“Like all other pyramids, once they run out of new recruits to bring into the club, the money dries up, leaving everyone waiting for their pay out holding the bag.”
US Federal Trade Commission
(CMR) The latest pyramid Ponzi scheme, The Commitment Circle or SouSou, has hit the Cayman Islands with a feverishness unseen in years. By week three participants are promised a $6,000 payouts with hopes of a much bigger prize ahead.
There was a big meeting at the airport park last week that saw people come out in droves. It turns out a scam by any other name is still a scam.
In Trinidad and Tobago over 1,200 people ignored warnings from officials and lost their hard-earned money, it was revealed earlier this month.
High-level government officials and many others in the community recruiting newcomers with promises of a high payout in return.
However, there are numerous concerns that this is just another of a soon to be failed Ponzi scheme like many before it.
Claiming to be a “life-changing experience and an opportunity to work as a community to reach personal and professional goals” it promises a huge return in only 21-days. There is even a WhatsApp group created for it called Blossom Team 28.
The committee WhatsApp message in circulation claims that it will have a huge payout of $63,000 if you are willing to “grind for 21 days to the reap the blessing of $63k”.
The grind like all MLM means that you must recruit others because in fact, the only way for it to be successful is for the continual recruitment of new people who will be paying in their $400 that allow for the large payout to continue.
Part 2 of the instructions give it way when it states that “you have to have two-like minded individuals that are willing to commit with you.” It goes on to say that you must ensure that they are “understand the commitment required.”
The marketing pitch is very nonsensical is so many regards as point 3 shares “in the event that your core team is unable to fulfill their individual obligations, you have to be willing to assist in helping identify the missing fires.”
Appealing to people's skepticism it then says that you have to help them “understand the blessings outweigh the risk”.
Then in a complicated way, it explains how the weekly payouts will work. Ironically, they are done on Sundays, the holiest of days in the Cayman Islands when gambling is supposed to be frowned upon:
There many cautionary tales that MLMs simply do not work. Many in Cayman were part of the Talk Fusion, iMarkets Live, cryptocurrency and even a travel agency one that was popular back in 2016. There have also been numerous peddling vitamins and various other products.
Famous brands like Amway, Avon, Mary Kay and Herbalife have used the multi-level marketing (MLM) method – very similar to a pyramid scheme to make millions across the world. Some now defunct and investigated by the likes of the SEC have caused many to lose their hard-earned money.
But nothing seems to stop the hopefully from grabbing at the promise of quick cash in a flash.
Since COVID-19 the desperate has led to this exact same scheme taking on many forms around the Caribbean. In St. Lucia it was called Blessing Loom and promoted largely via social media platforms.
Officials in Dominica, Trinidad and BVI also issued warnings lately about these pyramid style schemes.
Difference Between Pyramid Scheme and Multi-Level Marketing Company
Multi-level marketing companies (MLMs) are legitimate businesses with the goal of moving products to consumers. If new buyers aren’t already members of the MLM company, you can sign them up and earn a percentage of the income they generate.
On the other hand, in a pyramid scheme, the income usually comes from recruiting new members who must pay an entrance fee or startup cost, which is used to recruit new members.
At MLMs, there are benefits to recruiting new members, such as earning a commission of their sales. However, the main goal of the organization is still to move product.
Some have suggested that all MLMs are pyramid schemes because of the structure and because most distributors end up buying the product rather than consumers. But the FTC has ruled that MLMs are legal business structures.
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