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Pyramid Schemes and paintball

Ok, maybe this is not 100% paintball related, but take a moment to read it so you know the truth.

Pyramid scheme posts have been popping up all over forum sites today, not entirely sure why today. Maybe someone really wants cash before the holidays. They come in many forms but the idea is the same each time. Send money to someone(s) then add your name to a list and push the list through massive distribution in hopes that somewhere along the lines, you get sent money in return .:rolleyes: .. someone posted it on here today and claimed it was 100% legal according to the post office because it is a lottery... lol .. well you local judge won't see it that way.

Fact is this, simply stated: While they are considered lotterys, they are also considered investment fraud and punishable in most if not all states. Pyramid schemes are a criminal form of investment fraud in which a large return on a small amount of money is promised, if the initial investor convinces new recruits to invest their own money in turn. The "pyramid" is built on the belief that others will continue to add their own money into the scheme. But once additional investors become scarce, the pyramid collapses and large amounts of money can be lost. Increasingly, pyramid schemes are conducted via the Internet and e-mail.

The following is the case for California, a state where I used to practice law. I'm sure you can find your own state's penal code involving pyramid schemes.

CA PENAL CODE SECTION 319-329

Quote:

321. Every person who sells, gives, or in any manner whatever, furnishes or transfers to or for any other person any ticket, chance, share, or interest, or any paper, certificate, or instrument purporting or understood to be or to represent any ticket, chance, share, or interest in, or depending upon the event of any lottery, is guilty of a misdemeanor.

322. Every person who aids or assists, either by printing, writing, advertising, publishing, or otherwise in setting up, managing, or drawing any lottery, or in selling or disposing of any ticket, chance, or share therein, is guilty of a misdemeanor.

Please report all instances of someone posting such schemes and consider any money you spend on them to be lost

Here is your warning!
I find anyone promoting these schemes, they'll be out of more than just their money. They will be banned.

Understood?
Good!

Good post Nasty!

Outstanding post!!! Whole box of cookies for you :slurp:

and stuck! for now anyway... There might be a better place to put this but everyone should read this.

thanks for clearing that up!

not just for me but for everybody

what exactly is a pyramid scheme? can some one please sum that down to stupid-people terms. either im really tired, or i am just plain blind/ stupid.

you pay money to join and get you get more people to join and every month or whatever they raffle off money more they give it in order to the people that were their first down to last , but its like it works at first but then the last people don't get money :mad: and its illgeal

hmmm...... generally anything that promises u money on the computer is some sort of scam.

Quote:

Originally posted by .:{}:.
hmmm...... generally anything that promises u money on the computer is some sort of scam.

Sad, but true

a very common one, is what a lot of them refer to as "matrixes" (not at ALL related to the marker, or the movie) where they say that you can send them for example 200 dollars for an Angel. when you send them the money, they put your name at the bottom of a list, that they call a matrix. each matrix, has a certain number of people that it will contain.
in this example, lets say that the angel matrix has 20 slots in it. when you send them money, your name goes in slot 20. Each time that another person sends them money, your name and everybody above you, goes up one slot, and that person takes up slot # 20.
when you reach slot #1, you wait until one more person sends them money, and when they do, supposedly you get the angel sent out to you. Its a great theory, unfortunately, it can take months and months for your name to move up that list. during which time, most peeps lose interest (and their cash) and the list goes poof.

these matrixes are REAL common, and not just for paintball, I've seen um for TV's, Ps2, Xbox, dvd players...all kinda stuff.
the ads for um proliferate EBAY, usually in the form of a 1-10 dollar auction, where you buy INFORMATION on how to buy such and such for such and such price. usually looks something like "Buy and autococker for 30 dollars" "you are bidding on information on how to buy an autococker for 30" or somthing similar like that. Bad thing is, that most of the time, its not the peeps running the matrixes that are doing this, its the people that are on the lists, wanting to get their names bumped up faster.

so that Matrix Paridise website thing is a pyramid scheme? That's nice to know, I shall alert my friends who know of the website.

By law, no they are not an illegal pyramid scheme. Even tho they function very much like one, and more people lose money off of them than actually get anything. Also most of the matrix sites dont stay up for more than a year cause it costs the person(s) running them more than they make off of it.

Quote:

Originally posted by DarkeWolf
By law, no they are not an illegal pyramid scheme. Even tho they function very much like one...

hehe... silly guy.. read up on your state's penal code :D The FTC would certainly disagree with you.

Quote:

State officials independently file cases in state court, often under specific state laws that prohibit pyramids. California defines pyramids as "endless chains" and prohibits them under its laws against illegal lotteries.(9) In a slightly different vein, Illinois classifies pyramid schemes as criminal acts of deception directed against property.(10) Some states like Georgia prohibit pyramid schemes under a statutory framework that regulates business opportunities and multilevel marketing.(11)

Also, consider the the statement below

Quote:

I use to be a Matrix Owner of 3 sites. And recently I close them due to the fact that there was just to much competion out there for me to stay in business. Yes I realize that competition is part of every business, but usually you do not have to compete against nearly 300 sites out there that are just like yours. So if you are a Matrix Customer thinking of opening your own Matrix site, please do not. You will only cause yourself unneeded problems, and you will soon have to shut down your sites.

Now when I started my sites I thought it was a good way for people to purchase quality ebooks and wallpaper and get rewarded for it. So after doing research and being a Matrix customer myself, I started one site. It was Matrix--One.com, this was my first site and it had a shaky start to say none-the-least. Then after advertising in the forums and on ebay and yahoo and a few other places I started getting more business, but still I had to compete with numerous other Game System oriented Matrix sites. So I decided to open up a strictly cash Matrix site, called Million-Dollar-Matrix.com, and with this site and the low amount of money required to join, I had a site that took it a little bit more money than my Matrix--One site. But still I was not making very much money off of either sites. In fact I was making more money being a Matrix Customer than a Matrix Owner. Now realizing that ebooks were not a great choice to sell on a matrix site, I created another site called Abstract-Wallpaper.com and sold Desktop Wallpaper that I created that was quite unique. But by the time I created that site, it was to late, to many sites were out there and there were more popping up every other week it seemed.

So looking at how I was not making hardly any money, I chose to close down. Now even though I had it in my TOS agreements that my customers agreed to before they purchased that there would not be any refunds, I chose to honor the refunds anyways, but realizing this I would not have enough money to refund everyone. So I waited until I did have the money to refund everyone before I closed up the sites. My projected date for closing was August 31, 2003. Unfortunately before that date at the beginning of August, I was contacted by Consumer Affairs that a complaint had been filed against me not by one of my customers but by a member of this site, who believed he was acting in good faith, and reported my site as a Pyramid Scheme. Now of course in Tennessee it is illegal to operate a Pyramid Scheme business. So after I received that letter I decided to close my sites early and consult a lawyer. I consulted 2 lawyers for which one was not 100% sure my sites were illegal more like 80/20 sure it was, but the other lawyer was 100% sure that they violated Tennessee state law against Pyramid Schemes.

Now I have been a strong supporter of the Matrix system, and I am in no way becoming a hypocrit, but perhaps the Matrix model is not the best business plan, and I have realized it is not, but sometimes you make bad decisions. And so I have done. And as always I take responsibilty for my actions. So in short, do not open up a Matrix site. If you must, do not do so without consulting with more than one lawyer in your area. It will be beneficial for you. Plus keep in mind that no matter how good your plan is, selling tangible products as some think will save the matrix community, the business model is flawed. So you should work on a way of making the business model more legal, by either consulting with your local Consumer Affairs office or an attorney. My attorney told me that Consumer Affairs is usually more than happy to work with a business that is trying to create a system like this to stay within the confines of the law.

Also remember this, there are lawsuits going on now that will help determine if Matrix sites are legal or not. So be mindful of this too. Also if you have any questions for me you may ask me on this forum...I will be around from time to time to answer questions.

And remember this, I have had very little sales, as most matrix owners have, due to advertising strictly in forums (ebay auctions will get cancelled). There really is not very much money to be made in the matrix sites as a owner. So please take my advice, No More Matrix Sites. Also if you think you will be better off as a Matrix Customer, there are still too many matrix sites out there spreading the customers thin. Even now, I won't join a matrix site. The likelihood of cycling is not feesible for me to join. When there are so many sites, and no new customers coming in, it will take a while to cycle....So keep that in mind. In short I wish you all well in your future indeavors, and remember what I have gone thru as a Matrix Owner, it could happen to you. In my area there is a $2500 fine and up to 11 months in jail for operating a site that is a Pyramid Scheme, which according to the lawyers the other day, mine were. So please do not open up any more Matrix sites.....

wow....! great post DagNasty! VERY informative. Ok, matrix sites ARE illegal pyramid schemes, in some states, maybe federally. Thanks much for that update and correction. :)

nice post

i saw a couple of these schemes on Ebay:paranoid:

yeah, thats where I first heard about them too. I paid like, 99 cents for the urls of a couple of them. sent off 25 bucks to get put on the list for a Ps2. The site went under 3 months later and I never saw squat for my 25.

definitely watch out for them

This should be put in every gun forum.

re: new ebay scams.

There have been a rash of new scams on ebay of people selling just there marker box not the marker or the parts just the box.They will word the ebay sale so that it very shaddy.there is a users now on pbn thta lost almost 500 to this type of scame he thought he was getting a bob long marker what he got was a empty box.

Thanks. Now excuse me while I go and get an Angel for $300.