Posted 9:22 PM by Blah blah

Multi-level Marketing Scam (Part 2): "Pre-Paid Legal Services"

Just after I got done warning you about multi-level marketing companies like Amway, which are all scams and not worth your time, this guy tried to convince me to join this company called Pre-Paid Legal Services as a sales associate (PPD on the NY Stock Exchange.)

The idea of PPL is to offer people monthly "legal insurance" services, like health insurance and an HMO. For supposedly $26/month, customers get access to this one law firm (at least in California). This guy helps sells PPL and is recruiting new "sales associates." He was relentlessly upbeat and gave me the hard sell, telling me about its potential growth rate, the lack of general knowledge about this service, about how once I joined the team as a "sales associate," how he'd help sign up new members to my team, how he already has other people lined up, but that he's waiting for me to attend the informational meeting, blah blah blah.

Anyway, this sounded like a good idea at first. It wasn't till I asked him how we'd actually make money that I hit a red flag. Which is that you make money partly from a fee on new sales associates you sign up and THEIR sales. This is the whole essence of a legal pyramid scheme. (A normal "pyramid scheme" is illegal and considered fraud.)

Tonight PPL had an informational meeting at the Biltmore Hotel in Santa Clara, and he and another guy called me, pushing and coaxing me to go. The other guy was super upbeat too, talking vague terms and sounding like a used car salesman. After a little surfing for info, I found these three sites that totally slammed Pre-Paid Legal Services. BUSTED! Check them out:

- Mediamoogle.com (My Pre-Paid Legal Story---by a guy who tried it, with links to tons of negative articles about people suing PPL, how they have lost money and customers, etc.)
- Pre-Paid Plunges As Growth Evaporates (TheStreet.com).
- Class Action Lawsuit Against Pre-Paid Legal Services.

In my view, multi-level marketing is just as bad as a pyramid scheme and technically is not that much different. MLM companies should all be outlawed. People are wasting tons of time, money, and goodwill with their friends and families in being suckered in by these companies!

Check out Pyramid Scheme Alert for extensive info on these pervasive scams. Here are

Raymond's Easy Ways to Spot Multi-Level Marketing Companies

1. Salespeople like YOU will make money based on how many OTHER salespeople you recruit to sell, essentially COMPETING with you! Why would any business person encourage others to compete with them for a limited market??? Makes no financial sense. Eventually the next generation of recruits runs out of customers. The key thing is you get a commission based on the sales of other people you recruit to sell with you! That means MULTI-LEVEL MARKETING.
2. All the people you talk to from that company are relentlessly upbeat and positive about the business.
3. They are called "sales associates."
4. They give you an aggressive hard sell without much financial or technical details. They don't KNOW the details if you ask for specifics. Their sales pitches and meetings sound like fundamentalist religious cults.
5. Their website has no substance, no financial or other technical details about their business.
6. Their meetings look like religious revivals---all show and no substance. People walk around in crisp business suits high-fiving each other. They bring out a main speaker who's some backwoods redneck who's a high school dropout, who brags about his millions, about his nice car and big house, who trots out his blonde bimbo wife, all to sell YOU on the sham that you can be the same way too! (You can tell I've been to some of these meetings.)