How Pyramid Schemes Work

By: Dave Roos

How Pyramid Schemes Work: Author’s Note

"Work from home and earn $5,000 a month!" I see signs like this everywhere and have always wondered what kind of scam could be behind it. After researching this article on pyramid schemes, I have a good idea. Pyramid schemes are so successful because they prey on our desire for quick, easy money. In this scam, however, the odds are stacked so definitively against you that's it's almost mathematically impossible to make any cash at all. It's sad to think of all the people who bought a starter kit with dreams of lucrative sales and a bright future managing a team of salespeople, all from the comfort of home. In situations like this, it's best to heed some sage advice: If it seems too good to be true, it probably is.


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