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(The Consumerist)   The FTC is investigating Herbalife over claims that it's a pyramid scheme. I know the wheels of government turn slowly, but damn   (consumerist.com) divider line 100
    More: Obvious, Herbalife, Federal Trade Commission  
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4404 clicks; posted to Main » on 12 Mar 2014 at 6:11 PM (40 weeks ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2014-03-12 05:59:11 PM  
Considering the guy leading the charge against Herbalife has a $1 *billion* short against their stock, and will profit *only* if Herbalife's stock takes a tumble, there's nothing fishy going on at all concerning this investigation. Now, is Herbalife a collection of money-grubbing low-life scumbags running a pyramid scheme? Quite possible. But it sure as shiat would have helped having faith in a fair and honest investigation if this investigation hadn't been pushed so hard by the one guy certain to make a literal fortune if the company goes under.
 
2014-03-12 06:03:03 PM  
Um, I called this pyramid scheme out in the 90s. I figured it would have collapsed/been prosecuted by now. Geesh.
 
2014-03-12 06:13:39 PM  
Herbalife is still around?
 
2014-03-12 06:14:36 PM  
Well, I don't know about pyramid scheme, but it sure as hell is cultlike when the Herbalife folks hang out at the gym...

/creepy people
//really, no, I don't think your sugar, flour, and chemical concoction is healthy in any sense, please stop asking me to buy it
///and why are you having a five-hour talk after 'fit club' to promote it?
 
2014-03-12 06:15:47 PM  
The people at The Forum told me Herbalife would cleanse my liver. They wouldn't lie.
 
2014-03-12 06:16:19 PM  

ClavellBCMI: Considering the guy leading the charge against Herbalife has a $1 *billion* short against their stock, and will profit *only* if Herbalife's stock takes a tumble, there's nothing fishy going on at all concerning this investigation. Now, is Herbalife a collection of money-grubbing low-life scumbags running a pyramid scheme? Quite possible. But it sure as shiat would have helped having faith in a fair and honest investigation if this investigation hadn't been pushed so hard by the one guy certain to make a literal fortune if the company goes under.


This. Isn't this the textbook definition of the pump-and-dump, taking a position and then publicly pushing that position for your own benefit? Weird that the SEC is OK with him doing this.
 
2014-03-12 06:17:31 PM  
The products work. The problem is that you have to play the selling game to get the price to a not-insane level, and by that point the person who signed you up is breathing down your neck to get you signing others up so you and him earn income to further reduce the cost of the products, which actually just recently increased by 3 percent. That's why most people sell, anyway, to reduce their costs for using the stuff. Very few people are doing selling Herbalife for "income."
 
2014-03-12 06:17:32 PM  
The worst date I ever went on started meeting a girl in the toothpaste aisle at the supermarket and ended being pitched a MLM scheme over coffee.

Things got awkward when I questioned how it was not a pyramid scheme, and no, it's not a franchise like McDonalds and Wendys...
 
2014-03-12 06:20:19 PM  
When I think healthy, I think of dying at 44 from a booze and pill overdose.
g
 
2014-03-12 06:20:41 PM  
There was a fugly girl with big fake tits at my gym, she chatted me up and tried to sell me on this shiat. Wore a big button on her boob that said "Want to lose weight? Ask me how!"

She said the power drink mix had "more nutrients than 5 salads" and "makes your hair grow so fast you'll to get it cut once a week." Wtf
 
2014-03-12 06:23:14 PM  

SecretAgentWoman: Um, I called this pyramid scheme out in the 90s. I figured it would have collapsed/been prosecuted by now. Geesh.


Hell, I remember people giving my parents the pitch back in the mid-80s. Even though I was a kid, I knew they were bad news because in the 80s GI Joe comic, Larry Hama explained that COBRA got all of their funding for troops and weapons through Herbalife and Amway style pyramid schemes.

/Larry Hama actually snuck a surprising amount of genuinely useful info into that comic, especially in the early issues before the demands of the toy line pushed things to the outlandish.
 
2014-03-12 06:23:36 PM  

TheDirtyNacho: The worst date I ever went on started meeting a girl in the toothpaste aisle at the supermarket and ended being pitched a MLM scheme over coffee.

Things got awkward when I questioned how it was not a pyramid scheme, and no, it's not a franchise like McDonalds and Wendys...


lol, you got burned.

Thought you were having a good day, cute chick in the toothpaste aisle...You start idle chat and bang, she's going on a date with you.


She had you clocked the minute you passed the crest.


That sucks though.

I thought I was the man when a cute girl approached me at the train station, turned out she was a Mormon on her spiritual quest or whatever.

it happens.
 
2014-03-12 06:24:03 PM  
Pyramid scheme?  Had a couple of distant relatives who were into Amway.  They showed up at a family reunion (this was in the 80s) with a 16mm projector and the reunion turned into an Amway presentation.  I got the feeling that Amway was about 5% selling cleaning products and 95% getting all sorts of promotions like the Super Duper Three Diamond Cluster With Gold Leaf ranking.  Seriously, Mormon Scientologists look normal compared to these guys...
 
2014-03-12 06:24:55 PM  

Adolf Oliver Nipples: Weird that the SEC is OK with him doing this.


Here's a good summary by the Times. I think SEC action is inevitable if the reporting is accurate. Link
 
2014-03-12 06:25:27 PM  
"Girl Scouts sell cookies on a direct-selling method, and nobody attacks them," said CEO Michael O. Johnson in 2013.

The ol' Girl Scout defense - good one.    Hopefully the jury won't notice that GSA doesn't have a pyramid structure that funnels most of the profits to upper management.
 
2014-03-12 06:27:34 PM  

Triumph: The people at The Forum told me Herbalife would cleanse my liver. They wouldn't lie.


It might cleanse you of having a functioning liver.
 
2014-03-12 06:27:52 PM  

tripleseven: TheDirtyNacho: The worst date I ever went on started meeting a girl in the toothpaste aisle at the supermarket and ended being pitched a MLM scheme over coffee.

Things got awkward when I questioned how it was not a pyramid scheme, and no, it's not a franchise like McDonalds and Wendys...

lol, you got burned.

Thought you were having a good day, cute chick in the toothpaste aisle...You start idle chat and bang, she's going on a date with you.


She had you clocked the minute you passed the crest.


That sucks though.

I thought I was the man when a cute girl approached me at the train station, turned out she was a Mormon on her spiritual quest or whatever.

it happens.


I've seen it happen too. Almost happened to me with the gym chick. Seems a bit of a dangerous sales strategy to flirt with and go on pretend-dates with guys to try and sell them on a MLM scam. End up leading on the wrong guy...

Oh well, beats working for a living, I guess.
 
2014-03-12 06:29:28 PM  
So's Avon but they, like others, are too big now to go after.
 
2014-03-12 06:32:50 PM  

trippdogg: "Girl Scouts sell cookies on a direct-selling method, and nobody attacks them," said CEO Michael O. Johnson in 2013.

The ol' Girl Scout defense - good one.    Hopefully the jury won't notice that GSA doesn't have a pyramid structure that funnels most of the profits to upper management.


No, they have a child-slavery-and-sell-off-real-estate structure that funnels the profits to the retirement funds of upper management.

But who gives a crap, as long as there are Thin Mints?
 
2014-03-12 06:34:10 PM  

Mad_Radhu: SecretAgentWoman: Um, I called this pyramid scheme out in the 90s. I figured it would have collapsed/been prosecuted by now. Geesh.

Hell, I remember people giving my parents the pitch back in the mid-80s. Even though I was a kid, I knew they were bad news because in the 80s GI Joe comic, Larry Hama explained that COBRA got all of their funding for troops and weapons through Herbalife and Amway style pyramid schemes.

/Larry Hama actually snuck a surprising amount of genuinely useful info into that comic, especially in the early issues before the demands of the toy line pushed things to the outlandish.


I loved that the comic actually had a semi plausible explanation for COBRA
 
2014-03-12 06:36:04 PM  

Ted_Peppy: So's Avon but they, like others, are too big now to go after.


I have a mental image of Mary Kay and the Girl Scouts having a turf war.  The girls pelt the cosmeticians with S'mores and then run away squealing with laughter, then the cosmeticians use lipstick to draw Joker-like grins on the girls.  Like WWII, but pinker and mint-flavored...
 
2014-03-12 06:46:25 PM  

Ted_Peppy: So's Avon but they, like others, are too big now to go after.


I was going to ask how Herbalife is different than Amway, Mary Kay, Avon, Origami Owl, Princess House, Party Lite, Pampered Chef, Thirty-One, Lia Sophia  and all the other stuff people are hocking so they get their wholesale discount.

/get invited to a lot of parties
//rarely attend one
 
2014-03-12 06:47:20 PM  

Adolf Oliver Nipples: Weird that the SEC is OK with him doing this.


You're surprised that the SEC doesn't have a problem with a rich white guy trying to make a stupidly large amount of money at the expense of someone other than richer white guys?
 
2014-03-12 06:48:08 PM  

TheDirtyNacho: The worst date I ever went on started meeting a girl in the toothpaste aisle at the supermarket and ended being pitched a MLM scheme over coffee.

Things got awkward when I questioned how it was not a pyramid scheme, and no, it's not a franchise like McDonalds and Wendys...


Similar thing happened to me.

CSB: I was picking up this hot, older woman (I was 19 and she was 27) and she ended up taking me to a pyramid marketing pitch meeting run by some smarmy guy. They asked if anyone had any questions at the end so I raised my hand... and proceeded to pick their business model apart. It wasn't hard... we were supposed to buy their "eco friendly" cleaning products from the company, then sell them and sign up our customers to sell them with each successive level of sales people getting a percentage of the sales below them.

I asked how it was going to be a sustainable business without infinite growth - which is impossible - and how all these ever growing levels of sales people (each taking a percentage) would not inflate the product prices to end users until the products were swiftly unsustainably expensive. Then before he could answer I added, "And furthermore, how will the company survive in the long term being that it is clearly a pyramid marketing scheme - which is illegal?"

The sales guy just was shocked for a few seconds... the pulled himself together, told me that this "fantastic opportunity" was obviously not for me and asked me to leave. The woman who tricked me in to going was mortified and I felt like I'd paid her back for the indignity. Neither of us ever called each other again of course.
 
2014-03-12 06:48:34 PM  
             I
           was
         under
       the idea
      Herbalife
     was totally
    a legitimate
  non-pyramidal
 scheme and not
a criminal  racket.
 
2014-03-12 06:49:50 PM  

Kinetic King: Pyramid scheme?  Had a couple of distant relatives who were into Amway.  They showed up at a family reunion (this was in the 80s) with a 16mm projector and the reunion turned into an Amway presentation.  I got the feeling that Amway was about 5% selling cleaning products and 95% getting all sorts of promotions like the Super Duper Three Diamond Cluster With Gold Leaf ranking.  Seriously, Mormon Scientologists look normal compared to these guys...


I thought of Amway, too.  I was once on friendly terms with some people who started selling those shiny tickets to cleanliness and financial prosperity.  I quickly "unfriended" them, and this was years before Facebook.
 
2014-03-12 06:50:21 PM  

tripleseven: TheDirtyNacho: The worst date I ever went on started meeting a girl in the toothpaste aisle at the supermarket and ended being pitched a MLM scheme over coffee.

Things got awkward when I questioned how it was not a pyramid scheme, and no, it's not a franchise like McDonalds and Wendys...

lol, you got burned.

Thought you were having a good day, cute chick in the toothpaste aisle...You start idle chat and bang, she's going on a date with you.


She had you clocked the minute you passed the crest.


That sucks though.

I thought I was the man when a cute girl approached me at the train station, turned out she was a Mormon on her spiritual quest or whatever.

it happens.


blog.chewxy.com
www.jamdeal.com

/it's MLM and Mormonism!
 
2014-03-12 06:53:52 PM  

Kinetic King: Pyramid scheme?  Had a couple of distant relatives who were into Amway.  They showed up at a family reunion (this was in the 80s) with a 16mm projector and the reunion turned into an Amway presentation.  I got the feeling that Amway was about 5% selling cleaning products and 95% getting all sorts of promotions like the Super Duper Three Diamond Cluster With Gold Leaf ranking.  Seriously, Mormon Scientologists look normal compared to these guys...


Amway exists so that the family idiot can support himself. Everybody needs to buy toothpaste and detergent, why not buy it from cousin Billy-Joe who failed third grade?
 
2014-03-12 06:56:20 PM  
Okay, the pyramid scheme thing always confuses me.  Maybe I'm misunderstanding the definition.  I would assume that things like Mary Kay, Pampered Chef, and that one where women are "empowered" by selling them sex toys in some greedy skank's living room, would be considered pyramid schemes.  If so, though, why doesn't the law come down on them?
 
2014-03-12 06:59:23 PM  

Adolf Oliver Nipples: ClavellBCMI: Considering the guy leading the charge against Herbalife has a $1 *billion* short against their stock, and will profit *only* if Herbalife's stock takes a tumble, there's nothing fishy going on at all concerning this investigation. Now, is Herbalife a collection of money-grubbing low-life scumbags running a pyramid scheme? Quite possible. But it sure as shiat would have helped having faith in a fair and honest investigation if this investigation hadn't been pushed so hard by the one guy certain to make a literal fortune if the company goes under.

This. Isn't this the textbook definition of the pump-and-dump, taking a position and then publicly pushing that position for your own benefit? Weird that the SEC is OK with him doing this.


They will probably only investigate him if Herbalife does, indeed, go under and his shorting of Herbalife does, indeed, earn him his money. And then, only if his bribe money fails to materialize.
 
2014-03-12 06:59:37 PM  

TheDirtyNacho: The worst date I ever went on started meeting a girl in the toothpaste aisle at the supermarket and ended being pitched a MLM scheme over coffee.

Things got awkward when I questioned how it was not a pyramid scheme, and no, it's not a franchise like McDonalds and Wendys...


CSB ahoy!

I was working at CompUSA in 98-99, and we'd get these people in at a rate of about one every few months.  I slung desktops and laptops then, and I could always spot them the minute they whipped out their little credit-card sized CD's to ask if they'd work in the CD-ROM drive.  I'd oblige because I had to, and I'd always try to test their resolve by intentionally looking away as the presentation was playing, trying to see how much they'd try to keep my attention.  I'll admit though, the first one hooked me in, but when we met at a Dennys so he could make the full-throated pitch, I had a good feeling something was amiss.
 
2014-03-12 07:01:03 PM  
i.imgur.com

The government process.
 
2014-03-12 07:01:48 PM  

Oh-Blonde-One: Ted_Peppy: So's Avon but they, like others, are too big now to go after.

I was going to ask how Herbalife is different than Amway, Mary Kay, Avon, Origami Owl, Princess House, Party Lite, Pampered Chef, Thirty-One, Lia Sophia  and all the other stuff people are hocking so they get their wholesale discount.

/get invited to a lot of parties
//rarely attend one


Out of all of those, Pampered Chef is the only one I'd even remotely consider. I once lived with a female friend who sold P.C. She did a hell of a lot of cooking with their products, as did I, and I was impressed; they make some quality shiat for the home market. It's stuff I would actually feel comfortable about selling, and I'm normally a horrible salesman.

Also, from what I understand, most of their sales lines are produced from people who have actually used the stuff, and asked about getting into it on their own, instead of having the concept sold to them.
 
2014-03-12 07:02:24 PM  

Adolf Oliver Nipples: ClavellBCMI: Considering the guy leading the charge against Herbalife has a $1 *billion* short against their stock, and will profit *only* if Herbalife's stock takes a tumble, there's nothing fishy going on at all concerning this investigation. Now, is Herbalife a collection of money-grubbing low-life scumbags running a pyramid scheme? Quite possible. But it sure as shiat would have helped having faith in a fair and honest investigation if this investigation hadn't been pushed so hard by the one guy certain to make a literal fortune if the company goes under.

This. Isn't this the textbook definition of the pump-and-dump, taking a position and then publicly pushing that position for your own benefit? Weird that the SEC is OK with him doing this.


Well, the man traded on public knowledge and has taken a public position calling for a public investigation. The fact he waited until the company wore out even the hispanics and the company is about to stumble is questionable. Shoulda stopped over a decade ago.

If the SEC is going to go after someone for dissing a company and taking the position, then they'd have to go after people who cheer on a company and take the position.
 
2014-03-12 07:05:54 PM  

ClavellBCMI: Considering the guy leading the charge against Herbalife has a $1 *billion* short against their stock, and will profit *only* if Herbalife's stock takes a tumble, there's nothing fishy going on at all concerning this investigation. Now, is Herbalife a collection of money-grubbing low-life scumbags running a pyramid scheme? Quite possible. But it sure as shiat would have helped having faith in a fair and honest investigation if this investigation hadn't been pushed so hard by the one guy certain to make a literal fortune if the company goes under.


Yeah. But hes a democrat. Only rich conservatives are evil.
 
2014-03-12 07:06:48 PM  
The ex-fiance tried to get me into one of those, after we broke up, of course.  The unemployment benefits dried up and she started into this with a lot of passion.  I calmly explained to her what a pyramid scheme was, how they worked, and that it was against the law. ... Never heard about that again.  She did try to get employee pricing for a shiat-ton of color copies at a later date.  She was doing a presentation about the company to a bunch of her relatives and wanted to look well-off enough to afford the presentation in color.  Tried to talk me into getting a five finger discount first, but I wanted to keep my job and not get black-listed from the industry for theft.

/told her to go fly a kite after she called a few months back: i've switched industries and am not looking back
 
2014-03-12 07:08:13 PM  

Valiente: /it's MLM and Mormonism!


They go together like bread and butter.  There are hundreds of MLMs out of Utah.  I also know people who got into these life-sucks through Jehovahs' Witness, Christian Scientist, and Seventh-Day Adventist networks.

I figure, you've got a lot of people who, besides being good at swallowing bullshiat, have lots of practice with bugging people, having door slammed in their faces, and having people look at them like they were short-bus riders.
 
2014-03-12 07:08:29 PM  

HortusMatris: Okay, the pyramid scheme thing always confuses me.  Maybe I'm misunderstanding the definition.  I would assume that things like Mary Kay, Pampered Chef, and that one where women are "empowered" by selling them sex toys in some greedy skank's living room, would be considered pyramid schemes.  If so, though, why doesn't the law come down on them?


It sounds like (according to the guy in the article anyway) that the main difference between Herbalife and other MLM companies is that the other companies actually sell stuff to people who are not involved with the company.  According to him, the only people buying Herbalife products are the people selling it.  They're buying the merchandise for themselves.
 
2014-03-12 07:11:14 PM  

Fano: Mad_Radhu: SecretAgentWoman: Um, I called this pyramid scheme out in the 90s. I figured it would have collapsed/been prosecuted by now. Geesh.

Hell, I remember people giving my parents the pitch back in the mid-80s. Even though I was a kid, I knew they were bad news because in the 80s GI Joe comic, Larry Hama explained that COBRA got all of their funding for troops and weapons through Herbalife and Amway style pyramid schemes.

/Larry Hama actually snuck a surprising amount of genuinely useful info into that comic, especially in the early issues before the demands of the toy line pushed things to the outlandish.

I loved that the comic actually had a semi plausible explanation for COBRA


I need to find the comic where it says this.

/Do you know what number it was?
 
2014-03-12 07:11:49 PM  

Oh-Blonde-One: I was going to ask how Herbalife is different than Amway, Mary Kay, Avon, Origami Owl, Princess House, Party Lite, Pampered Chef, Thirty-One, Lia Sophia and all the other stuff people are hocking so they get their wholesale discount.


If people are hocking the stuff for the wholesale/employee discount, it's scummy and desperate but legal.

If people pay to join the so-called business -- whether directly as a "membership fee" or mandatory "training", or indirectly through a required purchase -- and earlier joiners only get paid out when they recruit enough people below them, it's a pyramid scheme. In situations like this it's pretty clear that the whole thing will collapse when the scheme runs out of recruits.

Unfortunately there's a big grey area in the middle. Most MLM businesses have a mixture of recruiting fees and actual product; and many modern outright scams have a nominal product specifically to disguise the true nature;  and there's no hard and fast rule that says that when a business makes more money selling courses and manuals and training to its own employees than it makes selling product to end customers, then the FTC will pay attention.

But for my money, any time people are getting paid more for recruiting new members than for selling product, it's fishy. (And frankly I would stay away from any MLM business on principle.)
 
2014-03-12 07:14:18 PM  
My big grin was when someone tried to pitch a carburetor design that would save gas,but "the big auto makers don't want you to know this."

Not sure if he expected me to buy his plans and have it fabricated at a machine shop. I quietly pass by secrets that are still secrets because no one wants them.

Now carburetors have been replaced by fuel injection.
 
2014-03-12 07:14:50 PM  

HortusMatris: Okay, the pyramid scheme thing always confuses me.  Maybe I'm misunderstanding the definition.  I would assume that things like Mary Kay, Pampered Chef, and that one where women are "empowered" by selling them sex toys in some greedy skank's living room, would be considered pyramid schemes.  If so, though, why doesn't the law come down on them?


The classic pyramid scheme is essentially the same as the chain letter asking you to send a dollar to the sender and passing the letter on to five other friends asking them to send you a dollar.  This is illegal under gambling laws.

Amway and other such companies make the process rather voluntary and there are certain procedures in place that keep them inside the law.  They are also private companies with no public stock.  Herbalife went public in 2004.

/I could be wrong about this
//My last research into this area was a couple of decades ago.
 
2014-03-12 07:15:41 PM  

wildcardjack: Adolf Oliver Nipples: ClavellBCMI: Considering the guy leading the charge against Herbalife has a $1 *billion* short against their stock, and will profit *only* if Herbalife's stock takes a tumble, there's nothing fishy going on at all concerning this investigation. Now, is Herbalife a collection of money-grubbing low-life scumbags running a pyramid scheme? Quite possible. But it sure as shiat would have helped having faith in a fair and honest investigation if this investigation hadn't been pushed so hard by the one guy certain to make a literal fortune if the company goes under.

This. Isn't this the textbook definition of the pump-and-dump, taking a position and then publicly pushing that position for your own benefit? Weird that the SEC is OK with him doing this.

Well, the man traded on public knowledge and has taken a public position calling for a public investigation. The fact he waited until the company wore out even the hispanics and the company is about to stumble is questionable. Shoulda stopped over a decade ago.

If the SEC is going to go after someone for dissing a company and taking the position, then they'd have to go after people who cheer on a company and take the position.


Hes using his political connections to spur the investigations.
 
2014-03-12 07:17:52 PM  
I have lost a couple for what i thought were good friends over this, they surprise drop the pitch on you and then you point out that the profit model forms the shape of a pyramid and while it may not be a scheme per say it is.

They get so mad and honestly it takes a certain personality to want to sell things like this anyhow and I dont have it and they try to tell you that it will change once you see all the money coming in.

Like an odd vitamin pushing group of cults.
 
2014-03-12 07:19:51 PM  

ReverendJynxed: [i.imgur.com image 850x401]

The government process.


Thanks! I forgot all about that thing.
 
2014-03-12 07:33:05 PM  

trippdogg: "Girl Scouts sell cookies on a direct-selling method, and nobody attacks them," said CEO Michael O. Johnson in 2013.

The ol' Girl Scout defense - good one.    Hopefully the jury won't notice that GSA doesn't have a pyramid structure that funnels most of the profits to upper management.


Yeah, it isn't like the Girl Scouts are out there at the stores trying to get you to sell cookies for them.

Although, don't give them any ideas.
 
2014-03-12 07:34:55 PM  

ReverendJynxed: [i.imgur.com image 850x401]

The government process.


I had to go and let Jeff Goldblum  watch me. While there I wondered if anyone has ever figured out the torque at the end of it. Has to be astronomical.
 
2014-03-12 07:35:24 PM  
The Mormans, JW's, and others  of their ilk like to do business with each other, so they have a pretty guaranteed market for most of this stuff.  I'm sure there's a bible verse they mis-interpret that commands them to do this.

Not a CSB:  We had very good friends year ago that lived in another city.  From time to time we'd make a weekend out of heading off to visit each other.  So off we go to their place and discover that he has sold off his share in daddy's business and bought in at a mid to high level of Amway. First night with them we had to go to a meeting.  It was lie a religious revival.  The speaker had been a down in the dregs wino but Amway saved his soul and delivered him to the Altar of Consumerism.  Now he was rolling in dough (turned out that wasn't quite true, the dough part.)  My friend thought this was the best way to spend an evening.  He mocked me my 9 to 5 job.  When he wanted to take off in the middle of the day to play golf, he just went.  he was his own boss.  I had to pay homage to the man, what a sucker I was.  So later, like 3 in the morning, I hear the phone ring.  One of his "downline" in having marital problems and kept my friend on the phone past our 8 AM breakfast crying on his  shoulder.  When he finally was free, I told him I may have to put in a full 8 hours, but I don't have to play marriage counselor at 3 AM.

When we left, my wife felt obligated to buy something.  She got the run proof pantyhose.  They didn't last through the first wearing, and cost triple what she used to pay.  Within a year, he had lost pretty much everything he had and was back working for his dad as an employee, not a part owner.   And we never saw them again.  #sadstorybro
 
2014-03-12 07:44:50 PM  
Newest thing I've seen being pushed on "friends" is Younique makeup. Sounds very much like a pyramid scheme to me. Anyone have any experience with them?
 
2014-03-12 07:50:23 PM  
...and this is why I'm a fan of Major League Soccer.  Through the fact that Amway, Herbalife, Advocare, Xango, LifeVantage, and probably one more I'm forgetting have sponsored teams through the years, I'm well versed in which companies are MLMs and to stay the hell away from them
 
2014-03-12 07:52:50 PM  
The most annoying thing that MLM and other scammers do is "carpet bomb" the net with favorable reviews of themselves. So say, you Google the scammer's name + the word "scam" or "Fraud", the majority of your results will be positive (and supposedly UNBIASED!)

And they ensure any Wikipedia pages are positive.  Here's a typical example of an MLM company Wiki Pages.

http://en.wikipedia.org/wiki/ACN_Inc   (I attended one of their sessions. It's very obvious they are MLM and a waste of time)

They must have full-time web editors or bots furiously posting positive reviews.
 
2014-03-12 07:53:36 PM  

mongbiohazard: TheDirtyNacho: The worst date I ever went on started meeting a girl in the toothpaste aisle at the supermarket and ended being pitched a MLM scheme over coffee.

Things got awkward when I questioned how it was not a pyramid scheme, and no, it's not a franchise like McDonalds and Wendys...

Similar thing happened to me.

CSB: I was picking up this hot, older woman (I was 19 and she was 27) and she ended up taking me to a pyramid marketing pitch meeting run by some smarmy guy. They asked if anyone had any questions at the end so I raised my hand... and proceeded to pick their business model apart. It wasn't hard... we were supposed to buy their "eco friendly" cleaning products from the company, then sell them and sign up our customers to sell them with each successive level of sales people getting a percentage of the sales below them.

I asked how it was going to be a sustainable business without infinite growth - which is impossible - and how all these ever growing levels of sales people (each taking a percentage) would not inflate the product prices to end users until the products were swiftly unsustainably expensive. Then before he could answer I added, "And furthermore, how will the company survive in the long term being that it is clearly a pyramid marketing scheme - which is illegal?"

The sales guy just was shocked for a few seconds... the pulled himself together, told me that this "fantastic opportunity" was obviously not for me and asked me to leave. The woman who tricked me in to going was mortified and I felt like I'd paid her back for the indignity. Neither of us ever called each other again of course.


I got suckered into one of those meetings; it was a long time ago, the late 70s.  I remember the overly enthusiastic ringleader who was SO EXCITED!!!  His  charts and diagrams with boxes and arrows SO EXCITING!! pointing all sorts of directions showing how simple, with AMWAY, you will make so money you can buy your dream home, a 75' yacht, luxury cars-- whatever your greedy heart desired .  What really made me sick about the whole thing was at one point, "churchy" music began playing and everyone stood up, held hands and sang the pseudo religious "Amway Hymn".
 
2014-03-12 08:00:10 PM  

ClavellBCMI: Considering the guy leading the charge against Herbalife has a $1 *billion* short against their stock, and will profit *only* if Herbalife's stock takes a tumble, there's nothing fishy going on at all concerning this investigation. Now, is Herbalife a collection of money-grubbing low-life scumbags running a pyramid scheme? Quite possible. But it sure as shiat would have helped having faith in a fair and honest investigation if this investigation hadn't been pushed so hard by the one guy certain to make a literal fortune if the company goes under.


You forgot 2 rich guys are in feud over this company. Not just one. Both trying to screw the other over.
 
2014-03-12 08:03:19 PM  

Lawnchair: Valiente: /it's MLM and Mormonism!

They go together like bread and butter.  There are hundreds of MLMs out of Utah.  I also know people who got into these life-sucks through Jehovahs' Witness, Christian Scientist, and Seventh-Day Adventist networks.

I figure, you've got a lot of people who, besides being good at swallowing bullshiat, have lots of practice with bugging people, having door slammed in their faces, and having people look at them like they were short-bus riders.



Big personal networks (ie, families) where people are familiar with each other are MLM territory.  Herbalife's turf is often in hispanic communities.
 
2014-03-12 08:06:43 PM  

Longtime Lurker: ...and this is why I'm a fan of Major League Soccer.  Through the fact that Amway, Herbalife, Advocare, Xango, LifeVantage, and probably one more I'm forgetting have sponsored teams through the years, I'm well versed in which companies are MLMs and to stay the hell away from them


Could be worse.

www.thevitalword.com
 
2014-03-12 08:13:33 PM  

rugman11: Longtime Lurker: ...and this is why I'm a fan of Major League Soccer.  Through the fact that Amway, Herbalife, Advocare, Xango, LifeVantage, and probably one more I'm forgetting have sponsored teams through the years, I'm well versed in which companies are MLMs and to stay the hell away from them

Could be worse.


It's no longer called that. Owners changed the name after he came out as a doper.
 
2014-03-12 08:18:06 PM  

HortusMatris: Okay, the pyramid scheme thing always confuses me.  Maybe I'm misunderstanding the definition.  I would assume that things like Mary Kay, Pampered Chef, and that one where women are "empowered" by selling them sex toys in some greedy skank's living room, would be considered pyramid schemes.  If so, though, why doesn't the law come down on them?


So long as you're supposed to be making money selling something to non-members it doesn't qualify.  Where it falls apart is when there's a membership fee you pay up the chain that's bigger than the product sales, or when, like with Herbalife, no one is successfully selling to outsiders, just buying for themselves and recruiting new members.
 
2014-03-12 08:20:09 PM  
My wife has knows two people into the Pampered Chef and they both seem to be selling to other people and not doing recruitment, either that or they really know my wife.  We have a few things from them and they have all been very good, especially the can opener which I love and use all the time.

My sister did Avon for a little while while she was working at an entry level job just out of college and she seemed to be all sales and not recruitment, but that was in the 1970's so it has probably changed. Haven't really hear much about them in years until someone just donated some Avon products to a charity silent auction my wife helped to run.

On the other hand everyone I know touched by Amway has turned into a complete loon, and you are a mark to be their "downline" or you are a source of negative energy and they cut you off.  I had a close friend who went through this and ended up bankrupt instead of rich, at least he is out of it now and we can be friends again.
 
2014-03-12 08:24:09 PM  

interstellar_tedium: My wife has knows two people into the Pampered Chef and they both seem to be selling to other people and not doing recruitment, either that or they really know my wife.  We have a few things from them and they have all been very good, especially the can opener which I love and use all the time.

My sister did Avon for a little while while she was working at an entry level job just out of college and she seemed to be all sales and not recruitment, but that was in the 1970's so it has probably changed. Haven't really hear much about them in years until someone just donated some Avon products to a charity silent auction my wife helped to run.

On the other hand everyone I know touched by Amway has turned into a complete loon, and you are a mark to be their "downline" or you are a source of negative energy and they cut you off.  I had a close friend who went through this and ended up bankrupt instead of rich, at least he is out of it now and we can be friends again.



Gotta love how "questions the BS" means "negative energy".  Scientology and other cults have the same MO.
 
2014-03-12 08:25:40 PM  

Oh-Blonde-One: Ted_Peppy: So's Avon but they, like others, are too big now to go after.

I was going to ask how Herbalife is different than Amway, Mary Kay, Avon, Origami Owl, Princess House, Party Lite, Pampered Chef, Thirty-One, Lia Sophia  and all the other stuff people are hocking so they get their wholesale discount.

/get invited to a lot of parties
//rarely attend one


Avon, girl scouts, all other door-to-door salesmen make money by selling something. With Herbalife, Amway, etc. you can't make the real money merely by selling; you need to convince OTHER people to sell things WITH you. Then they realize they don't get paid big money unless THEY sign someone else up to work with THEM, who in turn needs to sign someone ELSE up, and right pronto you have a pyramid.

Real sales comissions are based off goods sold, not off of a chain letter. If any 'sales' job tells you that you getpaid when your chain letter completes, run the f#ck away, because they're not making profits as much as they're paying forward 'subscription' fees.
 
2014-03-12 08:39:09 PM  
Their wikipedia page claims they have 6,000 employees.  That's proof that wikipedia can't always be trusted.  It's more like 200 hundred corporate employees working hard to scam 5800 suckers.
 
2014-03-12 08:42:08 PM  

Longtime Lurker: ...and this is why I'm a fan of Major League Soccer.  Through the fact that Amway, Herbalife, Advocare, Xango, LifeVantage, and probably one more I'm forgetting have sponsored teams through the years, I'm well versed in which companies are MLMs and to stay the hell away from them


During local Galaxy telecasts, there was always an Herbalife commercial w/ one of the most beautiful women in the world jumping out of the pool in a bikini in slow motion w/ shiatty honky tonk music.
 
2014-03-12 08:47:31 PM  

Trocadero: Longtime Lurker: ...and this is why I'm a fan of Major League Soccer.  Through the fact that Amway, Herbalife, Advocare, Xango, LifeVantage, and probably one more I'm forgetting have sponsored teams through the years, I'm well versed in which companies are MLMs and to stay the hell away from them

During local Galaxy telecasts, there was always an Herbalife commercial w/ one of the most beautiful women in the world jumping out of the pool in a bikini in slow motion w/ shiatty honky tonk music.


Well as a Union fan, I get a really creepy cartoon bear.
 
2014-03-12 08:52:22 PM  
A friend I met in an online game suddenly turned to Herbalife; he went from being ultra popular to being avoided by everyone. Last i checked he was still at it.
 
2014-03-12 08:58:14 PM  
Horrible-Life.

When you learn that founder of the company Mark Hughes od'd on alcohol and Doxepin (an anti-depressant) and went to multi-level heaven at age 44 a certain bell starts ringing madly.

Now they're big in third-world countries, in a rising and naive middle class with plenty of fresh disposable income. Here in Jakarta they have the ground floor on a prominent office building, and are recruiting all sorts of eager-beaver salespeople, poor saps.

CSB/: Before they lost the court case and were banned from trying to recruit passersby in airports the nicely-dressed, good-looking young ladies who were actually Children of God drones or Hare Krishna puppets or Unification Church units would waylay likely-looking suckers - lonely young soldier boys or college kids for instance.

They'd engage these innocents in friendly conversation with lots of sexy eye contact and then BAM they've sold the mark one of the Toppan-printed full-color Bhaktivedanta books for a hundred bucks, or ensnared him into a friendly session somewhere else (expect pu33y, instead get harangued at by a team of seven religious nuts).

We cult saboteurs would stroll by these setups innocently just as the vampires were reeling in a mark and start clicking little metal clackers, you know, those toy frogs or whatever that produce a sharp noise. Immediately the sucker gets distracted, the evil cultie gets an alarmed look on her face and the trance snaps. GAME OVER honey and there ain't nothin' you can do about it.

Fun times. Farkem. Moon the Moonies

"Son, a fool and his money are soon parted" - the late Lt. Col. Byron A. Black, USAF (Ret) looking steadily at me.
 
2014-03-12 08:59:18 PM  

Rodeodoc: Now he was rolling in dough (turned out that wasn't quite true, the dough part.)


Ah, "fake it till you make it".  I asked my cousin about that (can't remember if it was Arbonne, Xango, or Genesis Pure... she's a repeat-sucker).  I said, if your 'national vice president' (upline) is suggesting you make yourself out to be more successful than you are, maybe she isn't very successful either.  She was constantly re-tweeting this person... who I'm not entirely convinced really existed (may have been a fictional corporate face).

Sim Tree: With Herbalife, Amway, etc. you can't make the real money merely by selling; you need to convince OTHER people to sell things WITH you. Then they realize they don't get paid big money unless THEY sign someone else up to work with THEM, who in turn needs to sign someone ELSE up, and right pronto you have a pyramid.


A lot of the money is also in selling "how to grow your X business and generate more leads in six easy steps" books, seminars, audiotapes, retreats, etc, etc, etc.
 
2014-03-12 09:04:55 PM  
I can speak to the Mary Kay thing. They work on both selling and recruiting. You sell a lipstick as a consultant (lowest level), you keep 50% the rest goes to the company and your director. From what I understand about pyramid schemes, the person at the bottom always gets left holding the bag. With Mary Kay, you always get 50% of what you sell. They also emphasize recruiting so that you become a director and you get a bigger cut.  Some people like to just sell and others like to recruit.  I've seen women that are just natural sales people do really well and others get frustrated and try to unload everything they have in their stock. They can be a little high pressure with their recruiting but on the other hand I've heard women say they wouldn't use any other product so there you go.
 
2014-03-12 09:08:41 PM  
Dow Jones and the Temple of Doom:

I've seen it happen too. Almost happened to me with the gym chick. Seems a bit of a dangerous sales strategy to flirt with and go on pretend-dates with guys to try and sell them on a MLM scam. End up leading on the wrong guy...

Oh well, beats working for a living, I guess.


What? Being a serial killer?
 
2014-03-12 09:10:42 PM  

Dow Jones and the Temple of Doom: There was a fugly girl with big fake tits at my gym, she chatted me up and tried to sell me on this shiat. Wore a big button on her boob that said "Want to lose weight? Ask me how!"

She said the power drink mix had "more nutrients than 5 salads" and "makes your hair grow so fast you'll to get it cut once a week." Wtf


A bushel of apples packed in each bar, plus a secret ingredient that unleashes the awesome power of apples!!

i59.tinypic.com
 
2014-03-12 09:13:14 PM  
You might say "yeah, that's all right for the fellas, but what about the fine ladies?"


I was washing my dishes in the bathtub, and I smoked pot all day long until I got...

MY NEW BRAIN!
 
2014-03-12 09:16:41 PM  

illannoyin: Fano: Mad_Radhu: SecretAgentWoman: Um, I called this pyramid scheme out in the 90s. I figured it would have collapsed/been prosecuted by now. Geesh.

Hell, I remember people giving my parents the pitch back in the mid-80s. Even though I was a kid, I knew they were bad news because in the 80s GI Joe comic, Larry Hama explained that COBRA got all of their funding for troops and weapons through Herbalife and Amway style pyramid schemes.

/Larry Hama actually snuck a surprising amount of genuinely useful info into that comic, especially in the early issues before the demands of the toy line pushed things to the outlandish.

I loved that the comic actually had a semi plausible explanation for COBRA

I need to find the comic where it says this.

/Do you know what number it was?


Issue 84 according to Google. http://www.option38.com/comics/gijoe/84.asp

// Google, how does it work?
 
2014-03-12 09:22:08 PM  
I'm not completely sure about this, but Advocare is one of these companies, correct?  I had a coworker telling me all about one of his friends who was an Advocare guy, telling me all about how much money the guy was making blah blah blah, and I told him it sounded like a pyramid scheme.  As far as I know, he still hasn't gotten into it, which I'm prettty happy about.  He's a nice guy, but a bit of a sucker.
 
2014-03-12 09:22:45 PM  
Anybody check Free Republic to see the reaction over there to this news? I say that because half of the people who claim to be Right Wing small business owners in internet threads are claiming there Amway, Herbalife or other MLM scheme as a small business. These guys really got to be in a rage over this.
 
2014-03-12 09:26:12 PM  

czetie: Oh-Blonde-One: I was going to ask how Herbalife is different than Amway, Mary Kay, Avon, Origami Owl, Princess House, Party Lite, Pampered Chef, Thirty-One, Lia Sophia and all the other stuff people are hocking so they get their wholesale discount.

If people are hocking the stuff for the wholesale/employee discount, it's scummy and desperate but legal.

If people pay to join the so-called business -- whether directly as a "membership fee" or mandatory "training", or indirectly through a required purchase -- and earlier joiners only get paid out when they recruit enough people below them, it's a pyramid scheme. In situations like this it's pretty clear that the whole thing will collapse when the scheme runs out of recruits.

Unfortunately there's a big grey area in the middle. Most MLM businesses have a mixture of recruiting fees and actual product; and many modern outright scams have a nominal product specifically to disguise the true nature;  and there's no hard and fast rule that says that when a business makes more money selling courses and manuals and training to its own employees than it makes selling product to end customers, then the FTC will pay attention.

But for my money, any time people are getting paid more for recruiting new members than for selling product, it's fishy. (And frankly I would stay away from any MLM business on principle.)


I don't understand why it's scummy or desperate.  If you're going to use the product (such as Mary Kay), why not get your own product at wholesale prices?  That way, you only have to sell enough to keep your membership / account active.

I understand that most of these fall into the grey area in the middle, but didn't understand how Herbalife was different (some other posters speculated as to how though).
 
2014-03-12 09:33:27 PM  

TheDirtyNacho: interstellar_tedium: My wife has knows two people into the Pampered Chef and they both seem to be selling to other people and not doing recruitment, either that or they really know my wife.  We have a few things from them and they have all been very good, especially the can opener which I love and use all the time.

My sister did Avon for a little while while she was working at an entry level job just out of college and she seemed to be all sales and not recruitment, but that was in the 1970's so it has probably changed. Haven't really hear much about them in years until someone just donated some Avon products to a charity silent auction my wife helped to run.

On the other hand everyone I know touched by Amway has turned into a complete loon, and you are a mark to be their "downline" or you are a source of negative energy and they cut you off.  I had a close friend who went through this and ended up bankrupt instead of rich, at least he is out of it now and we can be friends again.


Gotta love how "questions the BS" means "negative energy".  Scientology and other cults have the same MO.


It has been pretty frightening to see, and its not just "questions the BS" but its also just saying "no I don't want to sell" that sets them off.  Even just politely buying a bottle or two of whatever does not suffice, you have to be part of the downline or they don't want to spend time with you as they could be out recruiting someone new.  It is sad what MLM does to families and friends, people become marks and not who you love.
 
2014-03-12 09:34:36 PM  

Mad_Radhu: Hell, I remember people giving my parents the pitch back in the mid-80s. Even though I was a kid, I knew they were bad news because in the 80s GI Joe comic, Larry Hama explained that COBRA got all of their funding for troops and weapons through Herbalife and Amway style pyramid schemes.


I would really, really like to see that comic if someone can find it.  I know GI Joe had some good info in their "Knowing is Half the Battle" segments, but if this is true I've gained even more respect for the comic/cartoon/line/etc.
 
2014-03-12 09:38:32 PM  

yukichigai: Mad_Radhu: Hell, I remember people giving my parents the pitch back in the mid-80s. Even though I was a kid, I knew they were bad news because in the 80s GI Joe comic, Larry Hama explained that COBRA got all of their funding for troops and weapons through Herbalife and Amway style pyramid schemes.

I would really, really like to see that comic if someone can find it.  I know GI Joe had some good info in their "Knowing is Half the Battle" segments, but if this is true I've gained even more respect for the comic/cartoon/line/etc.


Just to recap:
Issue 84 according to Google. http://www.option38.com/comics/gijoe/84.asp
 
2014-03-12 09:41:30 PM  

Big Ramifications: illannoyin: Fano: Mad_Radhu: SecretAgentWoman: Um, I called this pyramid scheme out in the 90s. I figured it would have collapsed/been prosecuted by now. Geesh.

Hell, I remember people giving my parents the pitch back in the mid-80s. Even though I was a kid, I knew they were bad news because in the 80s GI Joe comic, Larry Hama explained that COBRA got all of their funding for troops and weapons through Herbalife and Amway style pyramid schemes.

/Larry Hama actually snuck a surprising amount of genuinely useful info into that comic, especially in the early issues before the demands of the toy line pushed things to the outlandish.

I loved that the comic actually had a semi plausible explanation for COBRA

I need to find the comic where it says this.

/Do you know what number it was?

Issue 84 according to Google. http://www.option38.com/comics/gijoe/84.asp

// Google, how does it work?


I could have sworn it was explicitly said earlier, in the issues where CC was unmasked and bonding with his son Billy.

Oh, and long before the Simpsons, the use of "Springfield" as COBRA "company towns" was a neat trick. The movie Arlington road's antagonist could have been one of the "Freds."
 
2014-03-12 09:45:17 PM  

yukichigai: Mad_Radhu: Hell, I remember people giving my parents the pitch back in the mid-80s. Even though I was a kid, I knew they were bad news because in the 80s GI Joe comic, Larry Hama explained that COBRA got all of their funding for troops and weapons through Herbalife and Amway style pyramid schemes.

I would really, really like to see that comic if someone can find it.  I know GI Joe had some good info in their "Knowing is Half the Battle" segments, but if this is true I've gained even more respect for the comic/cartoon/line/etc.


It was scattered through the backstory, but it was first mentioned in issue #10 when Snake Eyes and Scarlett are captured by COBRA and interrogated at their secret base in a non-descript town called Springfield (funnily enough, when they escape at the end of the issue they aren't quite sure WHICH Springfield was the town they were in because it was so generic, which predates the Simpsons Springfield which is located at the four corners of Maine, Ohio, Nevada, and Kentucky). Issue 38 also dealt with it as well. This site has a pretty good run down.
 
2014-03-12 09:55:15 PM  

Mad_Radhu: yukichigai: Mad_Radhu: Hell, I remember people giving my parents the pitch back in the mid-80s. Even though I was a kid, I knew they were bad news because in the 80s GI Joe comic, Larry Hama explained that COBRA got all of their funding for troops and weapons through Herbalife and Amway style pyramid schemes.

I would really, really like to see that comic if someone can find it.  I know GI Joe had some good info in their "Knowing is Half the Battle" segments, but if this is true I've gained even more respect for the comic/cartoon/line/etc.

It was scattered through the backstory, but it was first mentioned in issue #10 when Snake Eyes and Scarlett are captured by COBRA and interrogated at their secret base in a non-descript town called Springfield (funnily enough, when they escape at the end of the issue they aren't quite sure WHICH Springfield was the town they were in because it was so generic, which predates the Simpsons Springfield which is located at the four corners of Maine, Ohio, Nevada, and Kentucky). Issue 38 also dealt with it as well. This site has a pretty good run down.


That is... insane.  Wow.  I had no idea how damn insightful that comic really was.
 
2014-03-12 09:55:35 PM  
content8.flixster.comman!
 
2014-03-12 10:02:28 PM  
mongbiohazard:
The sales guy just was shocked for a few seconds... the pulled himself together, told me that this "fantastic opportunity" was obviously not for me and asked me to leave. The woman who tricked me in to going was mortified and I felt like I'd paid her back for the indignity. Neither of us ever called each other again of course.

Should have at least asked for a blowjob or anal for the bullshiat of being tricked into a team pyramid scheme recruitment.
 
2014-03-12 10:13:22 PM  

Mad_Radhu: yukichigai: Mad_Radhu: Hell, I remember people giving my parents the pitch back in the mid-80s. Even though I was a kid, I knew they were bad news because in the 80s GI Joe comic, Larry Hama explained that COBRA got all of their funding for troops and weapons through Herbalife and Amway style pyramid schemes.

I would really, really like to see that comic if someone can find it.  I know GI Joe had some good info in their "Knowing is Half the Battle" segments, but if this is true I've gained even more respect for the comic/cartoon/line/etc.

It was scattered through the backstory, but it was first mentioned in issue #10 when Snake Eyes and Scarlett are captured by COBRA and interrogated at their secret base in a non-descript town called Springfield (funnily enough, when they escape at the end of the issue they aren't quite sure WHICH Springfield was the town they were in because it was so generic, which predates the Simpsons Springfield which is located at the four corners of Maine, Ohio, Nevada, and Kentucky). Issue 38 also dealt with it as well. This site has a pretty good run down.


Thanks for the clarification. I did a rudimentary search using cobra herbalife "gi joe" and grabbed the 1st relevant result.

From the #10 summary: Springfield was an ordinary town until the "soap people" arrived and began their pyramid scheme of selling cleaning products. Sales meetings soon became "indoctrination seminars" and soon the whole town was taken over. All of the buildings conceal Cobra hardware of some sort.

From the #84 summary: CC clarifies that while they'll sell vitamins and cleaning products...they're actually selling the IDEA of selling vitamin and cleaning products. "Vitamins" have now been added to Cobra's evil schemes. So stuff like HerbaLife and other door-to-door vitamin schemes of the 80's are now included. They're EVIL!

http://www.option38.com/comics/gijoe/10.asp
 
2014-03-12 10:15:14 PM  
The math works out that for any expected-to-recruit-five-suckers pyramid scam, roughly 80% of the pyramid at all times will have no recruits at all.

/  I love the suckers who object "It's not a pyramid! Pyramids are illegal!" but don't at all mind you flipping the diagram over and calling it a tree.

Mad_Radhu: four corners of Maine, Ohio, Nevada, and Kentucky)


Maine?
 
2014-03-12 10:18:56 PM  

yukichigai: Mad_Radhu: yukichigai: Mad_Radhu: Hell, I remember people giving my parents the pitch back in the mid-80s. Even though I was a kid, I knew they were bad news because in the 80s GI Joe comic, Larry Hama explained that COBRA got all of their funding for troops and weapons through Herbalife and Amway style pyramid schemes.

I would really, really like to see that comic if someone can find it.  I know GI Joe had some good info in their "Knowing is Half the Battle" segments, but if this is true I've gained even more respect for the comic/cartoon/line/etc.

It was scattered through the backstory, but it was first mentioned in issue #10 when Snake Eyes and Scarlett are captured by COBRA and interrogated at their secret base in a non-descript town called Springfield (funnily enough, when they escape at the end of the issue they aren't quite sure WHICH Springfield was the town they were in because it was so generic, which predates the Simpsons Springfield which is located at the four corners of Maine, Ohio, Nevada, and Kentucky). Issue 38 also dealt with it as well. This site has a pretty good run down.

That is... insane.  Wow.  I had no idea how damn insightful that comic really was.


Larry Hama was ex-military, so he took the job seriously and elevated the story beyond your typical toy tie in. It was a totally different beast than the cartoon, which made it kind of jarring when I watched it and read the comic at the same time as a kid. For example, Snake Eyes, Storm Shadow, and Stalker were buddies who fought in Vietnam together and Snake Eyes had his face burnt off in the crash that ended Operation Eagle Claw. There was even an issue of GI Joe Special Missions that even used the Skyhook extraction device shown in The Dark Knight.

One of my favorites was the issue that was one extended dogfight between a Skystriker and Rattler, which featured real tactics and systems like look down/shoot down. One interesting detail was where Ace uses a Fuzz Buster because it does a better job at detecting enemy radar than the systems built in the jet, which I just recently learned was a real thing. The USAF MiG squadron apparently had them installed in their jets to improve their chances in training engagements during Red Flag because the Soviet detection systems were kind of crappy, according to a book about the Red Eagles that I just read.
 
2014-03-12 10:20:49 PM  

WillofJ2: I have lost a couple for what i thought were good friends over this, they surprise drop the pitch on you and then you point out that the profit model forms the shape of a pyramid and while it may not be a scheme per say it is.

They get so mad and honestly it takes a certain personality to want to sell things like this anyhow and I dont have it and they try to tell you that it will change once you see all the money coming in.

Like an odd vitamin pushing group of cults.


The harder one of those schemes push their "make big money" pep talk, the sleazier the scheme. And any mention of "wealth" or "prosperity", and well that's just a scam to completely avoid. But certain people fall for that -- people who want to believe.
 
2014-03-12 11:30:33 PM  

rugman11: It sounds like (according to the guy in the article anyway) that the main difference between Herbalife and other MLM companies is that the other companies actually sell stuff to people who are not involved with the company. According to him, the only people buying Herbalife products are the people selling it. They're buying the merchandise for themselves.


Lord Jubjub: The classic pyramid scheme is essentially the same as the chain letter asking you to send a dollar to the sender and passing the letter on to five other friends asking them to send you a dollar. This is illegal under gambling laws.

Amway and other such companies make the process rather voluntary and there are certain procedures in place that keep them inside the law. They are also private companies with no public stock. Herbalife went public in 2004.

/I could be wrong about this
//My last research into this area was a couple of decades ago.


Skirl Hutsenreiter: So long as you're supposed to be making money selling something to non-members it doesn't qualify. Where it falls apart is when there's a membership fee you pay up the chain that's bigger than the product sales, or when, like with Herbalife, no one is successfully selling to outsiders, just buying for themselves and recruiting new members.


Thank you guys!  I think I get the gist of it now. :)
 
2014-03-12 11:45:42 PM  
Limu 4 Life!!!!!!
 
2014-03-13 12:29:09 AM  

SecretAgentWoman: Um, I called this pyramid scheme out in the 90s. I figured it would have collapsed/been prosecuted by now. Geesh.


Thing is there is always a fresh supply of rubes coming out of high school who get caught up in the emotional sales pitch and big money nonsense that all these things run on.  Add that to their lack of savvy and willingness to trust makes them perfect bait.

I've known Quixar monkeys who've I watched piss away all their money.  Besides the terrible name, why would I want to buy toilet paper from a catalog when it's so damn easy and cheap to get it at Walmart?  Oh, I get a commission?  A commission on my overpriced sale to myself?  Yep, makes sense to me.  I'm an IBO!  That makes me smart because I know something and am willing to do something others don't have the vision for!  Barf.

If you added up the money a couple people waste on setup, materials, rallies, more materials, monthly fees, etc those people could've put a down payment on a McDonald's and made actual money rather than being bled dry by the upstreamers.  All the while told it's their fault because they aren't working hard enough to find enough other rubes to join the fold.
 
2014-03-13 01:06:15 AM  

rugman11: Longtime Lurker: ...and this is why I'm a fan of Major League Soccer.  Through the fact that Amway, Herbalife, Advocare, Xango, LifeVantage, and probably one more I'm forgetting have sponsored teams through the years, I'm well versed in which companies are MLMs and to stay the hell away from them

Could be worse.

[www.thevitalword.com image 850x634]


They renamed the Power Balance Pavilion, too.
 
2014-03-13 01:28:43 AM  

TheDirtyNacho: The worst date I ever went on started meeting a girl in the toothpaste aisle at the supermarket and ended being pitched a MLM scheme over coffee.


If it makes you feel better, you weren't on a date...
 
2014-03-13 03:38:47 AM  

Big Ramifications: Mad_Radhu: yukichigai: Mad_Radhu: Hell, I remember people giving my parents the pitch back in the mid-80s. Even though I was a kid, I knew they were bad news because in the 80s GI Joe comic, Larry Hama explained that COBRA got all of their funding for troops and weapons through Herbalife and Amway style pyramid schemes.

I would really, really like to see that comic if someone can find it.  I know GI Joe had some good info in their "Knowing is Half the Battle" segments, but if this is true I've gained even more respect for the comic/cartoon/line/etc.

It was scattered through the backstory, but it was first mentioned in issue #10 when Snake Eyes and Scarlett are captured by COBRA and interrogated at their secret base in a non-descript town called Springfield (funnily enough, when they escape at the end of the issue they aren't quite sure WHICH Springfield was the town they were in because it was so generic, which predates the Simpsons Springfield which is located at the four corners of Maine, Ohio, Nevada, and Kentucky). Issue 38 also dealt with it as well. This site has a pretty good run down.

Thanks for the clarification. I did a rudimentary search using cobra herbalife "gi joe" and grabbed the 1st relevant result.

From the #10 summary: Springfield was an ordinary town until the "soap people" arrived and began their pyramid scheme of selling cleaning products. Sales meetings soon became "indoctrination seminars" and soon the whole town was taken over. All of the buildings conceal Cobra hardware of some sort.

From the #84 summary: CC clarifies that while they'll sell vitamins and cleaning products...they're actually selling the IDEA of selling vitamin and cleaning products. "Vitamins" have now been added to Cobra's evil schemes. So stuff like HerbaLife and other door-to-door vitamin schemes of the 80's are now included. They're EVIL!

http://www.option38.com/comics/gijoe/10.asp


Thanks for the link! I've spent several hours going over the series in detail. Larry Hama made the series full of the kind of trivia about the military that a kid would be engrossed by. And his Cobra Commander had interesting goals and backstory.
 
2014-03-13 05:40:09 AM  

Mad_Radhu: One of my favorites was the issue that was one extended dogfight between a Skystriker and Rattler, which featured real tactics and systems like look down/shoot down. One interesting detail was where Ace uses a Fuzz Buster because it does a better job at detecting enemy radar than the systems built in the jet, which I just recently learned was a real thing.


No comic stores in the area, so I only ever had access to maybe three (inherited) issues of GI Joe, ever, but I think I did have that one.
 
2014-03-13 06:23:16 AM  
Wait till the FTC learns about Social Security.
 
2014-03-13 08:15:57 AM  

ClavellBCMI: Considering the guy leading the charge against Herbalife has a $1 *billion* short against their stock, and will profit *only* if Herbalife's stock takes a tumble, there's nothing fishy going on at all concerning this investigation. Now, is Herbalife a collection of money-grubbing low-life scumbags running a pyramid scheme? Quite possible. But it sure as shiat would have helped having faith in a fair and honest investigation if this investigation hadn't been pushed so hard by the one guy certain to make a literal fortune if the company goes under.


Next thing you will tell me is that hedge fund managers are manipulating the market.

Just buy gold it will only go up in value.
 
2014-03-13 09:59:00 AM  

TheDirtyNacho: The worst date I ever went on started meeting a girl in the toothpaste aisle at the supermarket


Have there ever been good dates that started in the toothpaste aisle? Like not just for you, but for *anyone*?

I mean the soda aisle sure. That way you can make sure she doesn't drink Pepsi. Or if she's hanging out in the condom/lube aisle, you know she probably puts out. The juice aisle would also be good, because if she's buying cranberry juice, she might have a UTI and you don't want to find that out the hard way. But the toothpaste aisle? No sir, nothing good ever comes from meeting someone in the toothpaste aisle.
 
2014-03-13 11:19:45 AM  
I had a friend whose trust-fund roommate tried to get her to join a "giving circle," or "empowerment circle," or some such thing. It was all couched in feminism and fighting the patriarchy. So, I tols her it was a pyramid scheme, and see was all like "no, see, it's a circle, I pay to join the circle and then i get to start my own circle, and the members pay me..."

So I drew it for her on a piece of paper.

Damned if those circles didn't stack up into a pyramid.
 
2014-03-13 01:36:38 PM  

MooseUpNorth: Mad_Radhu: One of my favorites was the issue that was one extended dogfight between a Skystriker and Rattler, which featured real tactics and systems like look down/shoot down. One interesting detail was where Ace uses a Fuzz Buster because it does a better job at detecting enemy radar than the systems built in the jet, which I just recently learned was a real thing.

No comic stores in the area, so I only ever had access to maybe three (inherited) issues of GI Joe, ever, but I think I did have that one.


If you have a tablet, they have collections of the old comics available to buy from Comixology. I grabbed the first three volumes for cheap a while back. I think it was something like $5 for each volume.
 
2014-03-13 03:25:28 PM  
Back in the early 90's, my former best friend took me to see this guy Charles something or other (he was really big in the early 90's) for some kind grow wealth scam. It was either stock trading or buying houses with no money down...

Anyways about a year after that he had befriended this dude who was into Amway. We went into a coffee place/diner and I sat through an Amway push. The dude actually said that you make your real money selling memberships to other people and not their own products... Which I think actually included Herbalife or something close to that name.

What a waste of time.
 
2014-03-13 05:17:57 PM  

Skeptastic: Newest thing I've seen being pushed on "friends" is Younique makeup. Sounds very much like a pyramid scheme to me. Anyone have any experience with them?


I belong to a FB group headed by KJ Bennett (an Emmy awarded makeup artist), and the poor guy had to ban hammer several women whose credentials were their status as Younique distributors.  The group is mostly made up of professional makeup artists and consumers who purchase theatre grade products.  The Younique women SPAMMED the hell out of that group, even dropping their pitches in unrelated threads.
 
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