Chain letters promising get rich quick schemes

Definition; chain letter - Is a typed or written letter, email message, or other text based communication that asks the reader to pass the message on to someone else, usually with the promise or threat of something.

Basic Outline of Chain Letters / Pyramid Schemes

This article hope to deal with chain letters promising instant riches via make money fast schemes. Therefore where 'chain letters' are referred to in this article it is in respect to the form of 'make money fast' letters. Some of the most disturbing and unethical chain letters have had no connection to get rich quick schemes. One of the most well-known e-mail chain letter hoaxes was the Jessican Mydek hoax, which described a seven year old suffering from acute ' cerebral carcinoma' and promised that the American Cancer Society would donate 3 cents to cancer research for every forward of the email. Most countries have now made 'Make Money Fast' chain letters illegal, only chain letters which purport something like 'bad luck' or a 'curse' are often still legal. Another famous chain email was the 'The Dave Rhodes' letter which included a list of 10 people but altered from the norm by suggesting you forward the letter to to bulletin boards (forums). Analysts of this chain letter have worked out that it would have needed to have reached 11 million bulletin boards before people would have received any income.

The growth of chain letters promising instant riches is without a doubt on the increase, and specifically in connection with email messages and the Internet. Before the world of the Internet existed it required the cost of a stamp to send a letter. This limited the extent to which chain letters were passed on, because there was a real front cost to starting the scheme, so most people decided to ignore them. The growth of chain letters has become such an annoyance that they are now prohibited by most postal services and ISPs. In addition, the majority of UK ISP's (Internet Service Providers) will usually terminate your account for perpetuating any chain letter or email spam.

Chain letters promising instant riches have been classified by some as the original pyramid scheme, with the recipient passing money to the sender and the recipient then receiving money from those he/she sends the letter too. Of course no wealth is generated by this, just a loan passed from one person to the next. However not all chain letters can be classed as pyramid schemes, and likewise not all pyramid schemes (most now include real life recruitment drives) are chain letters.

The chain letter message comes in many variations, but the key points are always the same. They promise the possibility of making a large sum of money from a small amount of work and investment. A chain letter will typically represent a process like:

• You receive a postal letter or email message.
• It will include claims of instant money making.
• All you need to do is participate to do the same.
• There will be a list of names and addresses requiring a sum of money to be sent to.
• It will then outline the process of how to send the message to someone else.
• This usually means copying out the same letter verbatim and including your name at the bottom of the list.
• The letter will state your success is based upon how many people you can send the letter too.
• The more people who join the scheme equates more money sent to you.
  
• Finally you will receive a ridiculously large sum of money once it gets to level 6 or 7 below you.

The most successful chain letters / pyramid schemes work by employing an air of illusion of legality and professionalism. Without doubt the basic pyramid scheme outlined above would fool only the most gullible of readers. For example a successful scheme could employ reports, facts, and figures for a loan based financial or health insurance service. But the basic premise is always the same no matter how complicated or professional the initial message is, it's all about sending a sum of money to the sender in return for the promise of future riches.

Hypothetical Pyramid Scheme

If for example you decided to create your own chain letter pyramid scheme the potential for income would work like this. As you are on the first level you would ask for £1 from five people.

• Level 1 - 5 people send you £1 - Total Collected £5
• Level 2 - 25 people send you £1- Total Collected £25
• Level 3 - 125 people send you £1 - Total Collected £125
• Level 4 - 625 people send you £1 - Total Collected £625
• Level 5 - 3125 people send you £1 - Total Collected £3125
• Level 6 - 15625 people send you £1 - Total Collected £15625

After this your name would probably drop from the list capable to receive any income. As you can see hypothetically a successful chain letter can generate alot of money (especially if you are receiving more than £1 per signup). But as the letter reaches level 6 there would be 15,625 sending out the same letter. The possibility of these people earning the same amount is vastly reduced because the amount of potential victims is decreasing at a rapid rate. By level 9 there would be 1,953,125 people sending out the same letter.

The difference between MLM “multi-level marketing” and Pyramid's?

The distinction between “multi-level marketing” schemes, and a illegitimate pyramid scheme is now becoming more and more blurred. A good majority of pyramid schemes are currently trying to pass themselves off as a MLM scheme. Well what's the difference?, a legitimate MLM scheme will actually sell a product of significant value to other people. A MLM scheme's recruitment works in the same way as a Pyramid scheme, a business will make a product and will then attempt to sell it indirectly. They do this by recruiting people not only to buy but to sell the product.

The problem with MLM and Pyramid Schemes?

The fact is that no matter how big your local city, town, village or Internet is, there are always a finite number of people interested in any given product. This means that as more and more people join the scheme the potential customer base will at some point dry up. And as more and more join the emphasis upon recruitment needs to be curtailed which rarely occurs, this eventually means most MLM's are doomed to produce more people who will failure rather than succeed.

------------------------

Getting back to pyramid's, it seems that many of the more successful schemes are now trying to pass themselves off as MLM's. The recruitment model of both has always been very similar so it's a logical step. Of course pyramid schemes never have a 'product' to sell, so what they will be offering will have no inherent value, but they will no doubt try and baffle the potential victim with countless reports, facts and figures to suggest otherwise. Currently the most typical “product” offered by a pyramid is a worthless financial or statistical report, an electronic code to unlock something they state is of value, an e-booklet with tips to get rich, mail order customer list or a website to attract additional victims. These products will have no value, but by selling them it will usually ensure that the pyramid has legality.

In conclusion both MLM's and the more professional Pyramid's will initially seem identical, the difference is that MLM's offer a genuine 'product' to sell and Pyramid's sell something worthless in the hope of recruiting others to sell it. Many people would class MLM marketing in essence, as a legal pyramid scheme

Tips on what to avoid

As outlined above joining a pyramid through either a real world connection, chain mail postal letter or email is a risky venture. History has shown that the vast majority of participants will lose money to pay for the few at the top who reap the rewards. Sadly the unlucky majority will be left with nothing, or an expensive worthless product or marketing tool. Therefore your best tool for identifying and avoiding a professional pyramid scheme is common sense. Before making a decision to join something resembling a pyramid scheme you would be best advised to avoid,

• A scheme which only pays a commission for recruiting distributors. This type of pyramid is often classed as illegal by the authorities.
• Plans where a new distributors has to up front purchase expensive marketing tools and products. When MLM's require the purchase of expensive inventories they often collapse when the merchandise cannot be resold, with only those at the top of the pyramid without financial losses.
• Make sure the product you sell seems illegitimate and is not a miracle cure vitamin or product. If your going to sell something then research and do your homework about it to make sure it claims are legitimate. Consumers as well as potential distributor would be wise to avoid some of the health-related multilevel products altogether. Many of the nutritional vitamins and low-cholesterol minerals are invariably overpriced and without checking with a local GP could be unnecessary. In the past they were referred to as 'quack' medicines. And the manufacturer claims of it being remedy could will be unproved or bogus.
  
• Where a large percentage of your earning is transferred to your recruiter.
• Spend time to consider the in and outs of the business opportunity, and do not sign-up under a pressure-filled environment.
• Check with your local Business Bureau or adviser to ask their opinion. They usually have leaflets with information on how to avoid fraudulent, deceptive and unfair business schemes.
• Evaluate whether the potential earnings claimed are too good to be true.
• Most multilevel marketing plans take a long-term investment of equity and effort to finally pay off.

And here is the typical chain letter / chain email

PAY ATTENTION !!!!!

AN OPPORTUNITY LIKE THIS COME BUT ONCE IN A LIFETIME

Hello Sir/Madam,

Only recently did I come across this letter while reading my daily emails, and it has completely altered my life. I had credit card bills worrying the hell out of me, so much my hair was beginning to go gray. From the beginning I was curious about the letter because it promised me a substantial sum of money for NO RISK whatsoever. It began me wondering how was this possible? I had read about all the people making BIG BUCKS on the Web and assumed I must be missing out on a secret. The sender of the letter was a Mr. Graham M. Simons, and stated since starting his business scheme me he had received over £400,000.00 in cash!! I was shocked to be honest and began to think it was a scam. But after I connected him saying this he asked me to try the plan and see for myself. As money is in short supply and I am paying off all my debts I said I would think about it for a few days. I concluded in the end that there was not much to lose and followed the instructions exactly and mailed out 200 letters, 100 by post and 100 by email. He said to me this amount was surely enough to pay back my initial investment, and he was right because the money started pouring in!! To begin with it came slowly at first, but after eight weeks, I was getting more and more and it got to such an extent I could not open all the letters in a day. After about 16 weeks the money stopped coming, and after checking my bank statements and recording of my earnings it totaled £123.419.00! OK it wasn't the £400,000.00 promised but I was over the moon. I just couldn't believe it. The other factor was the advice MR. Simons gave me made sure the whole thing was perfectly legal because it offered a SERVICE and people received a report of mailing addresses for the initial signup fee. This is needed since no one wants to do anything too risky and end up in trouble. So if you want to know the secrets of how to write a LEGAL letter and create a LEGITIMATE service then you will need to mail a £1.00 coin / cheque to each of the seven names below. Along with the money please include a note with your name and address stating you wish to be on the new mailing list.

1. C. Akbar - 23 High Street, Derby
2. D. King - 12 Church Street, Manchester
3. Alfred Collingham - 134 Mews Drive, Surrey
4. M J Winters - 45 Highgrove Avenue, London
5. T Warner - 123 Tottenham Court, London
6. P. Mertons - 76 Suger Drive, Portsmouth
7. Donald Ronald Craig - 11 Hillsborough, Leeds

When you have completed the above instructions and the people have received the money, you will be allowed to join the mailing list and begin the mailing of your own new letter. This can be done in two ways:

1) Through Royal Mail Postal Service

2) E-mail if you have access to the Internet.

It is perfectly LEGAL because the fee your receiving is for allowing people to join the MAILING LIST you receive further instructions, advice and awards for success. Your best chance of success is to mail out 200 letters, and this should guarantee that 15 people will send you £1.00, this will eventually lead in 16 weeks to over 11,000,00 people sending you £1.00. Just remember to put your name at the top of the list, and take the 7th placed member deleted. At some point when you are very rich you will fall off the list. You will laughing all the way to the bank.

Conclusion

Unless you are the originator (probably subject to legal prosecution for fraud) the likely outcome of joining any form of pyramid scheme is you will lose money. They are basically setup so only the person/people at the top can profit. Common sense will tell you that the only way to make ethical wealth is by honest hard work, the shortcuts promised do not exist and are only created to bilk you out of money.