Are Gifting Programs MLMs?
March 3, 2007 | By admin | No Comments »
Basically you ask your friends to ‘invest’ in a company by giving away your money as part of a gift. You don’t know where the gifts come from or who they go to (that is what you are taught). Smells like a ponzi scheme to me. I had seen destructive elements occur within network marketing groups that promote these schemes in their downline. They actually feel that they can create more cash flow.
A plan without a product is a ponzi or a pyramid.
If you don’t sell a product or a service, the downlines are paying for the upline’s income. This creates a new problem and doesn’t solve your network’s cashflow problem in the first place.
What about saturation? Most gifting programs utilize some form of Matrix Schemes that require new investors to pay for those at the top and the base of the matrix grows to such gigantic proportions that those at the end are bound to lose money.
Not to mention there are tons of problems with the FTC as well.
Do not touch these with a ten foot pole.
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