Chartfords Review: Fine art & MLM?
There is no information on the Chartfords website indicating who owns or runs the business.
An address in Canada is provided on the Chartfords website, however a Google search reveals mulitple businesses operating out of this address meaning it’s most likely just virtual office space (mailing address).
The domain registration for the Chartfords website (“chartfords.com”) only adds confusion to the mix, providing another address in Kent, UK under the registrant “Midas Marketing Group”.
Midas Marketing Group have their own website over at “midasgrp.co.uk” which is currently promoting the Chartfords MLM opportunity:
The Midas Marketing Group website domain registration lists a “Barrie Sapsford” as the owner, operating out of Essex in the UK.
On his Facebook profile Barrie Sapsford credits himself as the Director of Midas Marketing Group since early 2000:
I wasn’t able to dig up any further MLM history on Sapsford, possibly indicating that Chartfords is his first MLM venture.
Read on for a full review of the Chartfords MLM business opportunity.
The Chartfords Product Line
Chartfords has no retailable products or services. Instead, members join the company (by referral only) and purchase art via a company hosted storefront.
Members earn commissions when members they’ve recruited purchase art from the the Chartfords storefront.
Chartfords themselves do not create the art available for sale on the website, which is instead sourced from third-party artists. Chartfords provide information on each of the artists with work for sale on their website.
Prices for the artwork featured on Chartfords starts at $200 CAD.
The Chartfords Compensation Plan
The Chartfords compensation plan revolves around points, with every $200 CAD spent with the company generating 1 point.
Points are essentially positions in a company wide 2xinfinity matrix. This matrix starts off with one position at the top with two legs branching out from under it. In turn these two legs branch out into two legs and so on and so forth:
Note that despite being in a company wide binary, each position within the binary itself acts as a mini 2×4 matrix (note the fourth 16 position level is absent from the diagram below):
Once the positions below the starting position in this matrix is full, the position at the top pays out a commission.
If three levels of the mini-matrix are full (2×3 matrix), the position pays out $250 CAD.
If all four levels of the position are full (the entire 2×4 matrix), the position pays out $1000 CAD.
The total payout per position is $1250 CAD and another position in the company wide binary (which also creates a new mini 2×4 matrix).
The company wide binary comes into play when a Chartfords member purchases multiple positions.
Odd numbered positions are placed in the oldest spots remaining to be filled in a member’s upline’s incomplete matrices. Even numbered positions are simply placed in the oldest unfilled positions company wide (the oldest unfilled positiion in the binary.
In effect, new members help their upline’s fill up their matrices with their odd numbered positions, with their even numbered positions acting as spillover for the company.
Referral commissions are also paid on the purchase of new positions, paid out using a unilevel compensation structure.
A unilevel compensation structure places a member at the top of the structure, with every personally recruited new member placed directly under them (level 1).
If any of these level 1 members recruit new members of their own, they are then placed on level 2 of the original member. If any level 2 members recruit new members, they are placed on level 3 and so on and so forth.
Using this unilevel compensation structure, Chartfords pay out referral commissions down ten levels, with commissions being paid out upon the succesful completetion of a 2×4 matrix.
How much of a commission is paid out depends on what level the member who owns the completed position sits on in the unilevel compensation structure:
- Level 1 – $200
- Level 2 – $100
- Level 3 – $50
- Levels 4 to 6 – $20
- Levels 7 and 8 – $10
- Levels 9 and 10 – $5
New Chartfords members can only sign up via a referral link from an existing member, with the company charging a $250 membership fee following a member’s first matrix cycle.
Chartfords do not set a timetable for this to occur so there appears to be some ambiguity as to when members are charged.
A simplified breakdown of the Chartfords compensation would be that members join the company, invest money and earn a 625% ROI once 30 new $200 CAD investments have been made after their own.
The obvious counter to this is that Chartfords members are purchasing art, with any commissions paid out being incidental. As per the breakdown of money members pay to the company however upon “purchase” of artwork, this is not the case.
Chartfords claim that for every $1250 payout, it is only the fourth layer of the 2×4 matrix (16 positions) that counts towards commission payouts. The positions in levels 1 to 3 are used to pay commissions on positions above (counted as being the fourth level of a mini 2×4 matrix higher up in the company wide binary).
At $200 CAD a pop, this equates to the fourth level of every mini 2×4 matrix generating $3200.
Out of this $3200, just $640 is paid to the artist for the artwork (20%), with the remaining $2560 (80%) used to pay other members who have prior bought positions.
Chartfords take their $420 (7.6%) cut out of each remaining $2560 balance.
If we consider that each position bought winds up being the fourth layer of a mini-matrix within the company wide binary, this equates to 80% of the revenue generated by Chartfords being paid out as a ROI to members who deposited money with the company previously.
Where is this revenue sourced? New deposits made by new and existing members.
With art purchases accounting for just 20% of the total revenue members pump into the company, each $200 CAD deposit generating an effective 625% ROI once a theoretical minimum of 32 new deposits have been made and no retailable products or services able to be sold by members, Chartfords effectively operates as a member-funded Ponzi scheme.
Whereas a traditional Ponzi scheme pays out ROIs based on a fixed number of new investments or a variable ROI rate (based on the rate of investment and re-investment by members), Chartfords on the other hand effectively increase the rate at which ROIs are paid out, due to the company-wide binary increasing in width which each new level generated.
Overtime the binary will balloon out and with half of each member’s new investments being designated to the oldest unfilled position, this will result in longer and longer blowout times for members to fill new 2×4 matrices and earn their ROI.
Adding to this is also the problematic creation of “free” positions each time an existing positions cycles. These positions bring no new revenue into the scheme, yet still extract an eventual $1250 CAD payment.
Nevermind the fact that if new and existing members stop
buying artwork investing in binary/matrix positions, the entire scheme collapses.
Props to Chartfords for a bit of creativity with the whole “fine artwork” angle, but the reality is their business model and compensation plan is no different to any other Ponzi scheme out there.
When you have members funding existing member’s ROI payouts, paid out upon a fixed number of new investments being made, ultimately what the company pairs this model with becomes irrelevant.