Be Your Own MLM Detective Today - Here's Your Due Diligence Training
Internet Investigate! DETECTIVE Program 2007™
13 SIMPLE INVESTIGATIONS TO AVOID GRIEF BEFORE YOU
START A HOME BASED BUSINESS OR MLM!
Rod Cook B.s.,M.A.,M.B.A.
PLUS: FTC Warning on the Bottom of the Page!
LOW TECH QUICK INVESTIGATION FOR YOU NEW MLM DETECTIVES
1. Look at the supposed MLM or Affiliate company’s website. First suspect clue would be no street or city address! Worse yet, only an email address, no phone number. Then look for the pictures and names of the owners/operators of the company. Not having Executives pictures and names on a company website is very suspicious and a good reason not to join that company. This is not hard MLM Detective research!
DETECTIVES! ANOTHER LOW TECH FAST PUSHBUTTON QUICK INVESTIGATION
2. If the Address is PMB that means it is a "rent a mailbox" from a commercial mail box establishmnet. They do not have the legal protection of a U.S. post office box for you! Get suspicious when you see PMB! That is very, very suspicious! A second part of this if they tell you not to use U.S. Mail and send money orders/cash via Fedex or UPS... Run Quickly! This little trick research keeps MLM Detectives out of court rooms!
HI TECH DETECTIVE PUSHBUTTON INVESTIGATION = DUE DILIGENCE
3. Some wise, seasoned Internet Affiliate and MLM - Network Marketing Detectives use the space sattelite views on http://earth.google.com/ to look at satellite pictures showing the size and location (ADDRESS) of a supposed Affiliate/MLM company office. If the Company address is a trailer house or home? Run! Special editors note: Top Japanese Distributors will not join a U.S. company until they investigate with this visual "Space Spy" technique! Your friends will call you the MLM Space Detective!
HI TECH PUSHBUTTON SEARCH INVESTIGATION FOR DUE DILIGENCE
4. This takes more time but is worth it! Use Google to investigate an MLM - Network Marketing or Affiliate program enter the following into this advanced search on this major search engine:
A. Put in the MLM - Affiliate Company's name (next owners too) plus the word "scam". Go through two pages of results. Look for forum - message comments for legitimate complaints (see D below). B. Next do the same for company (owners) name plus "complaints, lawsuits, and “news” articles archived on search engines.C. Also check the name of who registered the web site domain of any new company claiming: exciting, amazing, incredible, proprietary, never seen before in the universe, revolutionary, products, services or technologies! Check http://www.whois.net/ for the domain lookup. Companies with wonderful offerings would work on a project for more than 3 months. Smart, legitimate executives register domain names first!D. Here is a warning on MLM due diligence for Affiliate OR MLM Researchers: There are sad sites and forums that are unfairly negative toward all Affiliate - MLM - Network Marketing companies. Ignore these "Affiliate MLM Bashers" and only look for appropriate information.HI TECH PUSHBUTTON SEARCH INVESTIGATION FOR MLM DETECTIVES (YOU)
5. This research technique is quicker than the searches above for MLM - Party Plan - Network Marketing and Affiliate Companies. ALEXA is a search engine that tells us the traffic (amount of people that visit a website):
A. The next time someone approaches you about a “Hot Opportunity,” download the tool bar from www.alexa.com and look at the Alexa rating, which shows web traffic. This is a great research web tool!B. If you look at Quixtar or Mary Kay, two of the largest older MLM companies, you will see they rank 6,000 and 7,000. Those are top rankings. The MLM Watch Dog you are looking at right now, ranks around 45,000 (which is considered good). If you look at www.Linksurge.net, a no cost affiliate program I put up online, I am very happy with an Alexa rating of 340,000 after just 120 days, and we are at about 150 working members. C. A lady asked me to look at a 5 year old company that she said was “Hot”.... the ranking was 386,000. That is in the mud for a 5 year company! My quick research put the lady down as deluded or hyped! If she had told me it was 45 days old I would have said 386,000 = ok. The lower the number, the more traffic to the site. The best MLM Detectives are familiar with Alexa research!LO TECH FAST WAY TO INVESTIGATE AFFILIATE - MLM - NETWORK MARKETING CO.
6. Run from MLM - Network Marketing - Party Plan or Affiliate Companies that don't let you use a credit card that will accept charge backs. Returns? Honest companies allow refunds on products returned within 60-90 days (or longer 7 states require a year)! You don't have to be a Private Eye Detective to researrch for this...
LO TECH BEST WAY TO RESEARCH AN MLM - NETWORK MARKETING CO.
7. Another low tech secret of MLM Millionaires and their research! Don’t let the money over-excite you! Use the products or services being sold first! If they excite you, then look at the money. You should try sharing and selling the products/services to test them out. Spending some money to test a company and their offerings is a wise thing to do. This is more common sense research than true MLM - Network Marketing Detective work
LO TECH ALERT TO INVESTIGATE AFFILIATE - MLM - COMPANY.
8. DON'T SPEND OVER $500 TO START: See the FTC warning below this article. There are also approximately 21 states that say this should be the maximum to get started in any business opportunity (not just MLM). Two states say it must be kept under $200. Following the advice in #6 should not cost over $500. See the LATEST Federal Trade Commission (FTC) warning below. Dectetives research for violations of laws!
DETECTIVES A MUST DO WAY TO INVESTIGATE A COMPANY USING - MLM - NETWORK MARKETING
9. NEXT HOME BUSINESS AFFILIATE OR MLM DUE DILLIGENGE RESEARCH: Go to the Better Business Bureau (new window) web site for the city where the MLM-Network Marketing company is located. Some are free, some charge $2! You are looking for the number of complaints the BBB has NOT resolved. If there are more than 3-5, hold off joining. This research could serious problems.
SLOW BUT FAIR WAY FOR DETECTIVES - TO INVESTIGATE A COMPANY USING - MLM - NETWORK MARKETING
10. FOLLOW UP HOME BUSINESS RESEARCH: Check with the Attorney General in the state where the company is located. Be very brief with your email or phone call and stick with asking, “Affiliate or MLM company XXX is located in ____city, in your state, do you have complaints against company XXX?” A complete list of Attorney Generals for you aspiring MLM - Network Marketing Detectives is listed by link in.
The folks are busy and it may take a while to get through on the phone, if they have email inquiry it will take a while - here they are see AG's at: MLM WatchDog DUE DILIGENCE & COMPLAINTS Library.
HARD AND FAST DETECTIVE'S WAY TO RESEARCH A COMPANY
11. HOME BUSINESS "WATCHOUT": An email solicits you to a "HOT" Affiliate, MLM, Party Plan or Network Marketing Company!
A. Look for exclamation marks and capital letters used to lend legitimacy or urgency! Beware of disclaimers such as “this is not a pyramid selling scheme or scam” (legitimate offers don't contain such claims). Detective Researchers don't believe promises of fast wealth. B. If you feel, see or hear "Get Rich Quick!” ..........RUN! Detective Researhers know If it sounds too good to be true, it usually is! MLM - Network Marketing takes some work, like any good home based business. INVESTIGATE POLICIES AND PROCEEDURES - PAY PLAN OF A COMPANY
12. RESEARCH AND READ THE FINE PRINT IN THE AFFILIATE OR MLM CONTRACT: These are the enrollment agreement or terms of agreement and policies and procedures. These together are a business contracts, enforceable in a court of law. The Distributor Rights Association says they shouldn't be over 15 pages long. Don't sign if you don't feel comfortable about the contract. See www.mlm-dra.org for warnings about companies violating contracts. Here your Detective skills may need help from a lawyer!
MLM DETECTIVES INVESTIGATE PAY PLANS OF COMPANIES!
13. COPY THE PAY PLAN AND ASK QUESTIONS: Then find an expert to analyze it.
A. If it only pays for signing up new people and not sales of products/services - run!B. There's a copy of my MLM Compensation Pay Plans Book on Amazon. Search for my name by author - Rod Cook. No, this is not a shameless promotion for my book. My book is the only one with big pictures, diagrams and detailed to help both the new person and expert. MLM Watchdog ethics let me say it's a good book! Plus my book has a whole chapter on researching and avoiding Pyramid Schemes.Rod Cook
MLM WatchDog for over 20 years! YOU ARE NOW TRAINED TO BE AN INVESTIGATIVE REPORTER - SIGN UP!
If you want more information on Home Based Businesses, join the MLM WatchDog mailing list (below) and stay informed about what is going on in the MLM world of business from a fair and balanced perspective. We have saved people from joining companies that were scams, or about to go out of business! Do your Due Diligence!
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NEXT STEP FOR INTERNET DETECTIVES
FTC + WATCHDOG INVESTIGATIONS & DUE DILIGENCE
Internet Home Based Business Opportunities: Are Some Just A Scam?
Generally does not include most good Affiliate, MLM - Network Marketing - Party Plans
Jan 2006 – You see them monthly, daily and weekly. If it's grabbing people to sell so-called web access kiosks, web connected ATMs. or dealing in other Internet-related activities, consumers are being lured to the vast commercial potential of the web by business promoters.
However, the U.S. FTC (United States.Federal Trade Commission) says that many of these home business opportunities are scams that promise far more than they can possibly deliver. Ed. Note: Detectives in training You need to do Due Diligence! Go back above and do your Detective work on your computer!
The scam artists pull in innocent entrepreneurs with false promises of big earnings with little work. They pitch fraudulent home business and business opportunities on the web via mass spam; through TV infomercial's, classified ads in your local newspaper, opportunity magazine "advertorials", telemarketing pitches, free seminars, and mass mailings.
Here are a few recent examples of Internet-related business opportunities identified by the Federal Trade Commission (FTC) that often pull in unsuspecting entrepreneurs.
Example 1: Selling walk-up Internet access
The Pitch: The promoter claims you can earn big money by selling machines or kiosks that provide walk-up Internet access - for a fee - in places like airports, hotels and shopping malls. They supposedly suck in dollar bills and quarters like a vacuum machine. The machines cost thousands of dollars, but the promoter says the cost can be recovered because the machines generate automatic "amazing" earnings. And the company promises to help find (read that sell) profitable locations for the machines. Editors Note: This was done once trying to use an MLM - Network Marketing type pay plan... but it was a scam, just like the 100 others that sprung up without an MLM pay plans. Do your Investigations and Due Diligence!
The Problem: Guess what? The high-traffic locations that the promoter promises are gone. The buyer's machines get placed where demand for Internet access is low. As a result, a would-be entrepreneur can't possibly make the promised earnings. Ur Ed. note: Detectives this also comes up with ATM machines - Investigate = Using YOUR MLM - Network Marketing Detective Tools above
Example 2: Giving seminars/meetings on making money on the Internet
The Pitch: The promoter advertises that you can earn more than $150,000 as an "Internet Consultant" who sponsors free seminars to teach other consumers how to make money on the Internet.
The Problem: The seminars really feature fast moving high-pressure sales pitches for the promoter's Internet yellow pages or for another form of Internet advertising. Even though the "shady" promoter promises to provide Internet and sales training to buyers - for a fee of several thousand dollars - the buyers never get the promised training. In the end, they never earn even remotely the promised amounts.
Example 2: Providing TV access to the Internet
The Pitch: The fast talking promoter promises that you can earn thousands and thousands of dollars a month by recruiting people to sell devices that provide television access to the Internet. Ed. Note: This one is dead and gone if you investigate it, but it may get recycled! Detective in Training help friends with Doing their Due Diligence above!
The Problem: The program claims to pay participants based on how many people they recruit into the program, not on their product sales. No product or actual services? That makes the program a pyramid scheme - not a legitimate multi-level marketing plan. Pyramid schemes are illegal. Mathematically, nearly everyone who participates in them loses their money. When there are no new recruits, the pyramid collapses. MLM Watch Dog Ed. Note: MLM Detectives -- This is at the heart of most Pyramid Schemes, Investigate and Do YOUR Due Diligence! Ask - would I buy this product or service if there weren't a chance to make money!
The FTC gives this advice to consumers thinking about an Internet-related business opportunity:
•Consider the promotional deal carefully. If it claims buyers can earn a certain income, then it also must give the number and percentage of previous purchasers who achieved the earnings. If an earnings claim is there - but the additional information isn't - the business opportunity seller is probably violating the law. Make this part of your Due Diligence to avoid scams.
Consider the promotional deal carefully. If it claims buyers can earn a certain income, then it also must give the number and percentage of previous purchasers who achieved the earnings. If an earnings claim is there - but the additional information isn't - the business opportunity seller is probably violating the law. Make this part of your Due Diligence to avoid scams.•Get earnings claims in writing. If the business opportunity costs $500 or more, then the promoter must back up the earnings claim in a written document. It should include the earnings claim, as well as the number and percentage of recent clients who have earned at least as much as the promoter suggested. If it's a work-at-home or other business opportunity that involves an investment of under $500, ask the promoter to put the earnings information in writing. ED Note: This is new in FTC warnings as of this date! In general they have never enforced the $500 federal limit, or pushed registrations at the federal level. The Watchdog notes this may be a change in practice for the FTC. Either way, the $500 limit is a good guideline, if it's over that amount ...turn your scrutiny knob up to high!
Get earnings claims in writing. If the business opportunity costs $500 or more, then the promoter must back up the earnings claim in a written document. It should include the earnings claim, as well as the number and percentage of recent clients who have earned at least as much as the promoter suggested. If it's a work-at-home or other business opportunity that involves an investment of under $500, ask the promoter to put the earnings information in writing. ED Note: This is new in FTC warnings as of this date! In general they have never enforced the $500 federal limit, or pushed registrations at the federal level. The Watchdog notes this may be a change in practice for the FTC. Either way, the $500 limit is a good guideline, if it's over that amount ...turn your scrutiny knob up to high!•Study the business opportunity's franchise disclosure document ( MLM WatchDog Ed. Note: required if over $500 in six months). Under the FTC Franchise Rule, many business opportunity promoters are required to provide this document to potential purchasers. It includes information about the company, including whether it has faced any lawsuits from purchasers or lawsuits alleging fraud. Look for a statement about previous purchasers. If the document says there have been no previous purchases, but the seller offers you a list of references, be careful: the references, they are probably phonies.
Study the business opportunity's franchise disclosure document ( MLM WatchDog Ed. Note: required if over $500 in six months). Under the FTC Franchise Rule, many business opportunity promoters are required to provide this document to potential purchasers. It includes information about the company, including whether it has faced any lawsuits from purchasers or lawsuits alleging fraud. Look for a statement about previous purchasers. If the document says there have been no previous purchases, but the seller offers you a list of references, be careful: the references, they are probably phonies.•Interview each previous purchaser in person, preferably where their business operates. The FTC requires most business opportunity promoters to give potential purchasers the names, addresses and phone numbers of at least 10 previous purchasers who live the closest to the potential purchaser. Interviewing them helps reduce the risk of being misled by phony references.
Interview each previous purchaser in person, preferably where their business operates. The FTC requires most business opportunity promoters to give potential purchasers the names, addresses and phone numbers of at least 10 previous purchasers who live the closest to the potential purchaser. Interviewing them helps reduce the risk of being misled by phony references. •Contact the attorney general's (AG's) office, state (see the library, this web site - opens a new window) or county consumer protection agency and Better Business Bureau, both where the business opportunity promoter is based, and where you live to find out whether there is any record of unresolved complaints. While a complaint record may indicate questionable business practices, a lack of complaints doesn't necessarily mean that the promoter and the business opportunity don't have problems. Unscrupulous dealers often change names and locations to hide a history of complaints. MLM Watch Dog Ed. Note: This is good but not fast (busy phones frustrate Detectives) as we explained in the Investigation Due Diligence above!
Contact the attorney general's (AG's) office, state (see the library, this web site - opens a new window) or county consumer protection agency and Better Business Bureau, both where the business opportunity promoter is based, and where you live to find out whether there is any record of unresolved complaints. While a complaint record may indicate questionable business practices, a lack of complaints doesn't necessarily mean that the promoter and the business opportunity don't have problems. Unscrupulous dealers often change names and locations to hide a history of complaints. MLM Watch Dog Ed. Note: This is good but not fast (busy phones frustrate Detectives) as we explained in the Investigation Due Diligence above!•If the business opportunity involves selling products from well-known companies, call the legal department of the company whose merchandise would be promoted. Find out whether the business opportunity and its promoter are affiliated with the company. Ask whether the company has ever threatened trademark action against the business opportunity promoter. MLM Watch Dog Ed. Note: Good but not fast to do, even expert MLM Detectives have trouble getting the right phone numbers!
If the business opportunity involves selling products from well-known companies, call the legal department of the company whose merchandise would be promoted. Find out whether the business opportunity and its promoter are affiliated with the company. Ask whether the company has ever threatened trademark action against the business opportunity promoter. MLM Watch Dog Ed. Note: Good but not fast to do, even expert MLM Detectives have trouble getting the right phone numbers!•Consult an attorney, accountant or other business advisor before you put any money down or sign any papers. Entering into a business opportunity can be costly, so it's best to have an expert check out the contract first. If the promoter requires a deposit, ask your attorney to establish an escrow account where the deposit can be maintained by a third party until you make the deal.
Consult an attorney, accountant or other business advisor before you put any money down or sign any papers. Entering into a business opportunity can be costly, so it's best to have an expert check out the contract first. If the promoter requires a deposit, ask your attorney to establish an escrow account where the deposit can be maintained by a third party until you make the deal.•Take your time. Promoters of fraudulent business opportunities are likely to use high-pressure sales tactics to get you to buy in. If the business opportunity is legitimate, it'll still be around when you're ready to decide.
Take your time. Promoters of fraudulent business opportunities are likely to use high-pressure sales tactics to get you to buy in. If the business opportunity is legitimate, it'll still be around when you're ready to decide. Reporting Possible Fraud
If you suspect a business opportunity promotion is fraudulent, report it to:
•The state's attorney general office in the state where you live and also in the state where the business opportunity promoter is based. ATTORNEY GENERAL LINKS HERE
The state's attorney general office in the state where you live and also in the state where the business opportunity promoter is based. ATTORNEY GENERAL LINKS HERE•Your county or state consumer protection agency. Check the blue pages of the phone book under county and state government.
Your county or state consumer protection agency. Check the blue pages of the phone book under county and state government. •The Better Business Bureau in your area and the area where the promoter is based.
The Better Business Bureau in your area and the area where the promoter is based. COMMERCIAL BREAK!
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