Elysium Network Review: Elysium Capital securities fraud
Elysium Network operates in the “money management” MLM niche.
The company provides three corporate addresses, in Hong Kong, Estonia and Sweden.
Heading up Elysium Network is founder, CEO and Chief Legal Officer Fred Pascal Stege.
As per Stege’s Elysium Network’s corporate bio;
Fred is an experienced C-level executive with a law enforcement background.
An entrepreneur and tech investor with a demonstrated history of working in management consulting roles in the aﬃliate marketing industry, he has a proven track record of success in Operations, Finance, Financial Markets, Trading, Marketing, Management and Sales in multi-billion US$ ventures.
According to Stege’s Facebook profile, he’s based out of Malmo, Sweden. Thus it appears Elysium Network exists in Hong Kong and Estonia in name only.
The earliest record of Stege’s involvement in the MLM industry I was able to find dates back to 2005. Stege was a co-owner of Vemma’s European, African and Israeli markets.
In 2010 Stege left Vemma. A year later he founded Origin Pure, a nutrition based MLM company.
BehindMLM came across Stege in our April 2014 review of Origin Unite.
On the executive side of things, Fred P. Stege appears to have been primarily involved in MLM lead generation and marketing.
By 2016 Origin Pure and Origin Unite had collapsed, prompting Stege to sign on as General Manager for Northern Europe at Jeunesse.
According to Stege’s LinkedIn profile, he held the position until May 2019.
Elysium Network was founded a few months ago (website domain reg last updated March 2020). Other components of the company appear to have been put in place starting mid to late last year.
Read on for a full review of Elysium Network’s MLM opportunity.
Elysium Network’s Products
Elysium Network offers an investment scheme through the Elysium Capital Pinnacle Portfolio.
This world-class-performing portfolio is the genesis strategy and birthright of Elysium Capital with a continued objective and strategy which, for a decade, has achieved high performance with a proven solid risk-to-reward ratio.
Elysium Network claims to generate return revenue via
currency trading, manual & via EA. Complex mathematical and statistical modelling. High Frequency Trading (HFT).
Investments of €500 EUR or more are solicited. No specific information on returns is provided.
Elysium Network’s Compensation Plan
Elysium Network’s compensation plan primarily revolves around paying affiliate fees, and then getting paid to recruit others who do the same.
Investment commissions are paid only on generated returns, through a unilevel compensation structure.
Elysium Capital Affiliate Ranks
There are thirteen affiliate ranks within Elysium Capital’s compensation plan.
Along with their respective qualification criteria, they are as follows:
- IB – sign up as an Elysium Capital affiliate
- 1-Star IB – refer one client and recruit three affiliates
- 2-Star IB – refer two clients and recruit six affiliates
- 3-Star IB – refer three clients and recruit nine affiliates
- 4-Star IB – refer six clients and recruit twelve affiliates
- 5-Star IB – maintain six referred clients and twelve recruited affiliates (six must be 1-Star IB or higher), and be earning 25+ binary cycles each month
- 6-Star IB – maintain six referred clients and twelve recruited affiliates (six must be 1-Star IB or higher), and be earning 50+ binary cycles each month
- 7-Star IB – maintain six referred clients and twelve recruited affiliates (six must be 1-Star IB or higher), and be earning 100+ binary cycles each month
- 8-Star IB – maintain six referred clients and twelve recruited affiliates (six must be 1-Star IB or higher, two recruitment legs must have a 5-Star IB in them), and be earning 200+ binary cycles each month
- 9-Star IB – maintain six referred clients and twelve recruited affiliates (six must be 1-Star IB or higher, four recruitment legs must have a 5-Star IB in them), and be earning 400+ binary cycles each month
- Diamond IB Presidents Team – maintain six referred clients and twelve recruited affiliates (six must be 1-Star IB or higher, six recruitment legs must have a 5-Star IB in them), and be earning 800+ binary cycles each month
- Diamond IB Chairmans Team – maintain six referred clients and twelve recruited affiliates (six must be 1-Star IB or higher, eight recruitment legs must have a 5-Star IB in them), and be earning 1200+ binary cycles each month
Note that clients refer to customers who have invested. These can either be retail clients or recruited affiliates.
For more information on binary cycles refer to “Residual Recruitment Commissions (binary)” below.
Direct Recruitment Commissions
Elysium Capital affiliates are paid to recruit new affiliates.
- earn €25 EUR on the recruitment of a €179.90 EUR affiliate
- earn €100 EUR on the recruitment of a €548.95 EUR affiliate
Residual Recruitment Commissions (unilevel)
A unilevel compensation structure places an affiliate at the top of a unilevel team, with every personally recruited affiliate placed directly under them (level 1):
If any level 1 affiliates recruit new affiliates, they are placed on level 2 of the original affiliate’s unilevel team.
If any level 2 affiliates recruit new affiliates, they are placed on level 3 and so on and so forth down a theoretical infinite number of levels.
Elysium Network caps payable recruitment commissions at seven unilevel team levels.
A €25 EUR residual recruitment commission is paid on the recruitment of €548.95 EUR affiliates.
- IB ranked affiliates earn residual recruitment commissions on two unilevel team levels
- 1 Star IB ranked affiliates earn residual recruitment commissions on three unilevel team levels
- 2 Star IB ranked affiliates earn residual recruitment commissions on four unilevel team levels
- 3 Star IB ranked affiliates earn residual recruitment commissions on five unilevel team levels
- 4 Star IB ranked affiliates earn residual recruitment commissions on six unilevel team levels
- 5 Star IB and higher ranked affiliates earn residual recruitment commissions on seven unilevel team levels
Residual Recruitment Commissions (binary)
A binary compensation structure places an affiliate at the top of a binary team, split into two sides (left and right):
The first level of the binary team houses two positions. The second level of the binary team is generated by splitting these first two positions into another two positions each (4 positions).
Subsequent levels of the binary team are generated as required, with each new level housing twice as many positions as the previous level.
Positions in the binary team are filled via direct and indirect recruitment of affiliates. Note there is no limit to how deep a binary team can grow.
Sales volume is generated across the binary team as affiliates are recruited into it, and when they pay their monthly affiliate fee.
200 GV matched on both sides of the binary team generates a €20 EUR cycle commission.
Elysium Network caps cycle commission earnings based on rank:
- IBs can earn 3 cycles a week
- 1-Star IBs can earn 5 cycles a week
- 2-Star IBs can earn 10 cycles a week
- 3-Star IBs can earn 15 cycles a week
- 4-Star IBs can earn 25 cycles a week
- 5-Star IBs can earn 50 cycles a week
- 6-Star IBs can earn 75 cycles a week
- 7-Star IBs can earn 100 cycles a week
- 8-Star IBs can earn 150 cycles a week
- 9-Star IBs can earn 250 cycles a week
- Diamond IB Presidents Team can earn 500 cycles a week
- Diamond IB Chairmans Team can earn 750 cycles a week
Elysium Network pays a Matching Bonus on residual recruitment binary commissions (see above).
The Matching Bonus itself is paid out on nine unilevel team levels:
- 1-Star IBs earn a 20% match on level 1 (personally recruited affiliates)
- 2-Star IBs earn a 20% match on level 1 and 15% on level 2
- 3-Star IBs earn a 20% match on level 1, 15% on level 2 and 5% on level 3
- 4-Star IBs earn a 20% match on level 1, 15% on level 2 and 5% on levels 3 and 4
- 5-Star IBs earn a 20% match on level 1, 15% on level 2 and 5% on levels 3 to 5
- 6-Star IBs earn a 20% match on level 1, 15% on level 2 and 5% on levels 3 to 6
- 7-Star IBs earn a 20% match on level 1, 15% on level 2 and 5% on levels 3 to 7
- 8-Star IBs earn a 20% match on level 1, 15% on level 2, 5% on levels 3 to 7 and 2.5% on level 8
- 9-Star IBs and higher earn a 20% match on level 1, 15% on level 2, 5% on levels 3 to 7 and 2.5% on levels 8 and 9match
Elysium Network pays a match on ROI payments via the same seven-level deep unilevel team residual recruitment commissions are paid on (see above).
ROI match payments are paid as a percentage of returns paid to unilevel team affiliates and retail investors as follows:
- 16% on level 1 (personally referred retail customers and recruited affiliates)
- 1% on level 2
- 0.5% on levels 3 to 7
Note that from level 2 the ROI match is only paid on recruited affiliates within the unilevel team.
5 Star and PFC Quarterly Bonus Pool
Elysium takes 2.5% of company-wide calculated returns and places it into the 5 Star + PFC Quarterly Bonus Pool.
5-Star IB and higher ranked affiliates receive an equal share in the pool, paid quarterly.
Diamond Bonus Pool
Elysium Network takes 3% of company-wide sales volume and places it into the Diamond Bonus Pool.
Diamond IB President and Chairman ranked affiliates can qualify for shares in the Diamond Bonus Pool as follows:
- one share per month an affiliate ranks at Diamond IB Presidents Team
- two shares per month an affiliate ranks at Diamond IB Chairmans Team
Shares reset every quarter upon payment of the Diamond Bonus Pool.
Joining Elysium Network
Elysium Network affiliate membership is €548.95 EUR and then €79.95 EUR a month
There is a cheaper affiliate option for €179.90 EUR but I’ve mostly ignored that as it’s not part of the MLM opportunity.
The two primary concerns regarding Elysium Network are securities fraud and pyramid recruitment.
Elysium Capital states it generates ROI revenue via
authorised prime brokers and liquidity providers registered with the Swedish Financial Supervisory Authority (FSA) in full transparency and with segregated accounts in highly reputable European banks: Swedbank, Nordea Bank, SEB and Barclays.
That’s great for the brokers, but Elysium Network is the one offering the passive investment opportunity.
Elysium Capital therefore needs to be registered with securities regulators, and as far as I can tell they aren’t. Not in Sweden, or anywhere else in the world.
Why would an MLM company opt to operate illegally? Well usually it’s because they aren’t doing what they say they are.
Without legally required audited third-party accounting filings, it’s impossible to confirm Elysium Network is indeed paying returns with external revenue.
This is a regulatory failing on Elysium Network’s part, and charts like the one below are not a substitute:
With respect to pyramid recruitment, the only retail side of the business appears to be a mysterious €500 EUR minimum passive investment opportunity.
Affiliates are given access to backoffice software, which is what the MLM opportunity primarily focuses on.
Elysium Capital fails to go into detail regarding standalone investment, emphasizing its irrelevancy within the MLM opportunity.
What you’re left with is paying affiliate membership fees and getting paid to recruit others who do the same.
Elysium Network pseudo-compliance split membership fees into “admin fees” and “software licenses”, but at the end of the day this is how you sign up as an affiliate.
Paying commissions on affiliate membership fees constitutes recruitment commissions, and any MLM company in which this is the primary source of commissions paid out is operating as a pyramid scheme.
Also if Elysium Network’s trading software is all that it’s cracked up to be, why is it only available to affiliates?
And why is there literally zero detailed information provided about Elysium Network’s trading bots? This is another regulatory compliance fail.
The last thing I want to touch on is Elysium Network’s corporate structure.
There’s Elysium Network, Elysium Capital and Elysium Social. Why?
There’s literally nothing about Elysium Network that couldn’t be condensed into one simple website.
Elysium Capital’s website is useless. You can’t actually do anything on it except read vague investment promises and the team’s corporate bios.
No idea if Elysium Social has its own website. I did note there’s an Elysium Social operating out of Maryland in the US, so there’s a potential trademark dispute in the works there.
If you’re still hell-bent on joining Elysium Network I suppose you could ask your potential upline what their own ROI earnings have been and how much they’re making through the ROI match.
Level 1 pays out an 16% match so if there’s nothing there you can put two and two together.
At a minimum Elysium Network needs to address securities regulatory concerns.
Fleshing out an actual retail investment opportunity can come next, but there’s no point while what you’re offering is illegal anyway.
Update 14th August 2020 – As at the time of this update Elysium Capital has failed to address securities fraud concerns.
The company has however named the broker it will be committing securities fraud through.
Update 8th September 2020 – I was sent in a copy of Elysium Network’s current compensation pan.
Based on that I’ve updated the compensation section of this review with a few percentage changes, rank qualification criteria and the 5-Star pool bonus.
I’m also noting this “disclaimer” from the compensation plan:
Elsyium Capital Limited does not accept clients from the U.S.
This in and of itself is a red flag but also ties into Elysium Capital’s securities fraud and pyramid recruitment red flags.