I am making this letter my Wednesday spotlight on MLM Women. While this type of deal is absolutely NOT MLM or Network Marketing, these schemes almost always target women.
Luckily we have lots of smart women that read this blog …
From the MLM Business Opportunties Mailbag:
Hi Ty,
A friend of mine is calling her friends and telling them that she is going to give $100 to a person who is promising a certain return on her money. They call and talk to the friend and get information, don’t know what yet. Supposedly there is no risk for the person they are putting the money into the deal for, they just need their acknowledgement. That’s all I know right now. It sounds fishy to me and I don’t want to see my friend hurt or scammed. Do you know of any scam like this right now?
Thanks,
Billie
From the FTC:
When is a gift not a gift? When it’s a “gotcha.”
In a scam spreading throughout the mid-Atlantic states and the Pacific Northwest, people pay to join a “gifting club,” billed in promotional materials as a private club with members eager to help new friends — often from within their own neighborhood or church group.
In reality, the clubs are illegal pyramid schemes. New club members give cash “gifts” to the highest-ranking club members, with titles such as “captains.” And they’re promised that if they get additional members to join the club, they, too, will rise to become captains and receive money – far more than they initially paid to join the club — from newer club “friends.”
The problem is that, like most pyramid schemes, illegal gifting clubs must continually recruit ever-increasing numbers of members to survive. When the clubs don’t attract enough new members, they collapse. Most members who paid to join the clubs never receive the financial “gifts” they expected, and lose everything they paid to join the club.
More from the FTC Alert on Gifting here.
Remember. A real gift has NO STRINGS ATTACHED.
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