MLM Scams

First, we recognize that all MLM companies are NOT scams. This post is only to warn you to do your due diligence, because some MLMS ARE scams.

MLM scams have been around nearly as long as MLM businesses have been around, and over the years hundreds of thousands, if not millions of people around the world have been victimized to some degree by an MLM scam. Of course when someone finally discovers he or she has been scammed, the first reaction is to want to try to get their hard earned money back.

Unfortunately, MLM scams are usually among the smartest of fraudulent businesses and have devised ways to make legal recourse for victims nearly impossible. There are a few main methods employed to avoid ever having to answer for financial damages caused to victims; the most common method is to make themselves impossible to contact.

Having false addresses and phone numbers, or numbers that never allow you to actually speak to a live person is an easy way to doge having to answer uncomfortable questions. It is also common for the headquarters of MLM scams to move frequently so when lawyers come knocking, there is nothing left but an empty warehouse.

A more sophisticated and foolproof method of dodging responsibility is by adding confusing and often hidden clauses in the company contract. Many MLM businesses, even legit ones, require new recruits to sign a contract compiled of vast amounts of information, and buried somewhere in there in miniscule writing is an agreement not to sue the company for financial losses.

They literally make taking people’s life savings with little or no chance of any return on the investment legal. So when a victim realizes that he or she has been pouring time and money into an MLM business venture and is getting nothing back, he or she has already signed a contract to do nothing about it.

It’s best to just not get involved in MLM businesses until you’ve checked with the Better Business Bureau to make sure it’s a legitimate company. If you do decide to invest in an MLM business, make sure you read every line of the contract carefully, with a lawyer if possible, to make sure you understand all the implications before you sign. And if down the road you do discover you’ve been scammed, good luck to you and your lawyer getting any of that money back.