MLM refers to the behavior that organizers and developers illegally acquire wealth through developers or require the developed personnel to obtain the qualification to join on the condition of paying a certain fee. The essence of pyramid selling is "Ponzi scheme", that is, the money of the latecomers is distributed to the income of the pioneers.

New pyramid scheme: no restrictions on personal freedom, no ID cards and mobile phones, no group classes. But under the banner of capital operation, attracting people to cheat money, using luxury cars, wearing gold and silver, etc. Use money to attract your relatives and friends, and finally make you lose everything.

The behavior of MLM is as follows:

1, "admission fee": MLM organizations usually collect money in various names, and gangs can only absorb funds if participants pay;

2. "Pulling people's heads": After paying the "admission fee", the MLM gang will do everything possible to let the participants develop offline;

3. "Team salary": gangs usually cheat wealth by "developing offline and making commissions at different levels". Everyone must keep their eyes open and be vigilant. There will be no pie in the sky.

First of all, we should be vigilant when we talk about the return as hype. High returns are bound to have high risks.

Secondly, no matter how the form of MLM changes and develops, its essence is still to pay the entry fee by purchasing shares, develop offline personnel and form a hierarchy, and take the "performance" of offline personnel as the profit basis.

Therefore, to identify pyramid schemes, we need to look at three characteristics:

1, registration fee

Whether it is necessary to subscribe for goods or pay fees to obtain franchise qualifications or develop others' franchise qualifications to seek illegal interests;

Step 2 pull people's heads

Whether it is necessary to develop others to become their own downline, and pay remuneration to the developed personnel based on the number of people directly or indirectly developed, so as to seek illegal interests;

3. Method of payment

Whether to directly or indirectly develop personnel to calculate remuneration and seek illegal interests.

If it meets the above characteristics, it may be suspected of pyramid schemes.

legal ground

Article 244-1 of the Criminal Law of People's Republic of China (PRC) organizes and leads pyramid selling activities, and in the name of selling goods and providing services, requires participants to obtain the qualification of joining by paying fees or purchasing goods and services, and forms a hierarchy in a certain order, directly or indirectly taking the number of people who have developed as the basis for remuneration or rebate, inducing and coercing participants to continue developing pyramid selling activities of others, defrauding property and disrupting economic and social order. If the circumstances are serious, he shall be sentenced to fixed-term imprisonment of not less than five years and fined.