How Network Marketing Is Misused for Scams

While legitimate network marketing businesses exist, scammers often misuse this model to disguise fraudulent activities. They rely heavily on personal connections — friends, family, and colleagues — to build trust and expand quickly. Typical structure: - Entry fees instead of real product value - Incentives for recruitment - Hierarchical earning model Participants are encouraged to bring more people into the system to earn commissions. Over time, this becomes unsustainable and most people lose money. Understanding the difference between genuine businesses and exploitative structures is essential.