How do I convince someone not to do MLM (scam)...?
July 25, 2013 3:56 PM   Subscribe

I'm really just looking for a definitive link from something like that will call out a MLM company as a scam.. so that I can point my friend to it and say "see? it's a scam. don't do it." Specifically, I'm looking for a reputable website that says Ambit Energy is a MLM scam, and I don't really want to waste my time to tracking it down (esp since a simple Google search seems to be flooded with SEO-sleazeballs). Any help?
posted by lostguy to Work & Money (8 answers total) 3 users marked this as a favorite
This may be the best link:

Found by searching for: "ambit energy" scam.
posted by Mo Nickels at 4:16 PM on July 25, 2013

Is the person thinking about becoming a salesperson or a customer?
posted by magnetsphere at 4:17 PM on July 25, 2013 is a great general resource on MLM scams, though they do not currently have an Ambit page.

This page is full of personal reviews and stories about how awful Ambit Energy is: click here. They get a very poor Consumer Reports rating based on these reviews, from both customers and people involved in being a sales rep.

As I understand it, Ambit functions by selling power to consumers, much like PG&E would, but directly by taking advantage of deregulated-energy states. This seems like bad news to me-- there's no oversight of their activities, and you as the consumer are very unlikely to be their priority. As a seller, your livelihood would also be on the line, not just your energy needs/costs.

There are many scattered reviews online, like this one and you may want to point your friend to some more of them. Note that while every company has a few bad reviews, not every company has search results that indicate either HORRIBLE reviews, or SUPER HAPPY AMAZING marketing pieces, with no in-between. If the search results for any company come up with the company's name and MULTIPLE "Is company a scam?" websites on the first Google results page, it's probably too good to be true.
posted by blnkfrnk at 4:18 PM on July 25, 2013

The answer to the question in your title is that you may not be able to. Because one of the things MLMs are really good at is giving facile answers that sound plausible to counter accusations that they are scams. So likely, whatever you throw at her, the MLM will have an answer for, and if she wants to believe in them and believe in the magic of what they're trying to sell her, you may not be able to win this one.

When I googled ambit energy multi-level marketing scam, you're absolutely right, it seemed to be mostly participants in the company who are relentless cheerleaders, not actual analyses of the business model. However, when I looked more generally for energy multi-level marketing scam, I got some decent looking results about how these energy resale businesses work generally. So maybe check those out, for general explanations of these companies and why the majority of "associates" never make back their initial investments.

Also, as a general rule, you should never be paying someone else in advance for the privilege of a job. If they're so convinced you're going to make gobs of money, why aren't they willing to let you start working, and then take a commission down the line? The fact that they're asking for hundreds of dollars up front is suspicious in and of itself.
posted by decathecting at 4:20 PM on July 25, 2013 [3 favorites]

try quackwatch and do a google search on their site. ambit energy is mentioned in this general but long article on mlms.
posted by wildflower at 4:21 PM on July 25, 2013

The google ads that appear on this page if you are not logged in are really creapy.
It appears that MLM scammers are themselves prey for even nastier predators.
posted by Abinadab at 5:55 AM on July 26, 2013

"What's Wrong With Multi-Level Marketing?" has always been the best general article on the topic and therefore might also be useful in this case since it applies to any MLM scenario.
posted by Dansaman at 6:26 AM on July 26, 2013 [2 favorites]

There are a ton of things on-line about MLM. Some are straightforward things like Amway or Mary Kay. Some folks get the pink Cadillac, some folks make a few extra bucks actually selling the product.

The biggest fact about MLM is that to reach higher levels you're not selling more product, you are recruiting people to sign up into the MLM structure (pyramid.)

If your friend enjoys spending her time hustling people to sign up to sell for her, and she enjoys mentoring and training and cheerleading, then she may do okay with an MLM. Otherwise, she may make a few extra dollars signing people up for her service.

As with any service, it's either good or it's not. You can show her the reviews of the service and you can ask her: "There are lots of MLM opportunities out there, what makes this one so attractive to you?" See what she says.

The sad fact of the matter is that MLM recruitment meetings are evangelical. They fire people up and get them to commit. Once someone steps over that threshold , there's usually no going back. She may have already paid, and once she's done that, she's in.

Now, can I introduce you to my friends who have a closet of Mary Kay to sell you at a discount? How about the Herbalife folks who have all those supplements on hand? Or the Shaklee people who have a shit-ton of detergent?

All I can tell you is leave it alone. Some people will learn from experience. For your part practice saying "no" an awful lot. Say it definitively and unequivically. "No, I don't want to sign up." "No, I won't come to a meeting with you." "No, I don't want to discuss it."
posted by Ruthless Bunny at 8:09 AM on July 26, 2013

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