Unsure about MLM schemes? Don’t succumb to peer pressure
TODAY file photo
I read the report “Trio charged with promoting illegal MLM scheme, unlicensed forex trading” (Jan 9), and am reminded that it is so easy for people to fall for such multi-level marketing (MLM) schemes.
Firstly, because the earnings promised seem lucrative — the “high profits”, “quick returns” after buying the “package”.
Then, the agents even let the early investors “gain” so that they can bring in more people to invest in the scheme with the incentives given.
Personally, I have been to such talks twice in the past. The first time, two people bought into the scheme. The second time, more than 10 people in the group joined.
Why? During the second session, the agents paid out the high “dividends” as promised to the initial investor for the scheme.
People always tend to believe more when they start to see other people being able to make money. Especially when the person getting the money also encourages others to do likewise.
Even though we have such easy access to information these days, the easiest way for us to be influenced is still by our peers.
When an MLM scheme sounds too good to be true, do some research and check the information given about the product and company. Understand what they are doing and why they can give such high profits.
Most people are investing their hard-earn money from years of saving. I always feel sorrowful when I see those who had lived a frugal life lose their lifelong retirement savings this way.
If you are not sure, do not invest or be pressured into buying something recommended by an investment manager or an acquaintance. Even friends or relatives may ask you to do so, but resist the temptation to act quickly without checking or thinking about it.
Check the Monetary Authority of Singapore’s investor alert website to see if the company is on the list.
Where investments are concerned, there are always risks.
