Bad Argument: "It's Free and You Have Nothing to lose"

Free, but you still can be cheated!
By Stuart Miles, Freedigitalphotos.net

In the recent past, there has been several suspect schemes that basically promised that it's free and therefore you have nothing to lose. It's free to join, and it it promises a lot of money if you do what it wants.

While it is true that if a scheme does NOT charge you any money your chances of being cheated is smaller, it is NOT zero. A scam can promise "absolutely free", yet still cheat you, through several ways.

• Bait and switch
• Upgrade
• Partner offers
• Spam Harvest
• Forced Upsell / Slamming
• Identity Theft

Bait and Switch

By promising free benefits, get you to sign up, then changing the terms on you with a good excuse, the schemer can get you to accept the broken promise. This is due to "foot-in-door" technique, where once you agreed to a small change, becomes more amenable to a large change.

If there's a significant effort already invested, such as recruitment, websites created, and such, there's also the "sunk cost fallacy" involved, where you are less reluctant to disengage because you already have so much invested.


Upgrade/Premium Membership

A variation on bait and switch is to offer a "premium" membership which promised more income or more benefits for pay vs. free membership that has very limited earning. Another way is to limit free accounts to credit only (against whatever's being marketed), instead of cash.

Burnlounge did that and was ruled a pyramid scheme.  it offered free membership but free members can only earn credit to music. "Moguls" (those who paid the monthly fee) can earn real cash when they recruited members. Music was rarely sold. Only 2% of revenue came from music.

Ever Wonder About Those Testimonials on YouTube, Amazon, whatever?

Previously I've highlighted the fact that scammers know how to hire freelancers too to create websites and such. Now you can't trust the testimonials either.

People react to testimonials, even though they are just anecdotal evidence and may or may not apply to the people reading the testimonial. This created a cottage industry of people creating fake testimonials. Yes, I do mean fake.

Some of the more hilarious are those appearing on Fiverr, a "micro-job" site where people do very small jobs for $5, and some of the most stupid micro-jobs is video testimonials.

Searching the Fiverr website in May 2013 shows no less than 1500 different offers regarding testimonials. Some just want to tell you about their "special formula" or script for the testimonial (to be read by someone else, probably), but  quite a few of them offers to CREATE testimonials for you, usually shooting a video of themselves, or write testimonials for you (clearly having never used your product or service).

BREAKING NEWS: ZeekRewards Claim will open by/around May 15th, 2013

Breaking (Photo credit: Wikipedia)

According to announcement on ZeekRewardsReceivership.com in a new "letter" receiver Ken Bell stated that the claim portal will open on or before May 15th, 2013.

ALL CLAIMS must be processed through the court-approved claim portal unless you receive special waiver from his office.

DO NOT send them anything BEFORE the claim portal opens. They will NOT be considered valid claims.

ALL CLAIMS must be RECEIVED by them before September 5th, 2013 for it to be processed. Anything received AFTER that date will NOT be considered valid claims.

Only in VERY RARE circumstances will anybody be allowed to send documents directly to the receiver's office INSTEAD of through the claim portal. And you must request special permission.

Read the letter, get your paperwork ready (proof of all the money you put into Zeek) and be ready to submit the claim when the portal opens.

http://zeekrewardsreceivership.com/pdf/ZRWUpdatefromReceiver5.9.13.pdf

How Much Can You REALISTICALLY Expect to Make With MLM?

Money cash (Photo credit: @Doug88888)

One of the more persistent questions in MLM is "Can I really make money in MLM, and how much can I expect to make realistically?"

The answer is surprisingly hard to pin down, as proponents and opponents are both guilty of cherry-picking the data to suit their own side of the story.

Thus, as a skeptic, it is an interesting exercise to get some REAL numbers and give you a realistic number, while showing you all the work so you can tweak the figures if you don't feel it's realistic, and get your own answers.

How much money *can* you expect to make in MLM? The numbers may surprise you, and my numbers are released by the MLM industry themselves. So if there's a bias, it'd be a PRO-MLM bias.

BREAKING NEWS: ZeekRewards Receiver's Claim Process Approved by Federal Judge

People have been keeping track of various motions, including the preliminary claims process submitted by Zeek Rewards receiver Ken Bell, as they go through the legal system so the victims can register to recover their money lost in the widest spread Ponzi scheme in American history. And now we have reached a critical chapter: Federal Judge Mullens have just signed his approval of Ken Bell's claim process. It is now OFFICIAL.

Soon you will see an announcement on the website zeekrewardsreceivership.com that will explain how to file your claim if you indeed lost money. If you GOT money (and I don't mean those fake income proofs or 1099's, but actually took out more money than you put in) then expect a clawback demand, and if you ignore him, actual lawsuit.

So if you have indeed lost money, gather all the proof (money submitted to Zeek, such as check stubs or copies, bank statements, eWallet transaction histories, and so on.) You will need them soon. Maybe in a few weeks, but "soon".

http://www.patrickpretty.com/2013/05/08/urgent-bulletin-moving-zeek-rewards-claims-process-approved-by-federal-judge/

SCAM ALERT: Straw Buyer Scam Targeting Immigrants and Auto Dealers

Deutsch: Audi Autohaus in Dresden (Photo credit: Wikipedia)

A new variation on a straw buyer scam is targeting immigrants and auto dealers in Southern California.
In this version, straw buyers are recruited through friends, churches, schools, Internet forums, and so on.

The general story is friend of a friend (of a friend) was in the US and recently returned to China and got really really rich, and really really wants to buy one of the luxury imports (we're talking 75K or higher cars, like high-end Audi, exotic Lambo and Mercedes AMG, Bently, Jaguar, and so on)  in the US, because the same car in China costs about twice as much due to heavy import tax. However, not being US residents they can't buy a car off local dealership, AND there are export restrictions. If any one wants to... help out this rich guy buy a car the local buyer can pocket $1000 to $2000 dollars as "commission". In one variation, they will even provide a fake license so the paperwork is straight (i.e. buy the car in my name, your name appears nowhere, I'll make the payments).

Sounds easy, right? Turns out it's anything but. Apparently several people in the San Gabriel Valley (near Los Angeles) fell for the scam.

This is how it actually happened. The local guy agreed, and a social security number and a fake driver's license is provided. The local guy walks into dealership, hands over the license and social security number for ID check, signs the paperwork, hands over the check. Credit checks out. Dealership noticed something's not right with the driver's license, blamed some "computer error" and told the local guy to come back tomorrow. Next day, the guy's back, and right behind him was the local police fraud squad. They pulled up the license info... The license is fake, as expected. So the local guy's in jail for identity fraud (fake license) AND attempted grand theft auto (defrauding dealership). That's a couple MONTHS in jail.

Ah, but you say, what if I just use my REAL identity instead of using a fake license?

Not that simple, Sherlock. You see, there's this thing called "1 year export ban" from car maker to dealership.

Scam and Religion: The Great Betrayal

A Church Building
(Photo credit: justshootingmemories)

I'd like to start with a quote.

With or without religion, good people can behave well and bad people can do evil; but for good people to do evil — that takes religion.  Steven Weinburg

People who scam often cloak themselves with religion, and some of the most despicable scammers are pastors thought to be "helping people", but in reality are scamming their parishioners out of money.

Here's one example... June 2012. A San Gabriel Korean pastor scammed what's believed to be well over one million dollars out of at least eight older Chinese-American and Korean-American ladies, through variety of tactics, such as fake business investment, Ponzi scheme, "loan to church", "lack of credit" and get the victim to buy the car (and I'll pay you back), identity theft, and more.

http://www.realscam.com/f14/san-gabriel-korean-pastor-scammed-millions-out-parishioners-escaped-korea-1393/
NOTE: The links are a little flaky, here's the Google Cache of that same page

In a more recent case, WTOL Channel 11 of Toledo Ohio highlighted a local church leader's role in promoting an international pyramid scheme to locals (and benefited in the process).  What's interesting is someone was still posting comments defending her on this blog, STILL claiming she's only "helping people". 

http://www.patrickpretty.com/2013/04/24/wtol-to-air-profitable-sunrise-report-titled-holy-rip-off/

HILARIOUS: When even woo is bad woo

English: Cat litter in box (Photo credit: Wikipedia)

Woo, short for woo-woo, are ideas that are extremely irrational or based on very flimsy evidence, and is also sometimes used to stand for material / products  that has no effect other than placebo. They often claim some revolutionary (allegedly) ingredient that supposedly has such benefits to the body, and is normally a version of "quackery".

Recently, Waiora settled a class action lawsuit when it essentially admitted that they had been watering down their product, something called "Natural Cell Defense", or NCD, which supposedly contains "zeolite", derived from volcanic rock that balances your pH and helps your body purge toxins.

What they don't tell you is zeolites are mined out of earth to the tune of 3 MILLION TONS PER YEAR.

How much does your little bottle of NCD contain? Supposedly 2500 mg (that's milligrams)

Except it doesn't even hold that much in reality, hence the class action lawsuit.