June, 2022
From: Robert L. FitzPatrick
Dear PONZINOMICS Readers, Colleagues and Friends,
Reality…
Ponzinomics traces the invention and history of "MLM" as a disguised pyramid scheme and its evolution to cultism. It lays out the MLM pyramid structure, money transfer formula, and exposes the delusional dogmas about "belief" overcoming market and math realities. It defines MLM as a destructive belief promoted by pyramid predators, intent on capturing minds for financial, sexual and personal exploitation. The pyramid scheme is MLM's illicit system of gaining money. "Direct selling" is its false identity for luring consumers and evading law enforcement. MLM's utopian promises, assumed power to dispense wealth and happiness and its devious methods of enrollment, persuasion and control constitute a delusional belief system capable of mental enslavement.
The reality of MLM presented in Ponzinomics is shared by many consumer advocates, bloggers, independent researchers, podcasters, millions of victims, and an increasing number of attorneys and journalists.
… and "Alternate" Reality
This reality is rejected by USA regulators (many of whom later work for MLMs or their law firms or trade group), academia (which does not teach or research MLM), publishers (which have never published even one critical book on the MLM phenomenon), and major media (which have never conducted an in-depth investigation of the MLM "industry"). These institutions advocate or tacitly endorse an "alternate" reality.
In this "alternate" world, MLM is "direct selling", offering "income opportunity" to millions from "person to person" retailing. Despite its "endless" recruiting chain proposition, promising "unlimited" income, MLM is said to be based on personal retail selling to end-user customers, one sale at a time. They do, however, add disclaimers that MLM is risky and possibly unethical, and "some" MLMs (never saying which ones) are illegal pyramid schemes.
The warnings about "some" MLMs being illegal pyramid schemes are rendered useless to consumers since the FTC informs the public, "There is no bright line disclosure that would help consumers identify a fraudulent pyramid from a legitimate MLM.”
At a recent consumer conference on MLM, government regulators on a panel were asked to offer an example of a "legitimate" MLM that is not a pyramid scheme. No regulator responded with even one company name. To date, no regulator has ever publicly named a single MLM that matches their alternate reality.
Testing Reality
The FTC's alternate reality is not based on evidence or data on consumer losses, or any other financial marker. The FTC also has gathered no data on direct (retail) selling by MLM. The FTC has never conducted any study of MLM. The FTC has never explained how MLM's promise of "infinite" expansion, which provides "unlimited" income potential to all, forever, is not inherently deceptive and harmful. The FTC does not have facts or evidence, It has a "policy" that MLM is legal and legitimate.
The reality, presented in Ponzinomics, is based on statistical studies, lawsuits and prosecutions that consistently show 99% consumer loss rates and absence of "direct (retail) selling". It is founded also on direct experience and innumerable accounts of family, career, and social damage, along with countless accounts of cult persuasion and control methods. As it turns out, the stories and the experiences are the same the world over.
The Ponzinomics reality is founded on systematic reviews of over 400 MLMs including MLM contracts, business model analyses, pay plans, policies, rules, and disclosures that consistently show calculated deception and inherent fraudulence producing massive and inevitable consumer losses. As it turns out, the MLM structure, operations, pay system, recruiting methods and devastating financial consequences are the same the world over.
Related to the alternate reality that the FTC bases its "policy" on, Ponzinomics painstakingly documents the factors of political influence-buying by MLMs in Congress, and the revolving door of FTC officials taking lucrative jobs and consulting work from MLMs. The book also examines the years of Big Lie propaganda influencing millions tragically to place their hopes in MLM for security, fulfillment and livelihood.
