Scam Analysis: The Fake Rental Scam

Fake Rental Scam happens frequently. With free listing service like Craigslist, but also other rental sites, it's proliferating like mad, as it costs virtually nothing to perpetrate, and yields quite a bit of money at a time. It was estimated that 12% of all rental listings on Craigslist are probably fake. And with COVID-19 running around, it's getting WORSE!  

What's even stranger, you can be victimized even if you're not renting!

I will detail three variations of rental scams, how they work, and how you can spot and avoid them. 

First variation of the Scam:

A1) A is looking for a place to rent, found a listing by B (on Craigslist or similar place). Prices are below market, and it seems to be a VERY nice place.

A2) A contacts B, who claims to be out of town. B will probably cite a sob story about how previous tenant broke the place and it was a hassle to fix, and he is trusting A to be a good tenant. Now, if A will send the deposit via (untraceable) means like Western Union, Paypal, Venmo, Cash App, and so on, B will send the keys via courier, or even "left with a neighbor". There is a discount if A chooses to prepay the rent in advance instead of month to month. A sent the money.

Generally, B was never heard from again. Though sometimes, for lulz, they will claim the "the old tenant needs a few extra days". 

Turns out, the photos are real, but the place is not for rent. It was cloned from a real estate 'for sale' listing.

Some really blatant scammers will tell A to "go peek through the window", leading to police calls about a prowler or worse. 

This variation is often perpetrated by foreign scammers who know just enough English to clone listings and conduct rudimentary email and maybe text convos, but will probably not talk to you live (but some may). Mistakes can be blamed on autocorrect. Their reply often contains a sob story (previous tenant trashed their place), a lot of virtue signaling (they're doing missionary work in X, they are traveling salesperson, they are in the military, etc.) about why they can't meet you, but you should trust them and send them money anyway. They may even fake a "credit check" (to steal your identity).  But there is no house to rent. They take your money and disappear.

RECOMMENDATION: NEVER rent from someone out of town, EVEN IF they are using a "local" area code phone number (those are easy to get with VOIP). 

WARNING: Do NOT accept even if they claim to have a "relative" or "friend" in town to meet with you. It could be just another scammer. Also see second variation below. 

But wait, there's more!

Scam Psychology: Bogus Science and Alternative Facts Redux

One of the ways scams and woo spread is by linking a famous person to it, never mind that famous person actually said the EXACT OPPOSITE.

Recently, there was a Twitter debate when someone rehashed the myth that "cancer cannot survive in an alkaline environment", and cited Dr. Otto Warburg, 1931 Nobel Laureate, and even claimed that's what he got the Nobel prize for.  But it wasn't.

This alkaline nonsense was thoroughly busted by Snopes back in 2016, as well as by practically every major medical news website and several hospitals and medical schools. To make a long story short, it's circular reasoning. Dr. Warburg actually discovered that cancer cells produce MORE lactic acid by using a different metabolism method than healthy cells. While a cancerous body is slightly acidic than normal, this is the effect of cancer, NOT THE CAUSE. And you can't force a body or blood to be acidic through diet (that means your kidneys have FAILED!). It's clear that whoever listened to this nonsense doesn't understand cause and effect. They think cancer -> acid, then anti-acid = anti-cancer. It doesn't work like that.  A caused B. B does not cause A.

But the way they try to validate their nonsense by citing Dr. Warburg via the false citing was the reason for this post. Falsely citing a celebrity is a common scam tactic, usually ignored by the company as that would imply they willingly violated state or Federal laws on False Endorsement and Right of Publicity Claims. In fact, some companies are known to have set up fake news pages claiming links between their products and actors and celebrities such as actor Will Farrell and celebrity chef Paula Dean.

Back in 2004 Actor Ray Liotta sued Nerium after some Nerium reps falsely claimed via Facebook posts that Mr. Liotta's facial complexion improved due to the use of their products. The case was later settled out of court. But this hardly stopped other overeager reps from claiming things that have no basis in science or fact.

One of the more recent victims of false endorsement was Malaysia sprinter Watson Myambek. In November 2018, someone was spreading claims on Facebook that Nyambek is a Bitcoin millionaire to promote some sort of crypto-scam. He categorically denied such allegations and said he will file a report with police and want the lying culprit found.

The point is unless you can trust the source, like a reputable newspaper article, you should NOT believe anything you read on Facebook and similar social media platforms.

Anatomy of a Scam: How "Verification Code" Scam Works

You should NEVER send ANY verification code you received to ANYONE ELSE. Verification codes are for you the recipient, and you ONLY. It verifies to the system that it is YOU who send the request. By giving the code to someone else, you just gave AWAY a part of your online identity... and worse.

With that said, here's how one way a verification code scam can work:

If you post anything for sale on Craigslist, you can be unwittingly enlisted by a scammer to be an accomplice, even if you don't accept the offer.

The scam usually goes like this.

A) You list something for sale on Craigslist. It doesn't matter what.

B) You get a text reply that goes roughly like this:

Scammer: I want to buy (insert product name). Is it still available?

YOU: Yes it is.

Scammer: I sent you a verification code from (X). Prove to me you are real by sending me the code.

(X) can be Google, Yahoo, Craigslist, Microsoft, etc.

C) A few moments later, you get a text message from a "short code" (4-6 digits only, not a phone number) or a phone number. It may or may not be in English.  It does contain a verification code.

At this point, you should cut contact with the scammer. 

The scammer is registering a new account on (X). However, instead of entering their own phone number for verification, they entered YOUR phone number instead. Thus, (X) is verifying that the request came from you. (Not the scammer)

If you give scammer the code, you have linked YOUR phone number to scammer's account. You also enabled them to get an account they shouldn't be able to otherwise.

This has various consequences when the scammer's account is eventually banned for scamming. You will be unable to register for any new accounts on (X) using that phone number. In the worst case, police may track you down instead. And you will have a hard time explaining why is your phone number used to register a scam account.

The effect of this differs by service.

On Craigslist, the scammer can now post ads for 90 days without further verification. And in the future, should you want to register on Criagslist, you may be blocked from doing so.

On Google, this can enable them to obtain a Google Voice number (for phone calls and text) and Gmail address.

For Yahoo and other email services, this allows their registration to go through.

So don't fall for this scam within a scam. 

ref: https://www.techwalla.com/articles/what-is-a-craigslist-secret-code

ref: https://www.kaspersky.com/blog/dont-send-codes/22448/

NOTE: Edited 11-DEC-2018 for wording and link to Kaspersky blog entry

Example of a bogus cryptocurrency opportunity: Ethtrade.club

There are tons of websites purported to make you money based on the latest trends, and the current trend is cryptocurrency, such as Ethereum.

EthTrade claims to generate 20% ROI per month if you invest for 2 months, or 25% ROI per month if you invest for four months.

However, once you look down toward their executive team, their fiction quickly evaporates.

What's interesting is two out of four photos of the executive team are verified to be nothing of the sort.  Let's pay attention to the two in the middle.

As it turns out, the photo of "Michael Jentzsch" is actually a Fiverr member who goes by the name of Andreas_hof. Fiverr is a place for freelancers to advertise their services.

As for "Ichiro Hikita", that's even funnier. It's a stock photo.

I haven't found the real identities of the other two individuals on the "executive team", but I have little doubt they'll also be stolen photos and their bios are utter fabrications.

But then, this is the same way how Ryan Gosling's face ended up on some cryptoscam website.

ALWAYS be wary online.

How to spot a suspicious Real Estate Listing

Someone brought this listing to Reddit /r/scams as it is suspicious as heck.  It's a house listed in New Orleans, and they ONLY take cash.

The listing is full of suspicious details, like

The only agent allowed is ours. Her name is Nicole Miller and can be reached at five six seven two eight four two four nine seven. There are tenants here currently there until March 29th, and need 48 hours notice before sale can commence or before anyone can see the inside. 

The phone number given, 576-284-2497 is a number in Toledo Ohio.

The lister wants 20% down, before you can even look at the house, and the house CANNOT be viewed until March 29th. According to the listing, it was posted on March 15th or so.

The listing was supposedly posted by a "Jeeb Renovations".

Except there is no such company in either Toledo Ohio or New Orleans, Louisiana.

What's even more interesting: Google found a SECOND house, this time in Jacksonville, Florida, for 30000, with the exact same terms: 20% down just to view it, cannot be viewed until March 29th, and the names are completely different, yet the language is IDENTICAL!

The only agent allowed is ours. Her name is Carolyn Dyer and can be reached at five six seven two eight four two four nine seven. There are tenants here currently there until March 29th, and need 48 hours notice before sale can commence or before anyone can see the inside. 

This time, the listing was supposedly provided by a "Larry Hutcherson", but the same 567 area code number was used. So now, we have FOUR different names attached to the SAME phone number, involving three different cities.

It's obvious by now that both house listings are bogus and perpetrated by the same scammer who's out to steal the 20% down "viewing fee". Once the money's deposited, the guy cuts contact, and you'll never see your money again.

Don't fall for the scam.

Herbalife's first post-FTC disclosure still uses funny math to manipulate impressions

Herbalife settled with the FTC in 2016 in exchange for FTC not calling the company a pyramid scheme outright. The settlement included a long series of accommodations and required disclosures, and the first of which was just published, and it included some interesting statistics.  The document is called "Statement of Average Gross Compensation" for 2016, and here's a link to it from myHerbalife.com

It's parsing the numbers that make things interesting and reveals what's between the lines (and behind the numbers).

Note the following tidbits:

"In 2016... 86% of US Distributors (466926) did not receive earnings from Herbalife"

If you do some math, that says 14% of distributors, or about 76000, did receive earnings in 2016.

"In a typical month from June to September 2017, about 45000 US distributors order products for resale from Herbalife and about 40000 of them earned money from their sales and the sales of those they sponsored."

This disclosure statement contrasts HEAVILY with what the president of Herbalife, Des Walsh, said during the November 2 3rd quarter earnings call, where he said

"Today, we've got about 470000 preferred members. We've got about roughly 215000 distributors." (source)

How did Herbalife go from 215000 distributors in June to September 2017 (3rd quarter) to "45000 distributors (who) ordered products" between June and September? If it were only 10-20% variance, we'd say oops, and let them fudge. But we're talking about a 478% variance (45000 vs 215000). 170000 distributors went missing between the President's statement and FTC-required disclosure.

Clearly, the two are using some VERY VERY different definition of "distributor"

Which really makes you wonder... What ELSE is Herbalife not telling us?

Scam Tactics: Why do HYIPs compound DAILY?

Why do HYIPs compound daily?

The answer is "habit loop"... The HYIPs are there to feed you false information to get you to form a habit... "trust us"

Habit loop has three steps

• Cue -- the trigger to start the routine
• Routine -- the behavior
• Reward -- the reward for performing the routine

A cue triggers the habit, much like the bell causes Pavlov's test dogs to start salivating. 

The actual routine is the behavior triggered by the cue. A physical routine is sometimes called "muscle memory", but a routine can also be emotional or just mental, or combinations. 

The reward is the endorphin rush you get when you've completed the routine, can be physical rewards (like chocolate) as well. A reward can be a simple "whew, glad I survived that" to a little smile when you realized you parallel parked perfectly or anywhere in between.  

The way the brain works is as soon as it spots a cue, the brain automatically executes the routine, without further processing. Think of it as "macros" that is run automatically. The brain doesn't need to calculate every move as long as it saw the cue. And the reward for finishing the routine is what cements the routine into place, and turn it into a habit. 

So what does all this have to do with HYIP, i.e. micro-ponzis? 

The HYIP operators are out there to make it your habit. You are prompted and was rewarded for doing so. And to accelerate your habit formation, the ponzis compound daily. Once it became a part of your habit, it makes you resistant to any suggestion that you're involved in a fraud. 

Scam Tactics: How Easy It Is To Fool Experts and Review Sites, or allow them to fool you

Recently, there's an article at Vice.com, where the author decided to play a hoax on TripAdvisor... They created a FAKE restaurant, which is a picnic table in the back of the author's house, created some FAKE entrees (you'll laugh at the ingredients), got some FAKE reviews through burner phones and whatnot, and got it to be the top-rated restaurant in London... a restaurant that does NOT exist.

I won't spoil the method, let's just say, it's easier than you think.

This wasn't the first prank the author, Oobah Butler, had done. Previously he bullsh*tted his way onto Paris Fashion Week and it was absolutely brilliant. But he's hardly the first to prank experts and succeded.

But then, expert reviews are fooled all the time.  In 2008, wine critic and author Robin Goldstein created a fake restaurant, allegedly stocked with the worst wines Wine Spectator magazine had ever rated. The submitted it to the said magazine. After a while, the fake restaurant had won "award of excellence" by the same magazine.

Wine Spectator called it "publicity seeking stunt", but it exposes something deeply troubling... What sort of experts at the magazine review the candidate for "award of excellence"?  And if they let a fake restaurant get on, what can DELIBERATE manipulation do?

But the pattern ran much much deeper than that. Experts are fooled ALL THE TIME.

• TV host displayed a $15 IKEA print in an art museum, and none of the art experts spotted the problem. 
• The Wine Spectator gag had a sequel... a French scientist decided to die a white wine red and gave it to 54 wine science students. NONE could detect they are tasting a white wine.  
• Food experts cannot tell McDonalds chicken McNuggets from "organic" chicken nuggets. In fact, people cannot tell organic fruit from non-organic fruit

And the problem doesn't stop there. There are review and authority websites that secretly signs under-the-table deals with crooks to promote or write nice articles without any disclosure. And this had been a long-standing problem in network marketing.

This Is How Internet Pet Scam Break Your Heart and How You Can Avoid it

Pet scams are all over the place, and pet scammers have moved onto the Internet as well. Current generation of pet scammers create fake "adoption" websites, then hand you off to associates with fake pet shipping services with an excuse for additional fees.

A woman in Milwaukee was duped by a fake kitten adoption website. The man claimed to be in Virginia and will ship her a kitten for $170... Except he demanded payment via a reloadable gift card, not regular methods. Then later, when a separate scammer called her, claimed they need to "recrate" the kitten at the airport for additional $840 that's "refundable" she knew she'd been had. They even used the name of a real pet transport service.

A Delaware woman was duped into sending money via Western Union to a scammer for deposit on a toy poodle, and even told the woman to go to Baltimore, MD to pick it up, except the address was bogus... The man living at that address had no pets, much less a toy poodle.

Delta Airlines discovered that someone had created a fake pet transport service using Delta's name called DeltaPetTransit.com, complete with Delta's logo and pictures of its planes, used by pet scammers to trick people out of even more money.

Scam Tactics: Knowing the Differences among FDA Registered, FDA Certified, and FDA Approved

Recently, someone posted the following comment on BehindMLM

"Davie Watkins" claimed on 6-OCT-2017 that "FDA approved
Vida Divina's Coffee Line in October 2017"

Let's first examine, what did "Vida Divina" reps say about FDA? If you Google, you may find:

The search results says "FDA certified", or "FDA Approved". But what is the truth?

None of the actual results link to FDA, it's just announcements, and they can't even agree on the language. Some say "certified", some say "approved". What is the truth? As it turns out, it was NEITHER.

Scam Tactic: Moving the Goalpost (aka Special Pleading)

Moving the goalpost is very simple to explain with a single image:

Moving the goalpost, courtesy of zapiro @ zapiro.com

If someone moves the goal post, you'll never to be able to score a goal.

So what does that have to do with scams? Two ways:

1) when scammers promised one thing, then moved the goalpost with some excuses, or

2) when scam deniers tried to deny the evidence of the scam by moving the goalpost.

Scammer Moving the Goalpost

Scam companies that promise an IPO (initial public offering) while offering stocks or options to affiliates are known to move the goalpost because the IPO either will never take place, or takes place but were completely useless.  One such example was Wantong Miracle 萬通奇跡 scam in China, where a known scammer who launched multiple scams in China AND in the US seem to have finally been arrested by Chinese authorities.

Some suspect that recent attempts by Visalus to roll back the promised "founders equity incentive plan" may also be "moving the goalpost" after one side had already satisfied the requirements, only to be met with even MORE requirements from the other side or lose the supposed equity incentive they have gained, that a judge had to issue a restraining order.

OneCoin, which has been accused by multiple regulatory bodies on multiple continents of being a scam or a suspect scam, has repeated changed or delayed its IPO or ICO (depending on when you asked).  In January and February 2017, OneCoin announced they will go IPO in "early 2018", then the date was moved to July 2018 according to a Chinese website on OneCoin. However, in September 2017, the news completely changed. Instead of IPO, affiliates of OneCoin claimed that OneCoin will conduct an ICO (initial coin offering) instead, and it will not be until October 2018. That's at least THREE delays in less than a year, and it's ALWAYS a year away.

"Always delay the day of reckoning" is a standard bull****er tactic.

Let's go onto our next topic, scam denier moving the goalpost

What you can learn from the EuroFX scam that targetted Chinese victims

EuroFX is supposedly a forex trading company that started in 2012, has 13 year experience, and promised fat returns. It was shut down as a pyramid scheme in China in 2014, with possibly tens of thousands of victims that spread from the US to Phillippines, with possible amounts exceeding 2 billion USD.

What's interesting is the scope of the fraud: this involved Britons, Aussies, Singaporeans, and possibly more, with possible fake names and dozens of companies registered in UK and New Zealand and Australia.

The alleged head was a Briton by the name of David Byrne, and they promise returns of 6 -16% PER MONTH if you can invest up to 250K.  He presented himself as either CEO or Acting CEO. However, when investors caught up with him later after EuroFX's collapse, he claimed either he was only onboard for less than a year, or he's only "consultant CEO".

Whether David Byrne was guilty of collusion was NOT the issue. It's the matter of perception.


Myth: Companies registered in the UK are required to follow all UK law. 

Reality: Companies registered in the UK, but not sell to UK citizens, are NOT governed by UK law. In other words, a UK registered company can cheat and scam non-UK people, and UK law enforcement can do NOTHING about it.

That's what happened in EuroFX, were ActionFraud, the UK fraud hotline, received multiple tips about EuroFX, and even investigated, but ultimately determined that it is NOT within UK jurisdiction as it sold nothing to UK residents and citizens.

Basically, UK biz registration is worthless.

Not that you can rely on just a biz registration to determine if a business is legit any way.

But the point that companies can hire temporary CEOs is the other thing to take away... the alleged CEO is just a part of marketing.


Also see following links:

http://fortune.com/2016/08/13/eurofx-pyramid-scheme-china/

https://atozforex.com/news/why-the-west-ignores-british-ponzi-schemes/

http://eurofxvictim.weebly.com/ (Chinese/English site set up by victims to preserve evidence)

Scam Tactics: Whip Up Fear, Provide "Solution", Take Your Money under false pretense

A lot of so-called "entrepreneurs" (read: MLM noobs) are so fond of repeating marketing speech they don't ever stop and wonder WHY are they doing what they're doing, and whether it makes any sense. One of which is the "mystery tease", where there's practically NO public info about the company, or the promoter is trying to keep things VERY VERY vague. You pretty much have to join, get the info, then consider canceling in order to get ANY information on the company.

When questioned why does the company operate this way, the rep, either stammer "so don't join" or retorts with insults such as "you're obviously not an entrepreneur".  The implication for both is "if you want to know about the company before you join, you're obviously NOT ready to join."

Isn't that just faith, i.e. "I am willing to join without knowing what I am joining"?  Does that even make sense? 

But this just reminded me of the infamous diamond scams during the late 1970's in the US. 

The scam is simple... The sellers claim to be sourcing diamonds and are offering them as investment instruments to folks who are afraid of the stock market fluctuations. The concept is simple: "everybody loves diamonds", "it only appreciates because supply is strictly controlled by a monopoly", "all diamonds are sealed with certificate guaranteeing their quality", and so on. And all of these statements are even... true. 

Sufficiently convinced, the buyer sent off a check for thousands, and in a week or so, he gets diamonds... sealed in plastic with the certificate guaranteeing their quality... Except for the caveat: the quality is only guaranteed if the plastic is NOT broken. I.e. any attempt to have it appraised means it's no longer guaranteed. And many customers did break the seal only to find the diamonds are inferior or even worthless quality. It was bad enough that New York's Attorney General has to establish a "Diamond Task Force" just to process the hundreds of complaints of fraud.

This is related to the modern "shrink-wrap contract", i.e. "if you break the seal, you accept the licensing terms", usually for software. And it's in a legal gray area. 

But these diamond hawksters also book hotel or resort ballrooms and hold "diamond investment seminars" where they prey upon fear of the audience ("at this inflation, your stocks and bonds are not keeping up"), and esp. seniors ("if you don't have some easily liquidated assets like diamonds, your kids can seize your cash assets and ship you off to a nursing home")

Doesn't that just reminds you of the modern equivalent? 

Scam Tactic: "Don't knock it until you try it" slogan is very bad advice

One of the most common arguments for income schemes is "don't knock it until you try it", i.e. "it paid me so it works". This is actually a VERY flawed argument. Recently I came across the Skeptoid episode: don't try it until you knock it. While that's about general skepticism, it works very well for financial scam debunking as well, as it destroys all the variations of the bad argument.

Don't Knock It Until You Try It?  Nah. 

Personal experience is "sample size of one". It is noise. It subject to sunk cost fallacy, subjective validation, self-superiority bias, confirmation bias, and all the other cognitive biases. Mankind invented science and scientific process to counteract such biases.  Personal observation is subjective, and therefore biased information. Advocating one to "try it" simply proves nothing.

Yet MLMers love to fly this particular argument. They value personal experience over all others, the exactly opposite of scientific process trying to filter out bad data. It is basically fully faith-based.

I was skeptical until I tried it

A true skeptic would know NOT to try it due to all the reason discussed above. The proper way to evaluate something is through scientific and statistical process from a large sample set, not through a single subjective personal experience.

Falling for a dare / lure to "try it" just makes you gullible, not skeptical. Yet MLMers selling nutritional supplements or unproven "treatments" love to fly this particular argument.  (also see "What's the harm" below)

I know it works, because it worked for me

So somehow, you're God, and what you experienced is the universal truth for everybody, eh? It's just your subjective experience, based on your circumstances at the time, and based on all your PRIOR memory and experiences. If any one else had different life history, experienced the same thing at a different time, under different circumstances, or any combination of such, the experience will be different.

What you experienced is only good for yourself. It is not a data point. It is anecdote.

Where do these MLMers get their "facts"? Certainly not from this reality.

In attempting to engage with some MLMers regarding their unbridled enthusiasm, I've since found out they seem to be armed with a lot of... nonsense from somewhere. They surely don't seem to have just... invented it. But where did they get such nonsense that they perceive as "facts"?

Here are a random sample of  several "not-facts" thrown out for sake of argument by these MLM supporters, all the while chanting "Worre pwn'ed Ramsey!" in the Youtube comments of a Dave Ramsey show where Ramsey provided some realistic outlook on MLM.

It makes one wonder, do they just make up "facts" as they go along?


S1. "MLM works for thousands of people around the world"

S2. "Amway Japan is the biggest company there and has been trading for over 55 years."

A1. I never said anything about "MLM doesn't work", but that's ignore that for the moment, as he did. He put up a strawman, then cited a non-sensical fact in support. "Thousands of people around world" found MLM to be working...

DSA estimates that there are 20.2 million (per 2015 fact sheet, DSA.org) in the US alone, and probably 100 million around the world, in MLM. If only "thousands" found it works, that would suggest TENS OF MILLIONS found it did not work, doesn't it?

Factualness rating: D, true, but not placed in context. A system that works for a tiny minority cannot be considered a working system.

A2. Even a modicum of logic should tell you this is impossible. The biggest corporations in Japan, the haibatsus are hundreds of billions big.  Toyota's revenue from 2013 was 224 BILLION dollars.  This guy seriously thinks Amway in Japan can beat 224 billion? How old did he thinks Amway is any way? Amway Wiki states clearly that Amway Japan opened in 1979. That makes it 37 years old, certainly quite a bit off from 55. And its revenue, as per Amway was 1.1 billion USD (2006) again, AmwayWiki.

Factualness rating: F, completely false in every facet

How to spot shady opportunities V2.0: a 10 item checklist

NOTE: This was a rewritten version of the guide back in 2014.

World is full of Shady Opportunities that want you to put in money with promises of payback. Here are ten signs of shady schemes. Obviously a scheme probably would not have all ten, but the more signs you spot, the more likely it will be a scam.

1. Clickbait-y Slogan
2. Misinterpreted results
3. Conflict of interest(s)
4. Correlation vs. Causation
5. Weasel words
6. Bad Samples
7. (Lack of) Control Group
8. Unverifiable testimonial and Improper disclosure
9. Cherrypicked and unreplicable results
10. Paid or fake media coverage and reviews

Clickbait-y Slogan

EVERYBODY hates clickbaits... They are headlines written with intentional hyperbole and tease to get you to tease. Shady opportunities are the same. Does the scheme make incredulous claims such as "On our team everyone makes money"? Or they somehow "Pay One time $289 and get a minimum of $1040 back Guaranteed!" perhaps?  Before you say "nobody is stupid enough to make this sort of stupid claims"... think again:

Screen cap of Google Search results, yes, someone promised and guaranteed that
$289 will magically grow to $1040 and more. It's obviously clickbait.

As Carl Sagan said before, "extraordinary claim requires extraordinary evidence".  If they made such extraordinary claim, then they should supply the extraordinary evidence to support their claim. And since there are so many ILLEGAL ways of making money... Making money in itself is no proof. 

It doesn't matter if the claims are repeated by the people you trust. They could have been duped and/or brainwashed. If they didn't ask for extraordinary evidence and is convinced of such, then you should not trust their judgement, esp. when they are in no position to evaluate such. 

Misinterpreted Results

We are all affected by confirmation bias to one extent or another. If we hear some evidence, we are going to interpret them based on your experiences, while someone else may see the same data and interpret them very separately. Here's another example:

Monty comic / Is it going to be McCain or Obama?  (old joke on confirmation bias)

The sales pitch is designed to say "just enough" so you think it applies to you, and NOT tell you that parts that "this may not apply to you"... so you can misinterpret the results to be relevant.

Your mindset affects how you interpret the results, and willful blindness, Dunning-Kruger effect, and self-serving bias will lead you down the wrong path. 

Conflict(s) of interest

Most MLM companies in the "lotions and potions business" (nutritional supplements and cosmetics) employ scientists to carry out and publish research... But remember, those scientists may have conflict of interest, and if they did not disclose so, that is a huge ethical violation, as research can be misrepresented for personal or financial gain.

The worst example of which is (former doctor) Darryl M. See, who previously was a researcher at UC Irvine. He wrote a paper touting a Mannatech (MLM) product that he claimed has proven results in his study, and got it published in pretty famous American medical journal on nutrition. However, he never disclosed that 1) he had resigned from UC Irvine months before publication to pursue a career endorsing Mannatech (and was paid thousand per day for speaking gigs), 2) his wife had been a Mannatech rep for years, and 3) he made dozens of audio tapes sold at Mannatech conventions and seminars touting Mannatech products  4) His father was a personal friend of the journal's publisher.

When the news broke, UC Irvine had NO RECORD of any such study had occurred, but Mannatech's president already announced such to its legion of reps. In the end, Mannatech sued See, who jumped to a different company, before eventually forced to give up his medical license due to multiple medical ethics violations.

If someone suggests MLM as a way to solve your financial needs, you need to consider... Are they really doing it because they think it's the right thing for you to make some money... or is it because THEY, by recruiting you, will make some money off of you joining?

Stay skeptical of any and all claims, esp. when it is done with the ultimate aim to recruit you. 

Correlation vs. Causation

When two things happen together, it does NOT mean one caused the other, despite how much you feel one *must* have caused the other.

XKCD... Did cell phone cause cancer... or did cancer cause cell phones? 

Don't get the joke? Following is a 100% true graph...

Is there relation between Autism and Organic Food? They correlate to the third decimal point!?!?!

Yep, that's right, Organic food sales correlate with autism over 10 year period. Real data. But of course there's no causation... Yet that's the point: just because two things happen together doesn't mean one caused the other. It likely to be a mere coincidence.

Yet many MLMers want you to believe that their nutritional supplement made them healthier, their magic rub took away their pain, their magic juice / tea / coffee took away their diabetes, and so on, because those effects "only" appeared when they started using those stuff.

For those of you who watch Stephen Colbert, this is related to the difference between the truth... and truthiness. Or as Colbert himself puts it:

Truthiness is 'What I say is right, and [nothing] anyone else says could possibly be true.' It's not only that I feel it to be true, but that I feel it to be true. There's not only an emotional quality, but there's a selfish quality.

If you BELIEVE it's causation, you'll never accept it's merely correlation. If you believe your nutritional supplements made you feel better, or that special widget increased your car's mileage by 15%, you'll never believe accept that the supplement's merely placebo effect, and the widget is relying on your lighter foot as you FEEL less need to speed and get better mileage. You believe truthiness (There is an effect and I caused it!) instead of the truth (It's just correlation and coincidence).

Correlation is NOT causation (until proven otherwise). 

Scam Spotting: too-good job offer, fake website, and Bitcoins

A redditor recently posted on /r/scams about a too-good-to-be-true job offer:

Hi all, I was hoping you could help me figure if this job offer is a scam. So I received an email saying that I had applied for customer service representative at another company, that was an agency they work with (note I did apply to this), and that they believe me to be better suited for a better job. The HR rep who contacted me said she's confident I stand a chance, and so she wants to forward my application to the hiring manager. The company is currently based on switzerland, and they are opening an office in my area (Toronto Canada) on May 30th. All she requested was that I fill out the employment application. There was nothing weird about the application, it asked for my usual contact info and two work references. No sin number or anything private, or that they couldn't get off my resume. The reason I'm weirded out is because the pay is substantial (for reference it's +20/hr and i'm still in school) and they mentioned the company works with bitcoin. The company name is Trimension Capital Holding. Does anybody have any experience that they'd be willing to share on if this is a scam or not?

This already has a couple red flags

• Based in Switzerland, but opening an office in Toronto
• Over $20 per hour for someone not yet out of school
• Encouraged to apply even if not certain qualified (to do what, exactly?)
• It involves "Bitcoins"

But let's track this down all the way. If you search for "Trimension Capital" on Google, you will get back a Trimension Capital GmbH at Baarerstrasse 135, 6301 Zug, Switzerland. So far, it matches. 

My first link took me to moneyhouse.ch profile fo the company, and we larned that company was founded in 2012 as "Pinewood Capital GmbH", changed name to "Trimension Capital GmbH" in 2013, and changed to "Trimension Capital Holding GmbH" in 2014. It's headed by Thomas Bieri. Under "contact" it shows website as trimension-capital.com

MoneyHouse.ch says the website should be trimension-capital.com

Next couple links goes to trimensioncapital.com   NO DASH!!!!!!!

Something is very fishy here. Let's check DNS at WHO.IS

Scam Tactics: Indignantly imply everybody else is wrong i.e. Nerium Proponent's Comment Dissected

skepticism, skeptical inquiry, critical thinking,
critical inquiry, and truth-seeking. (Photo credit: Wikipedia)

When you see a random claim, do you simply accept it as is, or do you adopt the Reagan doctrine: "Trust, but verify"?  A skeptic uses the latter.

Indeed, scam tactics often simply deny everything, randomly make some claims, and claimed to be outraged at the lack of facts presented.

Recently I came across this comment by a Nerium proponent. I am going to number the claims (i.e. sentences that appear to be factual, not merely an opinion), and let's verify each one.

Get your facts correct please. Nerium sold at Sears was counterfeit. (1) You will no longer find it there. (2)
The extract itself, NAE-8 is patented. (3) Look it up. Do a tiny bit of research on Jeff Olson (4) (you’ll kick yourself for your ignorance).
The before & afters are from its distributors. (5) One bad apple doesn’t spoil the bunch & that apple was taken care of (6) – & others warned.
Most importantly, results from the night treatment are published in the peer-reviewed literature. (7) Try looking up the Journal of Aging, Science, Jr of Clinical & Investigative Dermatology, etc…… (8)
The patented extract is the first superantioxidant on the planet. Look it up. (9)
Please don’t confuse searching with research! Try it, you might just learn something new!

Claim 1: Was Nerium sold at Sears counterfeit?

As we have not seen this listed ANYWHERE (search for Nerium + Sears just brings up similar night creams) we'll have to say "unverifiable", as we have nothing to show either true, or false.

UNSUPPORTED CLAIM, BUSTED

Claim 2: Is Nerium sold at Sears?

Nope, nothing there.

TRUE (but inconsequential, how often have you seen MLM products in retail? Never!)

Claim 3: Is NAE-8 patented?

Nope, NAE-8 is a registered trademark, not a patent. Nerium appears to hold at least two patents on how to extract oleander and aloe, but NAE-8 is not "patented", just trademarked as "non-medicated skin care preparation ingredient" under cosmetics.

BUSTED!

Claim 4: Is there anything surprising on Jeff Olson?

Searching for Jeff Olson shows that he used to ran People's Network, a Self-Improvement TV Channel, that got bought by Prepaid Legal in 1997ish, and he became Prepaid Legal's CEO in 1999. In 2001 PL was hit by Wyoming Attorney General with charges of illegal income claims, then SEC also hit Prepaid Legal for misclaiming expenses as assets (i.e. inflating its financial situation). PL was sued hundreds of times in Missouri, won a few, lost more, decided to settle the remaining 400+ cases. Then things were quite until 2009, when both FTC and SEC subpoenaed some documents for fact-finding missions. In 2011 PL was bought out and reorganized, and Olson left (or was forced out) and started Nerium.

Nothing too surprising, or worthy of emulation, IMHO. Got lucky and got acquired, had to wield whip on sales force to keep them in line, and got forced out during corporate shuffle.

HALF-TRUE

Scam Psychology: Presumption of hate

One of the more... insidious aspects of MLM is how its members will often NOT listen to "reason", even if it's coming from people they used to trust, like family members and best friends. They are often screaming for some understanding, that they really are trying to improve their situation, and why are people around them so... defeatist, and so on. They will appear to be completely brainwashed.

(Sidebar: China claims to have found a new type of paranoid disorder they temporarily named pyramid cult sales disorder. )

But what motivates such... hate? It's a combination of factors, but generally, it has to do with how you perceive people on the other side, and its origin was longstanding.

In a research by Liane Young at Boston College, it was revealed that both Democrats and Republicans (political parties in the US) claim that they were motivated by positive emotions such as love and loyalty to their party members, and their opponents were motivated primarily by hate and animosity.

In other words: "I think you hate me, therefore I hate you."  It's basically preemptive hate.

Scam Tactic: Deny everything, make up some other reasonable sounding reasons

When confronted with truth that contradicts their world view, MLMers often resort to denial, i.e. "that can't possibly be true". It's motivated reasoning, i.e. thinking with your heart, not with your head, and that means impulsive rather than logical decisions.

After the denial, then some alternate explanations was supplied with no proof in order to justify the view.

Recently on BehindMLM I encountered a perfect example of such.

On Feb 6th, 2016, commenter B.F. wrote on BehindMLM that MLM "Kyani" was "kicked out of the Norwegian direct selling organization (Direktesalgsforbundet) for using illegal health claims in the official marketing."

Less than 24 hour later, commenter "MLMexec" replied "Kyäni was not kicked out of the Norwegian DSA because of illegal marketing. They were trial members for a year and weren’t accepted as full members because Eqology and Zinzino joined forces to vote against it."

But is that true?