Saturday, July 19, 2014

Anti-Scam: A Rough Guide to Spotting Shady Opportunities, (part 3 of 3)

This guide is an adaptation of "A Rough Guide to Spotting Bad Science" by "Compound Interest", converted for spotting "shady opportunities". For length reasons, this is presented in 3 parts. This is part 3 of 3.

A Rough Guide To Spotting Shady Opportunities  (part 3 of 3)

Shady Opportunities are out there, waiting to take your money on promises of fabulous income... if you hand over your money first. There are twelve signs. Obviously a shady opportunity may not have all the signs, but the more signs you spot, the more shady the opportunity is.

9) Unverifiable Testimonials / Improper disclosure

Real testimonials were unsolicited from users who have no personal interest in the success of the product.

The problem is "personal interest" spans a huge range, and often in areas that you may not expect.

Dan Ariely speaking at TED
Dan Ariely speaking at TED (Photo credit: Wikipedia)
A person who paid a tidy sum for this 'wonder pill' will have a vested interest to learn that s/he did not spent the $$$ on worthless junk, thus they will be EXPECTING a positive result. Behavioral economist Dan Ariely of Duke University have previously done a study that showed that more expensive placebo works better.  How do you know if the product you paid a like $40 for monthly supply really works better than fancy sugar pills? How do you know if the product really works unless you took it for a whole month, and actually have a proper objective measurement instead of "how do you feel" i.e. subjective mood? How do you know the person making the testimonials (that you are listening, watching, reading) are not affected thus?

Furthermore, the testimonials often came from promoters... who are out to recruit you. They have a FINANCIAL interest in making sure the product works, more than merely effectiveness interest.  And when they don't even identify themselves as promoters, they are running afoul of Federal Trade Commission guidelines on online advertising.

Testimonials in generally CANNOT be relied upon. You need large scale scientific studies to verify efficacy. If they rely on testimonials instead of science, they are shady and should not be trusted.

10) Cherry-picked results
11) Unreplicable results

If they only mention the good studies they probably have something to hide.

Mannatech, in attempt to prove themselves, have indeed sponsored many clinical trials for their "glyconutrients", and many were indeed done by large reputable research labs.

Two of the tests was done by Dr. Best in Australia's Flinders University.

Back in 2005, Dr. Best did a research on Ambrotose. The conclusion was:
There were no statistically significant effects of the treatments on the performance on any of the outcome measures.

Yet in the 2010 study by the same Dr. Best, with slightly different methodology, she claims noticeable performance increase.
Significant beneficial effects of saccharide supplementation were found for memory performance and indicators of well-being

But of course, it was the 2010 study that was heavily highlighted and distributed to all Mannatech members, and was even mentioned by Mannatech’s “forward looking statement” to investors. Not a single WORD about the 2005 study contradicting the 2010 study.  That's cherry-picking, folks.

Extraordinary claims require extraordinary evidence... VERIFIABLE evidence. Unreplicable and contradictory studies are NOT supporting evidence, much less "extraordinary" evidence.

12) Media Coverage and Reviews

Who wrote about this opportunity? If nobody covered it, or only covered as "press releases", then the company is not nearly as big as it claimed to be.
PR Newswire logo
PR Newswire logo (Photo credit: Wikipedia)

Public Relations Firms are known to issue press releases, which are
sometimes posted on major news outlets. Those that appear on major news outlets obviously cost extra, but you can easily BUY such coverage.  Sites like PRNewswire will guarantee posting on WSJ or NYT or similar outlets if you pay them enough.

And sometimes, some website will simply FAKE press releases, by claiming their announcement had been seen on various legitimate outlets but it's hosted on their own website. This happened so often, FTC sued ten of these fraudulent PR companies to stop them from making up fake news.

Remember, scammers are perfectly willing to lie, and you accept the lie.

And you will do so if you are ignorant of the facts, and are just NOT skeptical enough to question "proof" provided, then you should not complain about why could people trick you, when you ALLOW yourself to be defrauded.

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