I Think My Friend is Pushing a Pyramid Scheme

Dear Robin:

I have a very good friend, I’ll call her Sally.  She has been a stay-at-home mom for several years and now that her kids are in school, she wants to get back to work and earn some money. She used to be a physician’s assistant but doesn’t want to go back to that type of work so she has decided to try something totally new.  That’s great, but unfortunately she has chosen a “career” that makes me worry about her.

She is involved with a company called Nerium and they sell skin care products. She gave me some to try and I didn’t notice any change in my skin, good or bad. When I told her I wasn’t interested in buying anything, she didn’t seem to mind at all, and said that what she really wanted was for me to sign up to be a distributor.

I told her I wasn’t interested in that either, and she got pretty upset with me. She said if I couldn’t be supportive of her maybe we weren’t as close as she thought we were.  Now we haven’t spoken in a couple weeks and that is very unusual for us as we usuallly talk every other day or so. I’ve heard from some mutual friends and they report the same thing.

How do I fix my friendship without getting sucked into her business? Also, should I tell her I think it might be a scam?

“Carole”

Dear Carole:

I’ve seen a lot of this lately.  Let’s talk about your friendship with Sally first, and then the business venture she has begun.

pyramid

I don’t know Sally, so I’m about to give you some really shady long distance armchair analysis based upon me and my feelings.  In case any of you out there have forgotten, this blog is really all about me – I just pretend to care about the problems of others so I have a vehicle for my (unpaid for) musings.

Sally is going back to work (yay, Sally!) but is taking the giant leap of doing something new.  Giving up doing what you know and jumping into something outside your comfort zone is really exciting, but it’s also really scary.  Sally likely thought she could count on her friends to support her in this business and she probably didn’t put a lot of thought into what that meant.  Specifically, in order for Sally’s friends to support her, they need to either purchase products from her or sign up to distribute those products.

friends

That’s asking an awful lot of a friend, especially if (as in your case) those products aren’t effective.

Back to me, because duh.  I know how she feels.  Having recently lost my mind and starting this advice blog, I have been deeply moved by the support of many friends, family and strangers.  I have also been deeply disappointed that many people I thought would be on Team AskDesCamp have chosen to remain on the sidelines.  It hurts.  Like, a lot.  Sally is probably really hurt by what she sees as a lack of support amongst her friends.

For me personally, just the fact that some friends I have known for years haven’t even liked one blog post on Facebook, let alone share or comment on them, makes me really sad and brings up all sorts of feelings of insecurity and the knowledge I am not now, nor will I ever be, one of the “in” crowd.  I guess that makes me an outie, which is cool in some respects.  I’m so uncool I’m cool.

uncool

So yes, feeling unsupported by friends can bring up painful feelings.  Then again, I’m not asking anyone to buy anything except my bullshit, which happens to be free. Sally is pushing the boundaries of friendship by taking the position that if you don’t purchase products from her or join this organization, you aren’t being supportive.  You say she has done the same with other friends, so I think Sally is really in need of a sit-down.

If she is burning valuable bridges left and right over this deal, that tells you Sally is in a bad place right now.  Maybe her financial situation is dire and she feels enormous pressure to make money.  I know from my handy-dandy google machine that she spent a good deal of cash to purchase product up front, and likely has unrealistic expectations about the financial gains she can make selling this scam because of the full-throttle marketing machine that is Nerium.  They really should rename the product “Delirium,” because they whip people into a frenzy with promises they can get rich fast and work at home.

cult

By the way, this product is crap.  I did some research; more on that in a moment.

My advice regarding your friendship with Sally is put yourself in her stilettos for a moment and try to understand what’s happening with her.  Get her on the phone, take her lunch (replete with Chardonnay, of course) and ask her what’s going on.  Tell her you love her but you did some research via www.AskDesCamp.com and you are worried that she may have made a bad investment and should probably look into it.  Give her a link to this blog, because if you can’t support her, at least you could support me.  And thanks!

support

So here’s the deal: Nerium, and a shitload of other multi-level marketing companies like it including Scentura, Primerica and Vemma, is a scam.  It’s a classic pyramid scheme in which poor fools like Sally invest money that they usually can’t afford and are stuck with a product they can’t sell.  The only way they can get their money back is to recruit distributors of this worthless goo, and so on and so on and so on.

poop

Nerium makes claims that simply aren’t true, and refuses to provide scientific data to back up those claims.  In addition, the company trumpeted that it was endorsed by the prestigious MD Anderson Cancer Center in Texas.  That was bullshit, and the cancer center finally had to post a disclaimer on their website, which you can read here: http://www2.mdanderson.org/cancerwise/2012/08/setting-the-record-straight-about-md-anderson-and-nerium.html

Nerium, like most other MLM scams, requires a large investment not only in “product” and on-going fulfillment requirements and fees, but also rakes in the cash by luring hungry desperate people to their sales seminars, which can cost thousands in fees and travel.  It operates with a very culty mentality that reminds me a lot of Scientology.

mlm

Because I am feeling lazy today and don’t care to break it all down for you, here is a link to a very good article on how to spot an MLM pyramid scheme: http://www.consumerfraudreporting.org/MLM.php

If you want to be a good friend to Sally, tell her to stop throwing good money after bad and walking away from friendships over skin care product that is worthless and actually contains poison (oleander).  Remind her that the two of you have been close for a long time, and any “job” that would come between you if you don’t participate financially is not legitimate.

Basically, slap some sense into this silly woman and offer support by having a conversation about what she can do to earn money.  There are many ways you can be supportive if she needs to find work: offer to help with her resume (unless you suck at that, in which case I totally suggest you send it to my mom because she rocks), take care of her kids when she’s interviewing, or maybe just take her shopping for a new interview outfit.

mmmmmmmm…shopping…here’s some boot porn:

boot

If Sally continues to shun you over this, you’ve lost her to the MLM cult.  Don’t worry, she’ll be back once she loses enough money.  At that point, you can decide whether to continue the friendship.  Best of luck and let me know how she reacts.  And don’t put that shit on your face: it doesn’t work and it may actually hurt you.

-Robin

This Post Has 17 Comments

  1. John DesCamp

    I’ve never understood why people don’t look at the math on these pyramid schemes. Think about it: If each person is supposed to recruit 10 distributors, and those 10 distributors are supposed to each recruit 10 distributors, and so on for only 6 levels, you would have
    1 million people flogging questionable cosmetics in the good old US of A.

    One million! Oregon has approximately 1% of the US population, so that would mean that Ten Thousand desperate housewives are combing the State of Oregon for “distributors”. Metropolitan Portland has about 70% of the state’s population, so now we have about 7,000 denerious (that was intentional) skin care queens searching high and low for the next generation. There would be traffic jams in remote suburbs at 10:00 in the morning and MAX would have to put on additional trains.

    And if, by chance, all 7,000 found the requisite number of suckers, we’ve now got 70,000 of them. HELP!

    1. askdescamp

      Great points, all. Oy! The math!

      1. echinachea

        Math is a good thing.

  2. Leslee Lukosh

    I love your blog and I am a stranger to you! Great answer!

  3. Melinda

    Each and every single time I have calculated the Schedule C income of a person involved in one of these schemes, they have shown a significant loss…I truly have never seen even one person with a profit. What people fail to realize is that writing this loss off means that their ability to get credit is now jeopardized for the following two years since the loss is averaged. I’m stupified that any business that requires you to obtain other “distributors” is allowed to open in the first place. I’ve seen more than one friend lose their “investment” to bullshit like Scentsy. Time to wake up…if it seems too good to be true, than it is!

  4. Ali Whiting

    My kid bought into a scam like this. Of course he was 19 and apparently you still know everything at 19 (rolling my eyes). I think you gave great advice. GF was looking for a safe job in a safe zone surrounded by her BFFs. The only support she should be looking for from friends is emotional, not financial!! You nailed it…

  5. CL

    You were always one of the “in” crowd, so I don’t know what you’re talking about. I think high school really messed us up. BTW, I do believe you’ve posted that “boot porn” pic before. It’s a great one- but I would like to see more. No duplicates, please. *emoticon

  6. The Blogging Rapper

    Eh… really it depends on what you’re representing.

    Before I say anything else, PLEASE take a sec to watch this: http://youtu.be/tkNfIhP7M4w

    First of all, I never EVER go to friends and family. That’s just pointless. Second, I know the general consensus about home businesses, but if you ask the right people, they’ll tell you they were able to completely replace their income at work to work from home.

    There are many that do require some start up capital. Duh, that’s because they’re not your typical “9-5 punch a clock jobs”… They’re business models you can personally run. There is overhead to get it going.

    As for the “math”, I refer you to the video again. Listen to what Mr. Robbins says.

    I hope this has helped 🙂 I run a home business and train others and I love it!

    1. askdescamp

      Thank you for your comment. I did not intend to convey the message that one cannot make money working from home – I know many who do (unfortunately, not me). My blog was about the predatory MLMs and we all know they are out there. The Federal Trade Commission is all over this stuff but unfortunately, every time they shut one down, another one pops up with the same players. See: Herbalife/Vemma.

      1. The Blogging Rapper

        Oh I agree. I don’t have any experience with Herbalife and Vemma so I can’t say I have any thoughts on them. I’ve only heard them by name. 🙂

  7. Linda

    I was on Google reading about it before I knew you had posted links. I have had so many friends involved in MLM scemes. I am fortunate that when I declined, they were still my friends. The classic one is Amway. I hope that Sally comes to her senses before she loses more money and all of her friends! Good advice Robin!

  8. Debbie

    These reminds me of the very awkward time when I, yes I was talked into Amway by a trusted friend. At that time, the “new and improved” Amway was newly online and disguised as the name “Quixtar”. When I placed my own order, I wound up spending $300 for household items that normally cost a third of that price. I remember going to the “cheerleader” meetings where people who supposedly had great success, wealth and wonderful lives cheered on us fledgling newbies to go for it and nothing else in life mattered except talking to people about Quixtar, building relationships, and building up your team. It is an embarrasing chapter in my life.

  9. echinachea

    A neighbor spent a great deal of effort tring to get my spouse to be a distributor of some super pricey, horrid tasting “health chocolates.” These days, all it takes is a couple Googles to learn all one needs to learn about these “opportunities.” BTW, I am aware of my inclination toward Quotation Marks Abuse, but I never abuse apostrophes. The mentality of these organizations is indeed cultlike, and often downright silly. Lots of mind control, and this “we’re not really friends of you don’t want to be a distributor….” is pure crappola. Excellent letter, response and other replies.

    1. CL

      Why is ‘Quotation Marks Abuse’ capitalized?

      1. CL

        @Blogging Rapper- your venture is Visalus, right? What’s that all about? I had been hearing a lot about that for a while…

      2. echinachea

        Just because I felt like it:)

  10. Over it!

    Oh my goodness. I so relate to this post!!! I have a (I thought, good!) friend who has recently gotten sucked in, a$$ over teakettle, to Nerium. It’s like she’s suffering an out of body experience – she talks of almost nothing else, I never see her and if I hear from her, 1/2 the time it’s about Nerium crap. I’m SO OVER IT!! The product is POISON. I’ve read enough and seen enough to know their business model is also poisonous. My husband (who’s an attorney and accountant) and I (also an attorney) suspect the entire sham will be shut down soon by the regulators – but meanwhile my friend is just completely lost to me. She hasn’t gone so far (thank God) as to suggest that I’m a terrible friend because I’m not buying (or selling!) this crap product, but I rarely hear from her because I’m not part of the “Nerium Crew.” She just got her “iPad bonus.” (rolls eyes) She’s even gone so far as to ask me if MY family wants to buy this crap!! HELP!! Oy.

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