over-the-hill point has already occurred, so YOU will LOSE MONEY! If this sounds too complex to understand, a simpler explanation is this: As no money is being actually generated and it's just being moved about, there is no real money to be made, at least not long term, by everyone.

So, to sum it up, although a few people may get rich, the chances are it won't be you. Furthermore, whether you make money or not, a very large number of other people will lose money. It's a mathematical fact about the system.

The reason why pyramid schemes fool a lot of people into paying money into them is because, like the Impossible Triangle, it looks convincing from any angle. Most people aren't clever enough to suss out the whole picture and see the fundamental fault in it.

Pyramids schemes are illegal in some countries and not in some other countries, but it's largely irrelevant. People should be educated about the hazards and should not need to be protected by law against folly.

Pyramid schemes are sometimes disguised as MLM / Multi-Level Marketing, and often appear in the background as a sales method for a real product. So, when the whole thing collapses you may end up with a load of soap or some reports or some such thing; well it's better than nothing. However, for any scheme, you should check how much of it is about a real product and how much of it is just blather.

Also, when considering any testimonials, it's worth noting that these are likely to be TRUE. People really DO make money out of pyramid schemes. However, the same is true of gambling, there will be some winners who will have made a fortune on the gambling and be able to speak well of a MIRACLE, and yet you know that a lot of people will have lost and not said anything.

The fact is though, that you are extremely unlikely to make any money out of a pyramid scheme. The people who generally win are those who start the pyramid scheme in the first place. This is best avoided too, for various reasons!

Anyway, here is an e-mail which is typical of a multi-level-marketing approach, and is presented here without prejudice, for information only, and shall not be construed in any way to be anything whatsoever etc etc...

(personal info has been edited out just in case the addresses were genuine)


Removal Instructions are at the bottom of this e-mail

Dear Friend, I'm going to the Marquesas with the money I earn from this.   
 
 A recent survey by Nielsen/Netratings says that "The Internet
population is rapidly approaching a 'Half a Billion' People!"   
 
SO WHAT DOES ALL THIS MEAN TO YOU?
 
 Let's assume that every person has only one E-mail address ...
that's 500 million potential customers and growing! In addition,
E-mail is without question the most powerful method of distributing
information on the face of the earth.
 Well, I think you get the picture. The numbers and potential are
just staggering, but it gets even better ...
 
Suppose I told you that you could start your own E-mail business
today and enjoy these benefits:
 
  *** All Customers Pay You In Cash!!!
  *** You Will Sell A Product Which Costs Nothing to Produce!
  *** Your Only Overhead is Your Time!
  *** You Have 100s of Millions of Potential Customers!!!
  *** You Get Detailed, Easy to Follow Startup Instructions!
 
     AND THIS IS JUST THE TIP OF THE ICEBERG ...
As you read on you'll discover how a 'Seen on National TV'
program is paying out a half million dollars, every 4 to 5 months
from your home, for an investment of only $25 US Dollars expense,
one time. ALL THANKS TO THE COMPUTER AGE ... AND THE INTERNET!
 
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 findings 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 mega bucks with only $25 out of
pocket cost".
 
  DUE TO THE RECENT INCREASE OF POPULARITY & RESPECT
  THIS PROGRAM HAS ATTAINED, IT IS CURRENTLY WORKING
  BETTER THAN EVER.
 
***** This is what one had to say:
 
"Thanks to this profitable opportunity. I was approached many
times before but each time I passed on it. I am so glad I
finally joined just to see what one could expect in return
for the minimal effort and money required. To my astonishment,
I received total $ 610,470.00 in 21 weeks, with money still
coming in".
 
       Pam Hedland, Fort Lee, New Jersey.
--------------------------------------------------------
   Here is another testimonial:
 
"This program has been around for a long time but I never
believed in it.  But one day when I received this again in
the mail I decided to gamble my $25 on it. I followed the
simple instructions and walaa..... 3 weeks later the money
started to come in. First month I only made $240.00 but the
next 2 months after that I made a total of $290,000.00.
So far, in the past 8 months by re-entering the program, I
have made over $710,000.00 and I am playing it again.
 
The key to success in this program is to follow the simple
steps and NOT change anything."
 
  More testimonials later but first:
 
  ****** PRINT THIS NOW FOR YOUR FUTURE REFERENCE ******
 
If you would like to make at least $500,000 every 4 to 5
months easily and comfortably, please read the following ...
THEN READ IT AGAIN and AGAIN!!!
 
***** FOLLOW THESE SIMPLE INSTRUCTIONS,
      TO MAKE YOUR FINANCIAL DREAMS TRUE! *****
 
INSTRUCTIONS:
------------
**** Order all 5 reports shown on the list below.
 
**** For each report, send $5 U.S. CASH, THE NAME & NUMBER
OF THE REPORT YOU ARE ORDERING and YOUR E-MAIL ADDRESS to
the person whose name appears ON THAT LIST next to the report.
 
  MAKE SURE YOUR RETURN ADDRESS IS ON YOUR ENVELOPE
  TOP LEFT CORNER in case of any mail problems.
 
  **** When you place your order, make sure
       you order each of the 5 reports ****
 
You will need all 5 reports so that you can save them on your
computer and resell them.
 
YOUR TOTAL COST $5 X 5 = $25.00.
 
*********Within a few days you will receive, via e-mail, each
of the 5 reports from these 5 different individuals. Save
them on your computer so they will be accessible for you to
send to the 1,000's of people who will order them from you.
Also make a floppy of these reports and keep it at your desk
in case something happens to your computer.
 
**********IMPORTANT - DO NOT alter the names of the people
who are listed next to each report, or their sequence on the
list, in any way other than what is instructed below in steps
1 through 6 or you will loose out on majority of your profits.
Once you understand the way this works, you will also see how
it does not work if you change it.
 
Remember, this method has been tested, and if you alter,
it will NOT work!!!
 
People have tried to put their friends/relatives names on
all five thinking they could get all the money. But it does
not work this way. Believe us, we all have tried to be greedy
and then nothing happened.
 
So do not try to change anything other than what is instructed.
Because if you do, it will not work for you.  Remember,
honesty reaps the reward!!!
 
1. After you have ordered all 5 reports, take this
advertisement and REMOVE the name & address of the person in
REPORT # 5. This person has made it through the cycle and is
no doubt counting their fortune.
 
2. Move the name & address in REPORT # 4 down TO REPORT # 5.
3. Move the name & address in REPORT # 3 down TO REPORT # 4.
4. Move the name & address in REPORT # 2 down TO REPORT # 3.
5. Move the name & address in REPORT # 1 down TO REPORT # 2.
6. Insert YOUR name & address in the REPORT # 1 Position.
 
PLEASE MAKE SURE you copy every name & address ACCURATELY!
=========================================================
 
Take this entire letter, with the modified list of names,
and save it on your computer. DO NOT MAKE ANY OTHER CHANGES.
Save this on a disk as well just in case if you loose any
data.
 
To assist you with marketing your business on the Internet,
the 5 reports you purchase will provide you with invaluable
marketing information that includes: How to send bulk e-mails
legally, Where to find thousands of free classified ads and
much, much more.
 
There are 2 Primary methods to get this venture going:
 
  METHOD # 1: SENDING BULK E-MAIL LEGALLY
  =======================================
Let's say that you decide to start small, just to see how
it goes, and we will assume you and those involved send out
only 5,000 e-mails each.  Let's also assume that the mailing
receive only a 0.2% response (the response could be much
better but lets just say it is only 0.2%. Also, many people
will send out hundreds of thousands e-mails instead of only
5,000 each).
 
Continuing with this example, you send out only 5,000 e-mails.
With a 0.2% response, that is only 10 orders for report #1.
Those 10 people responded by sending out 5,000 e-mail each
for a total of 50,000.  Out of those 50,000 e-mails only 0.2%
responded with orders.  That's = 100 people responded and
ordered Report #2. Those 100 people mail out 5,000 e-mails
each for a total of 500,000 e-mails.  The 0.2% response to
that is 1000 orders for Report #3.
 
Those 1000 people send out 5,000 e-mails each for a total of
5 million e-mails sent out.  The 0.2% response to that is
10,000 orders for Report #4.  Those 10,000 people send out
5,000 e-mails each for a total of 50,000,000 (50 million)
Emails.  The 0.2% response to that is 100,000 orders for
Report #5.
 
THAT'S 100,000 ORDERS TIMES $5 EACH = $500,000.00 (a half
million).
 
  Your total income in this example is:
  1..... $50 +
  2..... $500 +
  3..... $5,000 +
  4..... $50,000 +
  5..... $500,000 ......... Grand Total = $555,550.00
 
  NUMBERS DO NOT LIE.  GET A PENCIL & PAPER AND FIGURE OUT
  THE WORST POSSIBLE RESPONSES AND NO MATTER HOW YOU
  CALCULATE IT, YOU WILL STILL MAKE A LOT OF MONEY!
-----------------------------------------------------------
  REMEMBER FRIEND, THIS IS ASSUMING ONLY 10 PEOPLE
  ORDERING OUT OF 5,000 PEOPLE YOU MAILED.
 
Dare to think for a moment what would happen if everyone,
or 1/2, or even one 1/5 of those people mailed 100,000 e-mails
each or more?  There are over 250 million people on the
Internet worldwide and counting.  Believe me, many people
will do just that, and more!
 
  METHOD # 2: PLACING FREE ADS ON THE INTERNET
  ===================================================
Advertising on the net is very, very inexpensive and there
are hundreds of FREE places to advertise.  Placing a lot of
free ads on the Internet will easily get a larger response.
We strongly suggest you start with Method # 1 and add METHOD
# 2 as you go along.
 
For every $5 you receive, all you must do is e-mail them the
Report they ordered.  That's it!  Always provide same day
service on all orders. This will guarantee that the emails
they send out, with your name and address on it, will be
prompt because they can not advertise until they receive the
report.
 
  ORDER EACH REPORT BY ITS NUMBER & NAME ONLY.
 
Note:  Always send $5 cash (U.S. CURRENCY) for each Report.
Checks are NOT accepted.  Make sure the cash is wrapped in
at least 2 sheets of paper before you put it in the envelope.
On one of those sheets of paper, write the NUMBER and the NAME
of the Report you are ordering, your email ADDRESS, your NAME
and postal address. Make sure you affix proper 'International'
Postage if ordering a report from outside your country.
 
  PLACE YOUR ORDER FOR THESE REPORTS NOW:
===================================================
 
Report #1: The Insider's Guide to Advertising for Free on
the Net ... Order Report #1 from:
 
X.X.X
NNN. address
Alberta
Canada
000-000
________________________________________________________
 
REPORT #2: The Insider's Guide to Sending Bulk e-mail on
the Net ... Order Report #2 from:
 
Q.Q.Q.
1234 address
#NNN
Ventura, CA  00000
___________________________________________________
 
REPORT #3: Secret to Multilevel marketing on the Net
Order Report #3 from:
 
A. Name Here
PO BOX nnnn
Ventura, California
0000-0000
 
________________________________________________________
 
REPORT #4: How to become a millionaire utilizing MLM &
the Net ... Order Report #4 from:
 
A. Person
A Convincing address
Somewhere, ON
Canada
000 000
 
________________________________________________________
 
REPORT #5: How to send out One Million emails and Jump Start
your Business...
Order Report #5 From:
 
X.X.
nnn Somewhere Ave
Toronto, Ontario, zip-code
Canada
________________________________________________________
 
There are currently almost 500,000,000 people online
worldwide!
 
  $$$$$$$$$ YOUR SUCCESS GUIDELINES $$$$$$$$$$$
 
Follow these guidelines to guarantee your success:
*************************************************
If you do not receive at least 10 orders for Report #1 within
2 weeks, continue sending e-mails until you do.
 
After you have received 10 orders, 2 to 3 weeks after that
you should receive 100 orders or more for Report #2.  If you
did not, continue advertising or sending e-mails until you do.
 
Once you have received 100 or more orders for Report #2, YOU
CAN RELAX, because the system is already working for you,
and the cash will continue to roll in!
 
THIS IS IMPORTANT TO REMEMBER: Every time your name is moved
down on the list, you are placed in front of a different report.
 
You can KEEP TRACK of your PROGRESS by watching which report
people are ordering from you.
 
  IF YOU WANT TO GENERATE MORE INCOME SEND ANOTHER BATCH OF
E-MAILS AND START THE WHOLE PROCESS AGAIN. There is NO LIMIT
to the income you can generate from this business!!!
  ____________________________________________________
 
  FOLLOWING IS A NOTE FROM THE ORIGINATOR OF THIS PROGRAM:
 
You have just received information that can give you financial
freedom for the rest of your life, with NO RISK and JUST A
LITTLE BIT OF EFFORT.  You can make more money in the next
few weeks and months than you have ever imagined.
 
Follow the program EXACTLY AS INSTRUCTED. Do not change it
in any way.  It works exceedingly well as it is now.
Remember to e-mail a copy of this exciting report after you
have put your name and address in Report #1 and moved others
to #2...........# 5 as instructed above.  One of the people
you send this to may send out 100,000 or more e-mails and your
name will be on every one of them.  Remember though, the more
you send out the more potential customers you will reach.
 
So my friend, I have given you the ideas, information,
materials and opportunity to become financially independent.
IT IS UP TO YOU NOW!
 
  ************** MORE TESTIMONIALS ****************
 
"My name is Mitchell. My wife Jody and I live in Chicago.
I am an accountant with a major U.S. Corporation and I make
pretty good money.  When I received this program I grumbled
to Jody about receiving ''junk mail''.  I made fun of the
whole thing, spouting my knowledge of the population and
percentages involved.  I ''knew'' it wouldn't work.  Jody
totally ignored my supposed intelligence and few days later
she jumped in with both feet.  I made merciless fun of her,
and was ready to lay the old ''I told you so'' on her when
the thing didn't work.  Well, the laugh was on me! Within
3 weeks she had received 50 responses.  Within the next 45
days she had received a total of $ 147,200.00 all cash!
I was shocked.  I have joined Jody in her ''hobby''."
 
  Mitchell Wolf, Chicago, Illinois
--------------------------------------------------------
 
"Not being the gambling type, it took me several weeks to
make up my mind to participate it this plan.  But conservative
that I am, I decided that the initial investment was so little
that there was just no way that I wouldn't get enough orders
to at least get my money back. I was surprised when I found
my medium size post office box crammed with orders. I made
$319,210.00 in the first 12 weeks.  The nice thing about this
deal is that it does not matter where people live.  There
simply isn't a better investment with a faster return and
so big."
 
  Dan Sondstrom, Alberta, Canada
--------------------------------------------------------
"I had received this program before.  I deleted it, but later
I wondered if I should have given it a try.  Of course, I
had no idea who to contact to get another copy, so I had to
wait until I was e-mailed again by someone else .........
11 months passed then it luckily came again.  I did not
delete this one!  I made more than $490,000 on my first try
and all the money came within 22 weeks".
 
Susan De Suza, New York, N.Y.
  ----------------------------------------------------
"It really is a great opportunity to make relatively easy
money with little cost to you.  I followed the simple
instructions carefully and within 10 days the money started
to come in. My first month I made $ 20,560.00 and by the
end of third month my total cash count was $362,840.00.
Life is beautiful, thanks to the Internet".
 
Fred Dellaca, Westport, New Zealand
-------------------------------------------------------
ORDER YOUR REPORTS TODAY AND GET STARTED ON
YOUR ROAD TO FINANCIAL FREEDOM!
 
=======================================================
 
If you have any questions of the legality of this program,
contact the Office of Associate Director for Marketing
Practices, Federal Trade Commission, Bureau of Consumer
Protection, Washington, D.C.
 
---------------------------------------------------------

Click on the link below to remove yourself

Other notes:

The company in charge of the removals terminated the account of the sender quite soon after the incident.

I don't doubt the legality of the scheme. and I don't doubt that the sender actually DID make a fortune and go to the Marquesas on the money made by the scheme. However, a lot of people will have paid the money and not got anything to show for it. Therefore, on average, not good value for money!

In answer to points raised about this kind of scheme, I don't think pyramid schemes should be illegal, and I am of the opinion that people should be at liberty to throw away money if they want to. But I think it's important for people to be educated about such things and to be wise enough to avoid being fooled by schemes whose promises are largely unfounded!

Also see Chain Letters , Bank Hoaxes and messages pretending to be from Microsoft and other Scams