Regarding MLM

[icey]

Hi
Is there anyone who can tell me what MLM is about and how does it works. A few days back my aunt joined a company for distributor right by paying over 5digit amount of money. As far as what i know fr her is she'll earn commission if she can find people who want to sign up for a distributor, not selling their products. and the company tell them that MLM is her own business.
how can it be called as a business. to me the company just hire a saleman to promote for their product. somemore the saleman needs to invest its own money to buy a certain amount of product(it's not worth what it is paid) to be a so call disbibutor.
If the company askin resonalble amount is ok. but 5digit plus is not small amount i guess.
Hope anyone can tell me is it legal or illegal and what kind of action can we take against this company. I wanna know how the company paratice MLM. what are the frame for them.
the company is quite well known in singapore. that why i'm worndering how this stupid system work.

thanks
icey

[Strong Eagle]

Icey, your aunt has been screwed. MLM's are a ripoff for all but those who get in very early.

MLM's "feature" a deal where you sign up new suckers (and get a commission for doing so), then you also get a percentage of any money they make. For MLM's the focus is always on getting new people, and the products are usually far more expensive than comparable products in a store (how else to pay all those high commissions?

Here's the problem. The fundamental flaw of all MLM's is that they are a pyramid scheme. Every 'distributor' must bring in new distributors. So, let's say that I start my own MLM... I am the top tier guy for a new product called, "Tiny Titty Treatment". I bring in 10 people to sell the product with the promise that they will get commissions from the next level of people they bring in.

There are 10 level 1 people. Each brings in 10 people. So now, there are 10 people in level 1 and 100 people in level 2, for a total of 110 people.

The 100 level 2 people each bring in 10 people for a total of 1000 people in level 3. Now there are 1,110 people total.

The 1000 level 3 people each bring in 10 people. Now there are 10,000 level 4 people.

The 10,000 level 4 people each bring in 10 people. Now there are 100,000 level 5 people.

The 100,000 level 5 people each bring in 10 people so now there are ONE MILLION level 6 people.

And of course, at level 7 you have ten million people, level 8 you have one hundred million people.

If these things actually worked, the level 8 people would need to scare up ONE BILLION people to keep the chain going. Hello: Time to go market to all of India.

So unless you got in early, the people who join later always get screwed because there simply are not enough people to go around. 90 to 95 percent of people who join MLM's lose money. This why virtually all MLM's are illegal in Singapore unless they follow stringent guidelines.

Those guidelines make it illegal to have to pay money up front to join an MLM so you may have legal recourse. Check out these government links then call them to see what you can do about filing a complaint.

Good luck.

Multi-Level Marketing and Pyramid Selling (Prohibition) Act (Chapter 190) (legal text)
http://www.mti.gov.sg/public/PDF/CMT/fr ... er_Act.pdf

MTI Enhances Safeguards on MLM Schemes Operating in Singapore (human-readable version)
http://www.mti.gov.sg/public/NWS/frm_NW ... 38&cid=950

[Guest]

Hi Icey

For an legal MLM company, they must be member of Direct Sales Association of SIngapore.. If u wanna know how does MLM practices and what kind of legal action u can take is to check out this website to find out more, visit http://www.dsas.org.sg/dsas/Html/afterlogin.htm.

Please tell ur aunt to check it out for DSAS code of ethics n conduct to prove that this company is legalized...

So be careful in choosing company to be partner with...MLM is workable but it just that be careful in choosing the right firm.

[Guest]

Hi StrongEagle

Your information in MLM under Singapore Law is out dated...pls check it out..

http://www.dsas.org.sg/dsas/Html/afterlogin.htm

Please be more sensitive to things that are happen out there...

See n look carefully..dun live in the past always..

[Guest]

Hi
Is there anyone who can tell me what MLM is about and how does it works. A few days back my aunt joined a company for distributor right by paying over 5digit amount of money. As far as what i know fr her is she'll earn commission if she can find people who want to sign up for a distributor, not selling their products. and the company tell them that MLM is her own business.
how can it be called as a business. to me the company just hire a saleman to promote for their product. somemore the saleman needs to invest its own money to buy a certain amount of product(it's not worth what it is paid) to be a so call disbibutor.
If the company askin resonalble amount is ok. but 5digit plus is not small amount i guess.
Hope anyone can tell me is it legal or illegal and what kind of action can we take against this company. I want to know how the company paratice MLM. what are the frame for them.
the company is quite well known in singapore. that why i'm worndering how this stupid system work.

thanks
icey

Hi ICey,

I believe the company you mention will be either bellair or lamb berger. Am I correct?

There are times that people are too greedy and being blinded.

You don't earn money UNTIL you SELL!!

When you buy something either as an investment, you are already at a loss even you are given 99% of the discount!!

[Strong Eagle]

Hi StrongEagle

Your information in MLM under Singapore Law is out dated...pls check it out..

http://www.dsas.org.sg/dsas/Html/afterlogin.htm

Please be more sensitive to things that are happen out there...

See n look carefully..dun live in the past always..

Hey... it's not MY information... those are Singapore government websites. Maybe you should tell them?

Near as I can tell, the URL you posted is the front for MLM and other direct sales organizations. They don't contradict anything I said, and as a matter of fact, point to the same laws.

[Guest]

If you can answer to these questions, then probably MLM is for you:

http://www.mlmwatch.org/01General/10lies.html

Cheers

Faustus Lee

[Strong Eagle]

If you can answer to these questions, then probably MLM is for you:

http://www.mlmwatch.org/01General/10lies.html

Cheers

Faustus Lee

An excellent link! Thanks for posting it.