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International Association to Expose, Study and Prevent Pyramid Schemes
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Pyramid Scheme Alert Update
Pyramid Scheme Alert is a non-partisan, non-profit, all-volunteer
consumer education group. Contact Robert L. FitzPatrick, Pres. at
info [bat] pyramidschemealert.org
October 2, 2008
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There are two News and Commentary Reports in this edition. Also, see Special
Reports listed at the bottom of the page.  Please feel free to forward this newsletter.

Lessons from Multi-Level Marketing Can Shed Light on America's Real Estate/Banking/Wall
Street Crisis
Criminal Charges Filed Against Amway in India; MLM, Gold Quest, also Prosecuted,
with Managing Director now in Prison

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Lessons from Multi-Level Marketing Can Shed Light on America's Real Estate/Banking/Wall
Street Crisis
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For those who are asking how our national economy fell into the current financial
crisis or how the nation's business leaders could not have seen it coming or how
 the federal government could have allowed it to happen, a study of multi-level
marketing (MLM) - which attracts more than five million Americans each year with
 its "income opportunity" - can offer answers. MLM serves as a mirror image of the
real estate/banking/Wall Street catastrophe. The basics are all the same. To understand
Wall Street's motives and tactics, therefore, we need only look into the MLM mirror.
 See "Financial Crisis: A Mirror Image of MLM
LINK

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Criminal Charges Filed Against Amway in India; MLM, GoldQuest, also Prosecuted,
with Managing Director now in Prison
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PSA Logo
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In
a letter to a Director of  Pyramid Scheme Alert, the chief of police in one of India's
largest states, Andhra Pradesh, wrote that a criminal case has been booked by the
government's Criminal Investigation Division against Amway India for promoting a
 "Money Circulation Scheme" in the disguise of Direct Selling. He stated, "Now the
case has been charge sheeted and it is proved that Amway is nothing but Money
Circulation
Scheme. Andhra Pradesh Government now has issued a G.O. against Amway under sections
8 of the Prize Chits & Money Circulation Schemes (Banning) Act, 1978."
India's "Prize Chits & Money Circulation Schemes" law is equivalent to anti-pyramid
scheme or anti "endless chain" statutes of many US states. At the federal level,
 such scams are covered in America under Section 5 of the FTC Act outlawing "unfair
and deceptive trade practices."
The criminal charge against Amway has been reported in the Indian news media,
LINK
but not in America. One online news account
LINK
reported, "the state government  banned the controversial multi-level marketing
company Amway India Enterprises from publishing any material and advertisements
violating the Prize Chits and Money Circulation Schemes (Banning) Act.
"The crime investigation department booked cases against Amway alleging it is just
a money circulation scheme. The home department has asked Amway not to publicize
 their schemes in violation with the Act."
The report  noted that Indian authorities also brought criminal charges against
another MLM, GoldQuest, which has operated in many other countries. Famous
film personalities in India are said to be involved with GoldQuest,
according to the reports, and police booked "cases against some senior
health department officials and prominent doctors" who were promoting
the MLM scam.
The report stated that the  "managing director of GoldQuest, Ms Pushpam Appala Naidu,
who was remanded to the judicial custody two months ago is currently in Chennai
prison."
The police action against Amway follows a police raid on nine Amway offices in 2006.
 Amway India, in turn, had appealed to Andhra Pradesh High Court challenging the
 police raids and sought suspension of the probe into its business model. But the
high court dismissed its petition on July 7, 2007, saying that the company's scheme
was merely to enroll members for earning quick money.
For a full and graphic picture of how Amway operates in India - especially if you
live in India - read WITH SOAP IN THEIR HANDS & HOPE IN THEIR HEARTS
LINK
by Ramjee Chandran from The Bangalore Monthly Magazine in July, 1998. Chandran
characterizes
Amway as a cause of "economic evil" and describes the pitiful scene of uninformed
and low income Indians investing their life savings in the "non-retailing" sales
 scheme in which 99% are doomed to lose.
In 2005, PSA's President spoke at a seminar in Sri Lanka
LINK
of Central Bankers from five South Asian countries, including India. The
representatives
from India reported many complaints against Amway but also said various states differed
in regulation and that, despite complaints and largescale losses among consumers,
the courts had been allowing Amway to operate.
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Special Reports for Consumers...
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The Myth of MLM Income Opportunity
LINK
The Amway Myth
LINK
Why the FTC Lets MLM Run Wild In America
LINK
Recognizing the Disguises of Pyramid and Ponzi Schemes
LINK
How Wall Street Gets Fooled by Multi-level Marketing: Herbalife's Latest Ruse
LINK
The Five Red Flags of Product-Based Pyramid Schemes
LINK
Sign Up to Receive PSA Updates
LINK
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Contact Information
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Pyramid Scheme Alert
Tel: 704-334-2047
Fax: 704-334-0220
Email: info [bat] pyramidschemealert.org
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Pyramid Scheme Alert.org | 1800 Camden Rd. Ste. 107, #101 | Charlotte | NC | 28203
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