DEFINITION OF MLM AND PONZI SCHEMES

Multi-level Marketing (MLM) is a marketing strategy designed to promote their product/services through distributors/members, offering multiple levels of compensation.

Ponzi Schemes are, however, fraudulent schemes, disguising as an MLM strategy. The difference between a ponzi scheme and a lawful MLM program is that there is no real product/services that is sold in a ponzi scheme, and commissions are based only on the number of new individuals one introduces into the scheme.

SETUP
The main idea behind the MLM strategy is to promote maximum number of distributors for the product/services and exponentially increase the sales force. The promoters get commission on the sale of the product/service as well as compensation for sales their recruits make. Thus, the compensation plan in multi-level marketing is structured such that commission is paid to individuals at multiple levels when a single sale is made and commission depends on the total volume of sales generated.

In the case of ponzi schemes , money is charged simply for enrolling other people into the scheme and no real product is actually sold. Only a few people (those who are involved in starting the scheme) make money, and when no new individuals can be recruited, the scheme fails and most of the promoters, except the top ones lose their money, making more people poorer.

LEGITIMACY
The Federal Trade Commission (FTC) has set guidelines that help consumers discern legitimate plans from illegal ones. The difference between MLM and ponzi schemes under these guidelines are as follows:

Sales of actual product or services to consumers, MLM offers products/services whereas ponzi schemes do not.

Commissions are paid on sale of products/services and not on
enrolments.

MLM has a hierarchical commission setup on the sales of products/services, whereas ponzi schemes are based solely on new enrolments which must surely crash because they are not visible, and add no value to the community.

Company buys back inventory from participants at the time of termination, ponzi schemes do not have any inventory.

CONCLUSION:
There is no different between a ponzi participant and those who play football bet.. They are both gamblers, and gambling is a sin... How can you compare a legal business to gambling?

Ponzi scheme is a lazy man's job, and it is illegal.. Be a good citizen, and stop gambling with your future..

That mentality is your number one limitation

Some of these ponzi participate find it hard to let thier money go like that, so they try to deceive others too to know if they can get back their money...

The truth is that those ponzi admins may be your next door neighbors who you know you are far better of in everything..

They will even merge your new invitee to pay them too...

Wake-up friends, MLM aka Network marketing is the best ever and are with Helping Hands International that has reputable sponsors

Remain Committed to your Success
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