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Old 02-02-2005, 09:03 AM   #21
legion
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These schemes are as old as dirt. They are also called Ponzi schemes. The story goes that some guy name Ponzi in the 1920's came up with the idea. Under his method, it was sold as an investment with guaranteed 400% returns (or some other outrageous number).

The way Ponzi ran it, he recruited an initial group of people. He took $100 from each of them and told them they each had to recruit four people. He took the money from each of the next set of recuits and gave it to the first set. He told this second set to each recruit four people...

So where did the money from the initial group go? He kept it. Eventually the people in the scam ran out of people to recruit...and they were the ones who never got their money back... Someone at the end always ends up losing everything.

Now, a pyramid scheme is legal under certain circumstances. Amway is a pyramid scheme. You have to recruit people into your group to sell Amway products to. The difference between this and what is described above is that with Amway, you are not paying cash directly into the pyramid, you just have to be in the pyramid to buy stuff.
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Old 02-02-2005, 10:05 AM   #22
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I'm unsure how many times I have to state it, but Pyramid schemes are under no circumstances legal in the US. There is only one variation where a business operating in a pyramid model is operating legally. A licensed lottery is the only one. In case it was missed, a licensed lottery is the only one.

By legal and business definition, Amway is not a pyramid model but is an inventory loading model in that their distributors purchase equipment and products (distributors get "loaded" with the equipment) and must resell that equipment to make money because Amway as an entity does not accept the products back. So distributors have to either sell the products/equipment, or lose on their investment. But the money spent by distributors is for a product that is tangible and held by the distributor.

A pyramid scheme promises a return simply for recruiting new members, making an initial investment, or both. There is no tangible product held by the investor (who would be comparable to a distributor in the Amway model) and as such is illegal and different from the Amway model. I'm not endorsing the Amway model, just pointing out how the courts ruled on the many cases involving Amway, or Mary Kay, or dozens of other marketing-centric companies.

I've spend many years working on MLM cases and while they may look the same on the outside, there are many differences. Trust my words when I say that as an investor, or as a creator, of a pyramid scheme, you are breaking the law and risk being punished in both a state and a federal capacity.
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Old 02-03-2005, 09:19 AM   #23
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Thank you for the clarification!

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Old 03-21-2005, 12:15 PM   #24
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Quote:
Originally posted by DarkeWolf
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.
you are wrong. Think about what your saying. IF theres 20 people on the list and every time someone joins the list the person on thetop gets the gun. WRONG!!!!! Thats not how it works. for every person on the list they need 20 more people to sign up to get the first person to get there item if its a 20 person list. See its this common mis understanding that makes people waste there money on these sites. IF theres a site where a get a 1000 angel for 200$ and i only have to wait for 19 people to join i would do it in an instance, but thats ot how it works. It only works like that for the first person who signed up.
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Old 04-07-2005, 09:44 AM   #25
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Would you say this is one ? http://www.**************.com/
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Old 04-07-2005, 09:47 AM   #26
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those right there, are kinda iffy. it depends on if they are asking for money, or asking you to ask other people for money, or if you have to buy something as part of the program. I didnt sign up, so I dunno.
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Old 04-07-2005, 09:52 AM   #27
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WEll basically this site is funded by other companies, like blockbuster and other E-stores, so it has their adds all over it. The more members that you get to sign up for the site and check out the site, the more the sponsers pay These guys, with the money they earn, they get you prizes, the one that i am trying to get is a crossfire nitro tank, but they also have reloader B's, and tippmanns with R/T.
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Old 05-02-2005, 04:27 PM   #28
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is this one here ?
http://www.*******s.com/nurfacepb/index.htm
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Old 05-02-2005, 04:33 PM   #29
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is this one here ?
http://www.*******s.com/nurfacepb/index.htm
yes
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Old 05-29-2005, 09:23 PM   #30
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good post Nasty. thanks for tellin us. i was wonderin how legal that was. now i know to stay the **** away from them
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Old 05-30-2005, 05:22 AM   #31
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anytime!
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Old 08-17-2005, 09:33 AM   #32
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kids get deceived easily. can they go 2 prison 4 promoting it even if they had no idea it was illegal?
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Old 10-26-2005, 06:26 PM   #33
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Originally Posted by stevieray
kids get deceived easily. can they go 2 prison 4 promoting it even if they had no idea it was illegal?
up'ing an old thread, I know.. but since im sitting here couch ridden after surgery here's the scoop..

Legally, depending on the state yes... if it is classified a pyramid sceme. Recruiting people to participate is considered "selling a lottery ticket" for money or goods.

Reality, probably not. The cases going before courts today involve those who setup the "business model" and not so much the participants. What usually happens is people involved get burned and learn their lesson. the top level people (the ones who conceived the plan) are the ones typically targeted by federal or state level prosecutors. This refers to pyramid schemes for the most part.

Matrix cases are still in limbo, not many clear court decisions have been made involving these cases so the area of law surrounding them are still a bit grey.
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Old 11-01-2005, 03:53 PM   #34
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is this sight a scam .i was looking and they do accept paypal but it looks suspicious to me. here's a link http://www.thepaintballhq.com/. thanks for helping me.
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Old 11-01-2005, 05:18 PM   #35
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Quote:
Originally Posted by sdg
is this sight a scam .i was looking and they do accept paypal but it looks suspicious to me. here's a link http://www.thepaintballhq.com/. thanks for helping me.
Yep, it's a scam. It has the "cycling" part at the bottom. It's gonna take a few more people for that Proto, though.
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