China announces four-month crackdown on pyramid schemes
For all intents and purposes, Chinese regulation of MLM pyramid schemes is of the *winkwink, nudgenudge* variety.
The last major MLM pyramid scheme bust we covered was Nu Skin back in 2014.
After announcing it suspected Nu Skin was a pyramid scheme, a few months later a paltry $781,000 fine was doled out and that was the end of it.
The fraud was far more costly back home. A civil settlement pertaining to its Chinese pyramid scheme activities saw Nu Skin cough up $47 million dollars.
In what might be a sign of changes to MLM regulation going forward, earlier this week the Chinese government announced a crackdown on pyramid schemes.
In a statement published on August 12th, the Chinese government expressed concern at the current state of the local MLM industry.
Recently, MLM activity is rampant (as well as) the use of various channels and means to lure the people into pyramid schemes.
(This has caused) serious damage to the people’s lives and property, (leading to) widespread concern in the community.
The announced crackdown will see Chinese authorities attempt to clean up the industry over three stages beginning August 15th.
August 15th to 31st – Compile a list of suspected pyramid schemes to investigate.
September 1st to October 31st – Conduct thorough investigations on companies and individuals who participate in suspected pyramid schemes.
“Severely punish” those found to be promoting pyramid schemes and “destroy” MLM companies conducting pyramid fraud and false advertising.
November 1st to 15th – Tie up loose ends and establish protocols and guidelines with a long-term goal of better regulating MLM pyramid fraud.
Whether anything comes from the crackdown remains to be seen, but back in the US shares in Herbalife, Nu Skin and Usana tanked after the announcement was made.
Typically I try not to read too much into MLM company stock market activity. But it’s a bit hard to ignore slumps across some of the biggest US MLM companies, immediately after China announces it’s going after pyramid schemes.
*Winkwink, nudgenudge* indeed.
In China, the specific term is chuang xiao 传销.
which has a legal definition: 只要是組織一人群構成一金字塔型層級結構，其中有任何一人以上的收入計算基礎在於發展下線及下線衍生之下線的人數多寡.
mutliple individuals into a pyramid-shaped multi-level structure, and any one or more person’s income is based on recruiting more downlines and more downline’s downlines.
What’s more, those who heavily recruit can be indicted alongside the organizers as “active participant” 積極參與份子.
It’s also worth noting that this specific “operation” is designed to go after the ”false recruiting / hiring ads” that targeted new graduates, and may be a reactionary measure against several deaths reported recently after some graduates got lured into these brainwashing camps and died either during or after the camps.
WILL ONE COIN SUPPORT SUICIDE PREVENTION GLOBALLY
You will have seen the recent post regarding the Chain Clampdown so I have just sent the following mail to Dr Ruja Igntova, Irina Dilkinska and you might send similar to the others involved if you have their emails
Don’t bother sending me a cheque for the idea give it to a worthwhile charity involved in suicide prevention-maybe Kasey agrees????
The price increases when the difficulty increases and conveniently the “difficulty increase barometer” is at 94% so… 😀
w00t!
i don’t want a cheque but I am I am asking Ruja to paty the charity -sorry for any misunderstanding but I was ranting in full flow against OneCoin.
@Otto –yes I think we both feel a new “value” for the coin will magically appear -in time certainly for the gal dinner etc in Portugal at the beginning of October??
Seems a bit desperate… Haven’t had time, but this came yesterday.
Great job cryptokill, Otto and all others.
mailchi.mp/dd1f8254b334/jxkey6m9c9-701013?e=a0e0b3336a
@moi
Onecoin –What a shambles–WILL WAHLROSS BE THE LAST MAN STANDING (or as he says you can either be an eagle or a chicken?).
This is now all about desperation and splits are for when the sales are slowing -not reflecting exceptional demand or mining difficulty. But in unique OneCoin fashion let us assume that the coin goes up from about 13 Euros to 15 Euros(say 15%)and with these super splits etc 125 becomes 500 which then becomes 575 in “value”.
You just have to ask yourself the question WHY –the answer is you cant actually lose out on OneCoin -BECAUSE THEY DON’T EXIST!!!!! ..
That is after all what Ruja and Arens said in their Q&A session about a month ago which has now morphed into we are not an MLM business we are an educational supplier -without an education Officer (remember Ludbrooke who again told us that the coin is valueless) ..
But there is always the gold backed Aurum Coin -what was that all about???
Go and look after your alleged daughter Ruja.
The only way the Affiliates will make any money out of this is by legal action and freezing as many shell Company accounts as possible to hand over to a receiver.
CLOSE THIS DOWN AS SOON AS POSSIBLE AND PREVENT THE SUICIDES!
And Wahlross can either be an eagle or a scavenging vulture.
Regards,
Anyone knows what has happened to Peter Shaw who set up the Pioneers in UK?
So everything on your site about Nu Skin (that I can find) is about Nu Skin in China– but it is making aggressive leaps and strides here in the States…
Despite getting burned by Quixtar (the offshoot of Amway in the early 2000s) and watching the implosion of Nerium, my parents still got sucked into Nu Skin and I have GOT to find some dirt to shake their blind faith. Whatcha got?
I haven’t reviewed NuSkin yet so I can’t comment on their business model.
If they got caught running a pyramid scheme in China though, they’re probably not doing much different in the US.
I think it’s important to understand that multi-level marketing is a business model and requires people to “do” an action. It is not the name of a company. Any company that requires their minions to use the flawed method is going to have the same result.
This link mentions both Amway and Nuskin and is a wealth of information on MLMing in general.
ftc.gov/sites/default/files/documents/public_comments/trade-regulation-rule-disclosure-requirements-and-prohibitions-concerning-business-opportunities-ftc.r511993-00017%C2%A0/00017-57317.pdf