How are Pyramid schemes disguised ?

Pyramid schemes may be disguised as
games, chain letters, buying clubs,
motivational companies, mail order
operations, or investment organizations.
􀁖 Some pyramid promoters try to make their
schemes look like multi-level marketing
operations. The sale of legitimate products
may distinguish multi-level operations from
pyramids. When the emphasis is on recruiting
new members rather than selling something
of value the organization is probably an illegal
pyramid.

A pyramid scheme takes on a line of
products and claims to be in the business of
selling them to consumers. However, little or
no effort is made to actually market the
products. Instead, money is made in typical
pyramid fashion, from recruiting. New
distributors are pushed to purchase large and
costly amounts of inventory when they sign up.
􀁖 Pyramid schemes often choose products
which are cheap to produce and have no
established market value, such as new miracle
products, exotic cures, etc. The best way to
avoid a disguised pyramid fraud is to know what
to look for in a legitimate income opportunity.