Overstated, suspicious and non-sustainable business models characterize pyramid schemes. Such systems are branded in a way to lure victims to confide, using ‘promising rewards’ as the active bait. They tend to succeed because they solely tether their success strategy around people. ‘From on person to another’ is a familiar slogan in every successful pyramid scheme. Based on information already in public domain on former ‘successful’ schemes, any right minded individual would not entertain association with any scam-related schemes. How would one identify a trap leading to pyramid scheme involvement prior to?
In avoiding or escaping participation in any scheme designed to target or self-sort, several guiding questions may assist in uncovering whether or not it’s a trap;
1. Recruitment process
Most schemes pitch structures that deny immediate benefits after recruitment lest one recruit other new members. Such cynicism should serve the role of red light. Legitimate businesses have ways of creating margins and earning consultation fee, not just bonuses from recruitments, as many scammers would promise.
2. The legitimacy of commodities or services claimed to be sold.
Major characteristic identifying a pyramid scheme is its mode of generating income to participants. Normally, recruitment bonuses are all such scammers offer as benefits. Naked schemes, as opposed to product-based schemes have no product for sale. For instance, a one person-recruit-five other in a ‘no fail opportunity’ of investing exemplifies the former.
3. The chances and probability of making more that the recruiting member.
Being cautious of people who pitch success stories of others after their involvement in the package being sold is one way of avoiding participation or involvement in a trap. A tale too good to be genuine and large amounts of money easily and quickly acquired to act as red flags to entrapment. In any situation, persons known to oneself or not, spell out the next big money making ideas that do not accurately define clearly personal role in making money as well as means of increasing proceeds, a recommendation would be focused scrutiny of the whole idea and reach of an informed decision after that.
4. General public information and suspiciously pitched projects.
‘’Recruit your friends and earn $500 a week’ such kind of signs should automatically trigger careful trending in joining and during such membership. Researching on a desired known means to make easy bucks could also help significantly. Information on grands and upcoming schemes is mostly found somewhere, whether on the internet or among the citizenry. In a nutshell, pyramid schemes are as successful simply because their prey is people’s desire for quick money.