Thursday, 8 March 2012

Consumer Alert - Diamond Rewards

Another pyramid scheme appears, this time calling itself "Diamond Rewards".

Curiously, with this pyramid scheme there IS actually a product of sorts. The enrollment fee of US$315 buys you a 2 carat sapphire. You then recruit others with the tempting offer of the sapphire and as more and more people join and buy their sapphire you get greater and greater rewards.

But how much is a 2 carat sapphire actually worth? I found a web site that would sell me a 2.5 carat synthetic sapphire for the princely sum of, get this, $77. A bigger sapphire for less than a quarter of the price. What do you think the chances are that “Diamond Rewards” sells you a synthetic gem?

Above all, I think the following diagram from their web site illustrates everything you need to know about this scheme.

Like all pyramid schemes, where rewards are primarily linked to the recruitment of other people into the scheme, “Diamond Rewards” is based on a number of lies. A lie about the gemstone, about the profits you’ll make and a lie about the business model.

It's a pyramid scheme. Consider yourself warned!

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