Multi Level Marketing...is it a scam?

[inafix]

Hi, I have been approached by a family friend to join a new MLM co. from the US and would be grateful of advice from anyone who has been involved with MLM in the past.

 

It involves selling Acai berry juice which is an up and coming health and dietary supplement. The product I don't have a problem with and I think this is what my friend has been sold on. What I'm a bit dubious about is the way in which it will be marketed.

 

The product will not be available in the UK until December but they are recruiting people now to build up a 'network' before it's launched. Commission (they call it compensation!) and bonuses will be paid using a 'binary system'. I have googled this but it seems very confusing. They ask for your National Insurance Number so they can pay your tax? Not sure about this either as I am self-employed, and why would they need this now if no product is being sold yet? They also take a percentage back for their 'charity' ? which gives back to the peolple in Brazil who live and work near where the berries are harvested?????

 

I DO know how MLM's work as I have been involved with them in the past. I am aware they're not the get rich quick schemes they want you to believe, but it is possible to earn a few extra quid for a short time.

 

Any advice on this particular scheme would be greatly appreciated.

[geoff1248]

I would suggest that you see if the MLM company is on this list:

http://www.mlmconsultant.com/mlm_company_list_directory.htm and do some further research on line.

MLM companies seem to come and go very quickly in the US and this could just be another form of pyramid selling.

Do you hold the stock? What is your upfront financial commitment?

[inafix]

Stock is shipped direct to your customers and there is no financial outlay.

[inafix]

Yes it's on the list.

[geoff1248]

The Binary System of payment is based on your ability to recruit new members; you need 2 new members before you benefit hence the term binary. These new members in turn need to recruit 2 new members etc etc.

Before you go any further I suggest that you google "Acai berry juice". I think you will see all you need to know from some of these sites.

[electron99]

Whatever you decide, do not give them your national insurance number.

If they recruit you on a self employed basis, they don't need it as you make your own tax arrangements.If they claim they are employing you, you should ask for a contract of employment before parting with any personal information.

 

I would add that dietary supplements are fads that go in and out of favour very quickly, so would not view this 'opportunity' as long term.

[buzby]

This has been seen before - in the US they ask for your 'Social Security Number' this is primarily to uniquely identify the person being dealt with. They've simply modified this for the UK market by asking for the NI number - it has NOTHING to do with 'paying' your tax.

 

Avoid.

[borisbeaver]

For what it's worth, it sounds a bit like a pryamid scheme to me.