MLM and Pyramid Schemes

Bhutan, within a couple of years, has witnessed the growth of a massive Multi Level Marketing Pyramid Scheme in the form of Enagic selling ‘miracle water,’ or Kangen.

This is not the first pyramid scheme in Bhutan and it won’t be the last, but what marks out Enagic as worthy of special attention is how secretive it is about its business structure, the amount of money involved and how it has grown massively to rope in large numbers of Bhutanese.

The pyramid scheme is also different in that it has grown rapidly during the pandemic as there are large numbers of people locked down in their homes and many also looking at ways to make an income.

Enagic fits all the legal definitions under Bhutanese laws and even government notifications of being a pyramid scheme. The main source of revenue is in recruiting additional members and making money off the commission of selling them overpriced products.

The dangers from a pyramid scheme like Enagic are three fold. The first is that it poses a huge financial risk as studies elsewhere show that the vast majority of its members stand to lose vast sums of money. Only the company and the top recruiters make real money.

The second danger is in its dubious ‘cure all’ health claims which is not backed by medical science or thorough research. Its demonization of tap and mineral water is unacceptable.

The third danger is on the social front as the very nature of the scheme encourages its members to recruit family members, friends and those known to them. As people lose money, it will create social fissures.

While many of the members are literally brainwashed into the scheme with many dubious claims they cannot countercheck, it also incentivizes a predatory approach as people try to recover their money or gain additional income.

All of this  happening in the middle of a pandemic when people are at their most vulnerable is sickening at many levels.

While members and recruiters will like to argue back saying nobody is forced to join, but it is also true that many join under false assumptions given to them of financial independence, flexi time and a lifestyle change.

A lot of energy is spent by the company, network and members to recruit new members by misleading social media posts and advertisement.

 While all of the above and other pyramid schemes have been happening under the noses of authorities, the agencies have either not woken up to this threat earlier or are happy to pass the buck for now.

The promise of easy money is but a wolf’s trap laid out for sheep seeking taller grass. –  James Jean-Pierre