Sunday, March 14, 2010

TVI Express: fits FBI's definition of pyramid scheme

Here's FBI's definition of pyramid scheme:

Pyramid Scheme
Pyramid schemes, also referred to as franchise fraud, or chain referral schemes, are marketing and investment frauds in which an individual is offered a distributorship or franchise to market a particular product. The real profit is earned, not by the sale of the product, but by the sale of new distributorships. Emphasis on selling franchises rather than the product eventually leads to a point where the supply of potential investors is exhausted and the pyramid collapses. At the heart of each pyramid scheme there is typically a representation that new participants can recoup their original investments by inducing two or more prospects to make the same investment. Promoters fail to tell prospective participants that this is mathematically impossible for everyone to do, since some participants drop out, while others recoup their original investments and then drop out.

Some Tips to Avoid Pyramid Schemes:
  • Be wary of "opportunities" to invest your money in franchises or investments that require you to bring in subsequent investors to increase your profit or recoup your initial investment.

  • Independently verify the legitimacy of any franchise or investment before you invest.
( cited from http://www.fbi.gov/majcases/fraud/fraudschemes.htm )

 Let's see...

distributorship -- TVI Express call all recruits "distributors". Says so on the front page of their website!

"The real profit is earned, not by the sale of the product, but by the sale of new distributorships." -- yep, the $10000 (or $15000 or whatever) payout is obtained by "cycling the matrix", which means "get a lot of downlines". Besides, the company's own FAQ says "you don't need to sell anything." If there's no sales of product, then it must be sale of new distributorships, i.e. recruiting!

"At the heart of each pyramid scheme there is typically a representation that new participants can recoup their original investments by inducing two or more prospects to make the same investment." -- yep! Bullseye... You recoup your investment by cycling out the first matrix/board, which you start by recruiting two downlines, and teach EACH of them to recruit two more... (that's from the TVI Express FAQ)

So far, we've pointed out that TVI Express fits every definition of a pyramid scheme we've thrown at it. The FBI's definition above, the FTC's definition we used before, and others. Of the 600000 members out there in TVI world, NONE had came and offered any explanation WHY TVI Express is NOT a pyramid scheme. Does that mean they are ignorant, or they just don't care that they are participating in a crime?
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