What would you say if a family member or a friend was about to start a job in which 99 per cent of the people who worked there lost significant amounts of money while being “employed”? And what if you found out that this “job” exploited financially vulnerable people and used extreme pressure tactics to force them to stay and perform?
Would you tell them to go for it – to take a course of action that could make a bad financial situation worse and cause lasting damage to relationships? I doubt it. You’d be a terrible friend or relation if you condoned such a thing.
When consultants make a sale, a portion of their commission goes to the person who recruited them
Sadly, such jobs exist and staggering amounts of people and money are involved. They’re called multi-level marketing companies, or MLMs for short, and sell anything from cosmetics to health, beauty and home care products.
In the United States alone, according to the Federal Trade Commission, more than 18 million people, mostly women, are involved in this $36 billion (Dh132.2bn) industry. I’ve even seen some of my friends in the UAE get taken in, and these companies know their target audience well.
They primarily target women who need extra income. Social media has been a huge boon to these companies because it allows “consultants” to show how awesome their lives are by being their own boss. But in reality, it can be an expensive nightmare for the majority of the “consultants”.
Covid-19 has added another layer to this. More people are out of work and desperate. They want something where they can work from home, and so they are prime candidates for predation. MLMs are even selling Covid-19 “cures”, prompting the US Federal Trade Commission to issue official warnings to 10 prominent companies engaging in this trade.
To start selling products, new consultants have to buy a significant amount of products, often worth tens of thousands of dirhams. When they make a sale, a portion of their commission goes to the person who recruited them. So, the more people you recruit to sell, the more you make. This is what makes it similar to a pyramid scheme.
These vulnerable people then flood their social media platforms and talk to everyone they know who is sympathetic enough to buy their products, but that can only take them so far. Eventually, that well runs dry, and that’s when it gets expensive, because these salespeople are often left with thousands of dirhams worth of products and no way to sell it.
These companies often encourage salespeople to take out credit cards to buy products to sell. Then, when they’re stuck with products and nobody to sell them to, they have steadily mounting credit card bills with 17 to 45 per cent interest rates and find themselves in a terrible financial hole.
They also use the same manipulation tactics as cults. They isolate you from people who would question your behaviour and the benefits of the job. They prey on the financially vulnerable. They make you feel like if you just worked a little bit harder, you can achieve the great benefits they tout so publicly.
According to Douglas M. Brooks, an attorney who represents victims of MLMs, the same professionals who help to de-programme cult survivors are also seeing a lot of former MLM salespeople with similar symptoms and in just as dangerous a place.
If you have the chance to help someone, you should do it, especially if it’s someone you care about. The next time you see a friend or family member talking about a “great new opportunity” where they are selling things, have a long chat with them. Make sure they are informed about all the potential financial pitfalls of their new job before it’s too late. They’ll thank you eventually.
Dubai schoolteacher Zach Holz (@HappiestTeach) documents his journey towards financial independence on his personal finance blog The Happiest Teacher
More from Rashmee Roshan Lall
The line up
Friday: Giggs, Sho Madjozi and Masego
Saturday: Nas, Lion Bbae, Roxanne Shante and DaniLeigh
Sole DXB runs from December 6 to 8 at Dubai Design District. Weekend pass is Dh295 while a one day pass is Dh195. Tickets are available from www.soledxb.com
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Our family matters legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
The advice provided in our columns does not constitute legal advice and is provided for information only. Readers are encouraged to seek independent legal advice.
Ziina users can donate to relief efforts in Beirut
Ziina users will be able to use the app to help relief efforts in Beirut, which has been left reeling after an August blast caused an estimated $15 billion in damage and left thousands homeless. Ziina has partnered with the United Nations High Commissioner for Refugees to raise money for the Lebanese capital, co-founder Faisal Toukan says. “As of October 1, the UNHCR has the first certified badge on Ziina and is automatically part of user's top friends' list during this campaign. Users can now donate any amount to the Beirut relief with two clicks. The money raised will go towards rebuilding houses for the families that were impacted by the explosion.”
What can you do?
Document everything immediately; including dates, times, locations and witnesses
Seek professional advice from a legal expert
You can report an incident to HR or an immediate supervisor
You can use the Ministry of Human Resources and Emiratisation’s dedicated hotline
In criminal cases, you can contact the police for additional support
LA LIGA FIXTURES
Saturday (UAE kick-off times)
Leganes v Getafe (12am)
Levante v Alaves (4pm)
Real Madrid v Sevilla (7pm)
Osasuna v Valladolid (9.30pm)
Sunday
Eibar v Atletico Madrid (12am)
Mallorca v Valencia (3pm)
Real Betis v Real Sociedad (5pm)
Villarreal v Espanyol (7pm)
Athletic Bilbao v Celta Vigo (9.30pm)
Monday
Barcelona v Granada (12am)
Quick%20facts
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UAE currency: the story behind the money in your pockets
Company name: Play:Date
Launched: March 2017 on UAE Mother’s Day
Founder: Shamim Kassibawi
Based: Dubai with operations in the UAE and US
Sector: Tech
Size: 20 employees
Stage of funding: Seed
Investors: Three founders (two silent co-founders) and one venture capital fund
The%20Kitchen
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The Bio
Favourite holiday destination: Either Kazakhstan or Montenegro. I’ve been involved in events in both countries and they are just stunning.
Favourite book: I am a huge of Robin Cook’s medical thrillers, which I suppose is quite apt right now. My mother introduced me to them back home in New Zealand.
Favourite film or television programme: Forrest Gump is my favourite film, that’s never been up for debate. I love watching repeats of Mash as well.
Inspiration: My late father moulded me into the man I am today. I would also say disappointment and sadness are great motivators. There are times when events have brought me to my knees but it has also made me determined not to let them get the better of me.
match info
Southampton 2 (Ings 32' & pen 89') Tottenham Hotspur 5 (Son 45', 47', 64', & 73', Kane 82')
Man of the match Son Heung-min (Tottenham)
UAE squad
Humaira Tasneem (c), Chamani Senevirathne (vc), Subha Srinivasan, NIsha Ali, Udeni Kuruppuarachchi, Chaya Mughal, Roopa Nagraj, Esha Oza, Ishani Senevirathne, Heena Hotchandani, Keveesha Kumari, Judith Cleetus, Chavi Bhatt, Namita D’Souza.
Pharaoh's curse
British aristocrat Lord Carnarvon, who funded the expedition to find the Tutankhamun tomb, died in a Cairo hotel four months after the crypt was opened.
He had been in poor health for many years after a car crash, and a mosquito bite made worse by a shaving cut led to blood poisoning and pneumonia.
Reports at the time said Lord Carnarvon suffered from “pain as the inflammation affected the nasal passages and eyes”.
Decades later, scientists contended he had died of aspergillosis after inhaling spores of the fungus aspergillus in the tomb, which can lie dormant for months. The fact several others who entered were also found dead withiin a short time led to the myth of the curse.
About Housecall
Date started: July 2020
Founders: Omar and Humaid Alzaabi
Based: Abu Dhabi
Sector: HealthTech
# of staff: 10
Funding to date: Self-funded
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