Tuesday, May 5, 2015

How Much Is a Scam Like a Cult: 2015 Edition

Previously MLMSkeptic have discussed the similarities between a cult of believers (about a common theme) and a large scale scam such as a pyramid or a Ponzi scheme (and in certain cases, multi-level marketing).

The Outcast (1954 film)
The Outcast (1954 film) (Photo credit: Wikipedia)
A new article on ScienceBasedMedicine.org brought an alternative viewpoint... on how believers of a scam act much like believers of  various alternative medicine modalities. And it is a report on an WIRED article called "An Alternative-medicine Believer's Journey Back to Science", where a doctor (MD and PhD) and wife and two autistic boys fell for the "autism biomed" industry where members tell each other about treatments that nobody had proven to work, but "try it any way", many even promoted by other doctors. After years of such, and a lapse while in Disneyland, they found that none of what they did actually had ANY effect, and the boys actually IMPROVED when they were removed from the supplement regimen, or at least did no worse. After further tests over months and years, he publicly renounced his involvement in the autism biomed movement and denounced unproven treatments and such. As a result, he'd been branded an apostate and had received death threats.

An apostate is someone who had examined the beliefs in detail, even followed those beliefs for a time, then had an epiphany and chose to REJECT the belief instead. As a result, he's now considered an outcast.

There are many apostates among network marketing. Indeed, due to the amount of churn rate, it can be argued that there are many more apostates than believes in Network marketing. According to Robert L. FitzPatrick of PyramidSchemeAlert.org, of the 10 million people that had estimated to have joined Amway since its founding, 9.3 million had been "churned" through and quit. Thus, the alleged apostates should vastly outnumber the believers. (9.3 million vs. 700K)

However, the similarity between network marketing a cult (or religion) is how they treat the apostates: very badly.

Apostates in religion are dealt much more harshly than unbelievers. In Islam, apostates are given a chance to recant, or they will be executed or imprisoned. Christianity is somewhat more lenient on that aspect.

Network marketing's version of apostasy is basically "sour grapes", i.e. they'll accuse you of badly failing at network marketing, i.e. you were bad at NM, therefore you betrayed it, and now you're working for the "other side" as some sort of conspiracy to "bring down a good thing". It doesn't matter if you're not actually an apostate... merely the accusation will make them feel better about themselves.

Same thing as what happened to the doctor couple decided what's best for their two autistic boys... after realizing they had been living a lie for several years.

Yet the sense of "belonging" to a community often kept someone in the company, continue to spend money month after month for products, as well as attending seminars, workshops, conventions, even in other cities and so on hoping to pick up tips and techniques and/or network with others. all in hopes of "making it big", while the pocket empties at an alarming rate.

Same thing with alternative medicine. The couple tried everything, from gluten-free diet to heavy B12 supplements to chelation therapy, and many other experimental treatments with only word-of-mouth recommendations and rumored miracle effects. And these are NOT CHEAP. But they can co-commiserate with other parents who are in a similar situation. This couple is special because he's a doctor and he can offset expenses by making speaking engagements about the therapies he tried on his two sons. But others may not be able to.

And all the meanwhile the victim was told to "have faith", "you will turn the corner", "ignore the negativity", and continue until there is nothing left to put food on the table.

This is not theoretical. This had actually happened to many families. Weaker-willed individuals who are susceptible to this sort of indoctrination, who was more in it to feel like they belong in a group who think alike, doesn't realize the group only wants him or her for purchases every month so they can meet their own quotas for the commissions. When s/he ran out of money, his/her usefulness ends, and it will be his/her fault because the system "obviously" worked for their upline, and s/he is "obviously" bad student and should stay away lest s/he contaminate the rest of the "good" people. 

In the case of the couple, their epiphany came when one of their sons was munching on a waffle in a Disneyland buffet line. He was supposed to be on a gluten free diet and supposedly any gluten will send him crashing to incoherence... but the kid was fine even days later. Clearly, this gluten-free diet is... a joke. And if that is, what else did they believe to be good for their two boys were also complete jokes? After verifying their various "treatments" have had no effect, they announced their apostacy... they no longer believe in the autism biomed cult. And obviously, they are now outcasts.

It is NOT uncommon for such outcasts to turn apostate... or if they can't accept that they've been cast out as they no longer have anything to give, commit suicide. A father of two daughters, trying to juggle real estate, motivational speaker AND up to 3 MLMs, found he couldn't keep up and the family annual income had shrunk to $3000 after taxes... for the YEAR. His wife filed for divorce, and he, one night, stabbed her to death and tried to commit suicide, but didn't succeed, and got life in prison. And he's hardly alone. There are many stories of suicide, financial ruins, and broken families about network marketing / MLM for as long as MLM existed.

The power of "reality denial" for some of these scams also rival religious cults. Zeek Rewards ponzi scheme was infamous for having members starting petitions and such attempting to "clear the name" of the scheme... AFTER it was closed by SEC / USSS / FBI as a ponzi scheme, AND after the owner signed a plea deal with the USSS and SEC. .

screenshot of a lame "Change.org" petition of a few desperate Zeek affiliates, after Zeek was shut
in August 2012, and they are trying to enforce the "positivity only" attitude on each other. 
Sad, isn't it? The largest Ponzi scheme (in number of victims) is viewed by its victims as "nothing wrong with our company" and "this is an ethical company". Cultish denial runs deep in many scams.

Just as many autistic children's parents insisting that THEIR therapy had somehow helped their child.

Beware of the cult.

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