Saturday, April 27, 2013

NEWS: Ponzi Promoter Shot Dead In Kiev, Ukraine

Russian and Ukrainian news reported that Anatoly Parfenyuk was shot dead in Kiev, Ukraine. Anatoly is one of the top promoters of "PFNS Revolution", a Ponzi scheme that claimed to be "crowdfunding" enterprises that generates impossible profits. It is suspected that his death is related to his Ponzi scheme.

For more details, see


Zeek Rewards Update: Some Lawyers are trying to DELAY the claims process

According to Jordan "Ponzitracker" Maglich, who has been keeping track of court documents involving the Zeek case, the receiver Ken Bell filed a document with the court explaining that some lawyers are holding up the claims process with minutiae procedural objections

According to the document, a certain lawyer representing "Belsome" has filed 3 objections to the proposed claims process filed by Ken Bell, who hoped to get the whole thing started by end of April. The objections are summarized as follows:

1) Receiver said he will mail all the claimants a letter via USPS, as it is the most efficient way to reach them. The lawyer objected that he already represents some of the claimants and having Bell contact them "directly" through mail is a violation of lawyer ethics code. Bell said that's ridiculous, as this lawyer ethics rule is to prevent direct contact from ADVERSE (i.e. hostile) lawyers whereas he's the receiver and he's contacting people he's trying to PAY (i.e. friendly lawyer).

Friday, April 26, 2013

Waiting for a company to turn legit? The initial "recruiting reps" rush

A hen chicken (Gallus gallus)
A hen chicken (Gallus gallus) (Photo credit: Wikipedia)
This is sort of a follow-up to the previous day's topic... The "chicken and the egg", or "afffiliates and customers" which come first?

In the MLM case, you need affiliates to sell to customers, but you recruit affiliates FROM customers. You can't have one without the other, it seems.

So what a lot of MLM companies do, in their "launch phase", is to come up with some sort of a plan where the affiliates pay to join up and buy a starter kit of some sort, and have the affiliates go out and recruit more affiliates, who also buy starter kit.

The problem is... that's illegal. There are no real customers. It's just affiliates recruiting affiliates, and that's a pyramid scheme.

The "apologists" complained that MLM have to start by acquiring a lot of affiliates, i.e. "building a sales team" in order to reach the customers. Once a certain threshold had been reached, then the affiliates will go recruit customers, instead of reps.

The problem is the MLM system DISCOURAGES doing that. It makes NO SENSE.

Thursday, April 25, 2013

Chicken And The Egg: a MLM Startup Problem

English: A chicken egg (Gallus gallus domesticus)
English: A chicken egg
(Gallus gallus domesticus)
(Photo credit: Wikipedia)
Recently, on the subject of a "launching" MLM, an interesting question was brought up... How does a MLM company sustain interest in itself when it is mainly in an affiliate acquisition mode instead of customer acquisition mode? At first this question seem to be a "chicken or the egg, which comes first" question, but in the end it turns out this just means the company has a serious identity crisis.

For discussion's sake (as it's company neutral), I'll only mention the name at the end. Let's just say their business model is to launch a way to let people try products, and if they like them, buy them, then they'll get revenue that way (or get some affiliate fees / commission), then share with the affiliates (using whatever formula / rule that was defined).  The affiliate's job is to show people that specific way.

So now you have a problem... The chicken and the egg, or in this case, customers and affiliates.

MLM relies on affiliates to advertise to customers, and turn some of those customers into downline affiliates (who then goes out and advertise to more customers).  You can't have one without the other.

So in case of this business, people who buy the products are the customers, and people who share the "way" would be the affiliates.

Except this business can't keep them apart. In the way business was described, any one can "share" the way (it's an app that shows off other apps, and if you like it, you share it). Any one can share anything.

So what is the difference between an affiliate and a customer?

Nothing... except one had paid into the system (and can earn via the system), and one had not.

Burnlounge, a pyramid scheme shut down by the FTC, had the same problem: no distinction between affiliates and users/customers. The end result is affiliates are getting paid to recruit affiliates. You'd be stupid NOT to upgrade yourself to affiliate (mogul) "just in case".

Wednesday, April 24, 2013

More Indian Ponzi (and Pyramid) Schemes Profiled

A friend tipped me to this article:

Where Mail online basically had the same idea of the blog post I wrote only a few days ago... About the sheep and emu Ponzi, as well as other Ponzis.

In the past decade, India had been through so many Ponzi and pyramid schemes it's amazing how much money had been siphoned off by the crooks, and due to the slow pace of Indian justice system many of the crooks had not been arrested, and some had not even been charged with any crimes.

Tuesday, April 23, 2013

Bad Argument: claiming the 3 stages of truth is on your side

Arthur Schopenhauer
Arthur Schopenhauer (Photo credit: Christiaan Tonnis)
When supporters of suspect scheme want to sound grandiose but without much evidence (a lot like conspiracy theorists), they will often cite this quote:
"All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident."
-- usually attributed Arthur Schopenhauer, German Philosopher (b. 1788)
The intention of the citer is to IMPLY that whatever they want to believe (be it UFO, time travel, or scam, or whatever), but cannot defend, will "eventually" be accepted as "the truth". 

The problem is Schopenhauer never said it. What he said was:
Der Wahrheit ist allerzeit nur ein kurzes Siegesfest beschieden, zwischen den beiden langen ZeitrÄaumen, wo sie als Paradox verdammt und als Trivial gering geschÄatzt wird.
Which in English, says:
To truth only a brief celebration of victory is allowed between the two long periods during which it is condemned as paradoxical, or disparaged as trivial.
(See citation)

Nothing about ridiculed or violent opposed. Further research of all Schopenhauer works failed to produce a quote even SIMILAR to it. Clearly, this quote ain't right. Yet it was attributed to Schopenhauer by Harper's Book of Quotations (1981 et al).

Monday, April 22, 2013

HILARIOUS: Company not only not terminate affiliate who joined with false info, it paraded him as example to follow

Previously I've highlighted a particular company that basically was daring you to commit (i.e. give it money) in order for you to make money. Its owners claim to be badasses, and wants to turn you into badasses.

What do these badasses know about rules? They sure have some. I'll point you at a particular one:

Or in text form:
Okay, that's pretty clear that in order to join, you agree you must be at least 18, right?

Guess what... they just celebrated someone who's only 12. Not only did he join, he's being celebrated as a "badass" who made $12K in four months with this place. The kid's Jesse Marsma, 12-year old from Holland.

Sunday, April 21, 2013

How NOT to Defend Your Scheme, with an Example

This entire blog can be considered a "what NOT to do" by MLMers, which of course, is infuriating to some amateur MLMer who learned to do things the wrong way.

Recently, there was this poster by the handle of "worldventurehappy" who repeatedly posted unsupported opinions both on this blog and on BehindMLM on the topic of World Ventures. Whether World Ventures is a scam or not is not the question here (but you can read Oz's review at your leisure). The problem is what a lousy job "WorldVentureHappy" did to defend his favorite scheme.

Let's start from the beginning... several comments here on my blog. Here's the first:

Well, that's definitely hostile intent, right? That's hardly pleading for "fairness". It's basically "F*** U!"

My conclusion was that MLM and Travel doesn't go together. If you don't agree, give me some evidence on why you think I'm wrong. Telling me to "get a life" only proves that your feelings are hurt, nothing else. And if your feelings are hurt so easily, you should not be in sales.

But what prompted it? It seems to be some "cheerleading" remarks he posted over at BehindMLM (linked above) regarding World Ventures. However, Oz had apparently nuked the comments as spam. (which only upsets him as he considers that "censorship")

Nine days later I get this comment from the same guy:

Note the URL where this comment was posted: "Why is MLM not a pyramid scheme"

It wasn't even the same topic he posted prior, and then he accused me of saying "Every MLM is a pyramid scheme", when the topic of the post is the DIFFERENCES between MLM and pyramid scheme.

Is this guy f***ing BLIND?!?!?!  It's certainly not looking good for his intelligence.

EDIT: The It appears WorldVentureHappy deleted the comment, and continue to insist I'm equating MLM to pyramid scheme. Clearly, some people have problem dealing with reality... and prefer their fantasy where they insist on believing they read something that doesn't exist.

But wait, there's more!