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.

The Worst Kind of Scammer: False Claim of Government License by Options Rider

Ever heard of "Options Rider"? No? Me Neither, that is, until they started announcing absolutely bull****. But let's start from the beginning.

Back on April 16th, a review of Options Rider appeared on BehindMLM. The company purports to be offering option trading out of New Zealand, but the address is that of a Regus virtual office. And no owners were identified on their website. Shady enough? Searching the interwebs revealed two names: Bob Roberts and Thomas Carter.

Bob Roberts appears to be associated with another virtual entity called BancdeOptions, supposedly HQ'ed in Hong Kong, but it's another virtual office.

Here's the really hilarious part though... At the time of BehindMLM's review (early April 2015) Options Rider showed a license number:  FSP license number 207/13

Sometime after that review, they changed it to FSP license number FSP109805.

But I was able to locate a version of the Options Rider contract, on "WV Trading" that PREDATES the both of them that says: "CIF License number 207/13"

The Company is authorized and regulated by the New Zealand Securities and Exchange Commission to offer certain Investment and Ancillary Services and Activities under the Provision of Investment Services, the Exercise of Investment Activities, the Operation of Regulated Markets and Other Related Matters Law of 2007, Law 144(I)/2007, as subsequently amended or replaced from time to time (“the Law”), with CIF license number 207/13.
The problem is New Zealand does NOT have a Securities and Exchange Commission. New Zealand investments is regulated by Financial Markets Authority. And the cited laws do NOT exist in New Zealand. And obviously, "CIF" number is meaningless in New Zealand. In NZ financial entities are licensed as FSP (Financial Service Providers), but its relevance will become clearer. There is no "Options - anything" licensed as FSP in New Zealand. Search the database yourself.

In fact, you should notice that by typing in a few test cases that NONE of the FSP number goes above 5 digits. Thus, the 6-digit number given by Options Rider is BOGUS.

By now it should be clear that this company is a scam, citing license by a nonexistent government agency for legitimacy. But wait, there's even more hilarity in the lies of Options Rider!