Saturday, May 5, 2012

Investigating IBC Travels... looks like a TVI Express clone

A Clone of My Own
A Clone of My Own (Photo credit: Wikipedia)
When you plan to join acompany, you don't want to see any link between it and a known scam, such as TVI Express, which was busted in Australia, China, Indonesia, USA, and many more countries.

So when a company goes through quite a bit of effort to hide such links, you should probably become VERY VERY interested in WHY would they do so.

The more someone try to hide something, the more interested investigators get. This is sometimes known as the "Streisand effect" (named after Barbara Streisand, who tried to suppress aerial photo of her house by suing a website, but instead inspired people to download the photos even more, thus achieving the opposite effect).

IBC Travels is such a new "opportunity", and it is desperately hiding its link to TVI Express... and failing.

Thursday, May 3, 2012

"They did it wrong", a special variant of "no true Scotsman" fallacy

Another frequent "rebuttal" from defenders of an "opportunity", when given evidence of malfeasance such as members arrested, charged, and convicted of running a pyramid scheme, is usually "they are bad people and did it wrong", with an implied corollary, "the company is completely innocent and cannot be responsible". One such example is highlighted below:
[Linganay wrote] ...All those reports you posts I've read about scam? It's not the company but it's just referrring to people who have not been honest. They just collected money but did not remit to the company. The company has been vigilant and terminated those who abused and misrepresented the company.  (see original version )
But what was the "reports you post I've read about scam" Linganay referring to? Here are just SOME of the headlines:
  • TVI Express "leader" in Majene, Indonesia sentenced to 9 months in jail for defrauding the public
  • Central Bank of Lesotho in Africa issued press release that TVI Express is operating illegally in the country and urges all citizens to refrain from participating
  • Times News of South Africa reported that Tarun Trikha is the head of TVI Express scam, which involved over 1 billion SA Rands, with over 50000 victims in South Africa alone
  • South Africa announced first arrest of TVI Express members for running pyramid scheme.
  • TVI Express Trio "TeamTVIOz" convicted of running pyramid scheme in Australia, and of falsely using logos of hotels, airlines, and cruise lines.
  • A dozen people arrested in China in multiple cities (2009, 2010) for running "British TVI Travel Express" scam. 
There was nothing about upline cheating downline by taking their money and not giving them membership. All were describing TVI Express itself as a pyramid scheme, and was shut down as a scam in multiple countries. You can check the actual news articles

Clearly, Linganay was mislead by his upline into believing that all the fraud reports about TVI Express are lies or "misunderstandings" caused by a few "bad apples", when it is TVI Express itself that is rotten.
(Linganay's full rebuttal involved several other fallacies that will not be addressed here, but perhaps another time. )

Linganay is essentially guilty of using a variant "no true Scotsman" fallacy, which I call the "they did it wrong" argument.

The "it paid me" argument

Bernard Madoff's mugshot
Bernard Madoff', the biggst Ponzi schemer
to hit the US. Nobody believed it, until it was revealed.
(Photo credit: Wikipedia)
One of the most used arguments to counter a critic is the "It paid me" argument. However, this argument is fallacious on multiple levels, it should be considered with extreme suspicion whenever you see it. This argument can also appear in several variants, and recognizing this may be difficult.

 Here is an actual example, in response to an article I wrote about TVI Express scam:
[Kaloy wrote]:I just exited my 1st P450,000 pesos from the so called "scam" and will going to take my vacation soon he he. Thank you Lord for TVI Express!
This is referring to TVI Express,  a scam organized from India, convicted on multiple continents from 2009 to 2011 with dozens of people sent to jail. Yet this comment was posted in March 2012, from the Philippines where this scam is still thriving.

There are two interpretations to this statement: a) it paid me therefore it's not a scam, or b) it paid me therefore I don't care if it's a scam or not.  Thus, the reply can be considered an "equivocation fallacy" because the author never did explain just exactly what was meant by his response. Was it meant as refutation, or a 'so what' remark?

Let's study both interpretations.


Tuesday, May 1, 2012

Cognitive Bias: the straw man fallacy



Straw man (or lady?)
Straw man (or lady?) (Photo credit: Wikipedia)
In MLM, very often defendants of such a MLM will resort to "straw man argument" to "defeat" criticism of of their MLM. 


A straw man argument is based on misrepresentation of an opponent's position. To "attack a straw man" is to create the illusion of having refuted a proposition by replacing it with a superficially similar yet DIFFERENT proposition (the "straw man"), and refuting it, without ever having actually refuted the original position.


Let me give you an example. The following was supposedly relayed by "Team TVI Oz", convicted pyramid scammers in Australia, before they were convicted, and posted on Indonesia website of the same scam, explaining why they are NOT a pyramid scheme (and Australian government is wrong). 

"A pyramid scheme is defined by following characteristics:
--> No product
--> Returns for investments
--> People only at the top make money and rest don’t. All late comers lose their money.
As per the WFDSA and any Direct Selling body, above mentioned are the points which define a Pyramid scheme."
Sounds reasonable, until you do a little fact-checking, because WFDSA never said such things. The citing is completely bogus. 



Monday, April 30, 2012

Cognitive Bias: Confirmation Bias

Today's Dilbert is a humorous look at confirmation bias:


http://www.dilbert.com/strips/comic/2012-04-30/

Transcript:
Boss: I read a book about how to be a great leader, and realized I don't do any of those things.
Boss: I am surprised that a book with so many errors could get published.
Boss: It must have been written by a disgruntled underling
Wally: Do those exist?
The boss comes in with a preconceived notion that he's a great leader. When he reads a book about leadership that he doesn't agree with, his confirmation bias lead him to conclude that the book must be wrong instead of himself.

Then he immediately reasons that it must be written by someone opposed to him, such as "disgruntled underling".

Then someone immediately agrees with the boss, "yeah, you must be right".

Sounds like a lot of MLMers I've observed.

Sunday, April 29, 2012

Do you know the five fatal flaws of MLM system?

There are no symbols that represent skepticism...
(Photo credit: Wikipedia)
In studying MLM for a while (several years), I determined that multi-level marketing, also known as network marketing, has five fatal flaws. There are two other problems that exacerbates the flaws to trap the unwary.

The five flaws are:
  1. Creating your own competitors
  2. Conflict of Passive vs. Active Income
  3. Questionable profitability of product
  4. Similarity to Pyramid Schemes
  5. Cult-like indoctrination of members and prospective members
Add to that problems like
  • Pseudo-MLM scams
  • Late Government Intervention
And you have a VERY dangerous business to be in, unless you apply some critical thinking and analysis.

Are you willing to learn the five fatal flaws of MLM? And perhaps, how to avoid them?

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Introduction

Historian of science and Skeptics Society foun...
Michael Shermer, famous skeptic
(Photo credit: Wikipedia)
A MLM Skeptic is a blog about skepticism, MLM, scam, and critical thinking.

I am an amateur scam tracker and learned a lot about MLM, as well as pseudo-science and skepticism, when I realized that most people don't approach MLM or income opportunities with enough skepticism to keep themselves safe, and they are lead on by people who are taught to use every unscrupulous tactics in the book ( and a few that are not) to exploit every type of cognitive bias in the brain to get people to commit and hand over their hard earned money.

en:Image:RANDI.jpg (Original text : James Randi)
James Randi, well-known skeptic
(Photo credit: Wikipedia)
The skeptic blogs, such as Skeptoid, Skeptic's Guide to the Universe, and Skepticality (all excellent), and even famous sites of Michael Shermer or James Randi, are mainly out to debunk pseudo-science and promote critical thinking.

The MLM blogs, such as MLM helpdesk, BehindMLM, MLM Watchdog, and so on, are mainly about MLMs, reviews of MLMs, news about MLMs, and so on. Some of them study MLM business models, but not necessarily any fact checking about claims and such.

I don't know of or can find any blog that covers critical thinking regarding MLM claims or scams.

I've previously written a paper on how I consider scams to be "pseudo-economics". So I thought, why not start a blog that features both together? Why not bust pseudo-economics using the same sort of critical thinking used by skeptics on pseudo-science?

Thus this blog is born.

I hope to incorporate reviews of businesses (both business model and marketing claims), as well as topics on critical thinking, cognitive bias, how scammers use cognitive bias against you, and so on.

So stay tuned.

EDIT: I did not include an email feedback address. That's intentional, as there's a lot of hate from believers of "scamworld".

However, if you insist on sending some love or hate my way, here's an address for you:

amlmskeptic
at
hotmail
dot
com

EDIT2:  Seems quite a few... doubters are asking what are my "credentials" to "attack" the MLM "industry".

First, never was in any MLM. I've been exposed to them, tried a few products, but never joined any.

Second, I am not aware I need any credentials to analyze something. Does football fans need any credentials to analyze football games? Surely not!

If you don't agree with what I wrote, feel free to comment, but you better back up your opinion with some facts or proper logic. If you just vent your spleen like "I hate what you said you #(*$^)&$#!"  I obviously reserve the right to not publish such comment on my blog.

EDIT3: Yes, I am aware that to be grammatically correct it should be "An MLM Skeptic".  (See grammar rule reference on a vs. an) I'm going to cheat a little, okay?