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Today I read a reporters story about an alleged pyramid scam in China…

I have shared a few paragraphs of this report, and I think it is this type of ignorant reporting, or at least incomplete reporting that gives mlm, network marketing such a bad rap in the public view, please share your opinions…

Full report here
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$10m lost as victims fall to pyramid scam

New immigrants, fresh graduates and jobseekers have lost more than HK$10 million in a pyramid- selling scam.

Diana Lee
Monday, May 19, 2008

New immigrants, fresh graduates and jobseekers have lost more than HK$10 million in a pyramid- selling scam.All said they were duped into buying hundreds of thousands of dollars worth of aroma products.

Cheung, in her 40s, said she was persuaded in 2005 by a neighbor to buy HK$500,000 worth of essential oils of a certain brand after being promised amazing returns.

She said she attended day-long meetings at a company office, during which she was subjected to a variety of underhand sales techniques.

“They told me I must not tell my relatives about the business, otherwise they will stop me. I followed the advice and secretly used the savings held jointly with my husband.”

Another woman, surnamed Tsang, invested HK$1 million by mortgaging her property.

“My husband was a public security officer and told me it was a scam. I refused to believe him. I said they held grand conferences at the Hong Kong Convention and Exhibition Centre and that the company hired a lawyer to explain its business was legal and profitable.”

Pang from Shenzhen borrowed HK$67,000 from relatives using different excuses, but the money was for seven bottles of essential oils and a membership fee.

The victims later went to police headquarters to meet officers from the Commercial Crime Bureau.

The company involved in the alleged pyramid selling scam could not be reached for comment.

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By no means am I defending how this company, who ever they are acted in their corporate headquarters, and by no means am I defending the distributors that have strongly mislead their prospects into front loading products for sake of immediate payout to their uplines.

I do however see many problem with this:

1. The words pyramid scam are thrown out way too often, and often irresponsibly so, if used need to be justified, so that uneducated people can learn the difference.

2. Other countries company leaders need to be educated so they don’t prospect like many people did here in the US 20-30 years ago.

3. The general public needs education so they don’t make moronic decisions like the poor folks that bought all this product!

4. Reporters need to be educated so that THEY can report about the specific issue and name the specific companies, reports like this make even legitimate companies and people involved in them look bad.

What do you think?

Anders