How is Global Intergold different from a pyramid scheme?

How is Global Intergold different from a pyramid scheme?

Formerly known as Emgoldex, Global InterGold says it is an online shop selling and buying 999.9 physical investment gold bars supplied by accredited gold refiners.

It is often said that in ‘Gold Coast, gold does not lie enticingly’, the claim of Global InterGold that its objective is to make gold available to everyone is rather curious and suspicious to say the least.

At the surface level, it is a fact that gold is a highly liquid precious metal that can always be quickly and easily exchange for money worldwide as it also helps to preserve and increase capital. Buying and keeping gold is a form of investment in itself. However, Global InterGold tends to make a fuss out of this simple economics.

The scheme claims it has developed a revolutionary marketing program allowing clients to pay up to 90% of the value of investment gold bars at the expense of rewards. That is, in exchange for marketing the products from the company’s online gold store to others, are required to participate in an incentive program.

So in essence, Global InterGold is a recruitment-based multi-level marketing programme that uses gold as its product of reference. From the look of its structure, there are not much gold trading activities involved but affiliates and or investors will be remunerated based on new recruits into the programme which makes its more or less a Ponzi scheme.

As described below, rewards are credited to the clients’ accounts in exchange for making recommendations of the company’s goods and services resulting in the expansion of the Online Gold Shop’s client portfolio.
According to the company, Global InterGold clients can elect to:
Pay the full amount;
Make a minimum prepayment of 150 EUR and offset the remaining sum with rewards.
Sell the gold bars back to the Online Gold Shop at the current selling price at any time.
Within 14 days after making the purchase, clients can cancel it and the money will be refunded.

A possible red flag was when it was reported out of the Philippines that Global Intergold is EmGoldex renamed. EmGoldex, which stands for “Emirates Goldex”. It turned out that EmGoldex was then tagged a Ponzi scheme and was banned from doing business in the Philippines. The change of name to Global InterGold is not more or less than a ploy to defray all the negative public relations debt the scheme had gathered in the Philippines.

Proponents of Global Intergold say the company invest in “online gold”, investors should, therefore, have the opportunity to receive their investment back in cash, in real gold bars or keep reinvesting, but it appears that you need to bring at least two people to participate, and those people will bring other two and so on. It is just another pyramid scheme with the modus operandi of a Ponzi scheme as a result of the higher returns to be earned.

Ordinarily, a pyramid scheme is a form of investment (often times illegal) in which each paying participant recruits two further participants, with returns being given to early participants using money contributed by later ones. This is the model many of its kind have adopted, just like swissgolden, it is basically in the fashion.

What most MLM operators will never tell you is that your return on investment is highly dependent on the new participants you introduce who also have to invest in the scheme to keep it running. They practically hide the obvious fact from investors who cannot easily discern until they get into the trap.

With many pyramid schemes and Ponzi schemes collapsing, it is very instructive for anyone to tread with caution when dealing with these types of schemes. In the end, investors will always be on the losing end.