Just got to know yesterday that my cousin joined Digital Crown Holdings (DCHL). She tried to get me to borrow her RM2k. She didn't mention what she was going to use the money for, just saying that it's an emergency.
I remember hearing my dad said that she tried to borrow money from my dad last time for some MLM stuff, so I persisted in asking her why she need the money. She just kept delaying until I just asked her, which company. When I got to know that it's DCHL, I just exploded.
I mean, of all the money sucking MLM companies around, why did she have to choose the MOST money sucking one?
Who have not heard of the SCAM involving Lampe Berger? It has been hot topics in forums for a very long time. Newspaper came out with stories of students asking money from their parents to invest in this so called company (without publishing the company's name). Most people know that it's a scam. Why can't my cousin see it also? She's not that young, just one year younger than me.
There's no easy money in this world. I do believe that joining this DCHL company you can make money. A very unethical way of making money at the expense of your downline. You join, you pay the money, get more people to join, you get a part of their "joining fees". Isn't that a sign of pyramid scheme?
I'm just hoping that she lied to me about earning 5 digit income and has over 50 downline under her. Cause she tried again today with my dad, asking him to borrow her RM33k. Saying that she will pay him back next month. Her loan (from where?) had been approved. If she needs RM33k, then I sure hope that she's not in yet, cause RM33k is the amount needed for you to get "Count" level (or so I heard). But she did say that she's trying for "Marquis" level. Darn. Just hope that she will wake up soon.
Enough with the rants, what exactly is Lampe Berger?
The Lampe Berger story begins at the close of the nineteenth century. Sometimes considered as a disinfecting home appliance, sometimes as a decorative item, the Lampe Berger comes across the century, resisting both fashion and an increasing competition, while earning the patronage of such distinguished artists as Coco Chanel and Jean Cocteau.
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Lampe BergerLampe Berger is actually a type of fragrance lamp which is used to disinfect rooms and is also a decorative item. It is being sold retail in United States. I have nothing against this product. Okay, it maybe good for you or whatever. What I'm against is the marketing plan of DCHL. I have been reading blogs and notice that people are saying the distributers don't care about the product. They are only selling membership.
Doesn't that make it a pyramid scheme?
A pyramid scheme is a non-sustainable business model that involves the exchange of money primarily for enrolling other people into the scheme, usually without any product or service being delivered.
Most pyramid schemes take advantage of confusion between genuine businesses and complicated but convincing moneymaking scams. The essential idea behind each scam is that the individual makes only one payment, but are promised to somehow receive exponential benefits from other people as a reward. A common example might be an offer that, for a fee, allows the victim to sell the same offer to other people. Each sale includes a fee to the original seller.
Clearly, the fundamental flaw is that there is no end benefit; the money simply travels up the chain, and only the originator (or at best a very few) wins in swindling his followers. Of course, the people in the worst situation are the ones at the bottom of the pyramid: those who subscribed to the plan, but were not able to recruit any followers themselves. To embellish the act, most such scams will have fake referrals, testimonials, and information.
Although pyramid schemes have been declared illegal in many countries, they still persist in various forms, nowadays usually by having a cover business, a product or service.
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WikipediaNow let's see the details in the RZ Corporation Sdn. Bhd. (aka DCHL) plan.

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The__earthincFranchisee
Has personally used the product and achieved an initial personal sales of 18,750PV or RM2,345.
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DCHLTo join at the most basic level would be at "Franchisee". You need 18,750PV to get to this level. With the rate of RM0.125 to 1PV, to get to the lowest level where you can start your "business", you would need RM2343.75. Now, this is just to start the "business". Now you wonder, then why is all those people trying to borrow RM30k when RM2,343.75 would get you started? Let us look at the next two level above "Franchisee".
Baron
1. Has developed and direct sponsored 5 Franchisee within his/her downline group.
2. Has accumulated a personal sales of 90,000PV (RM11,250), but excluding the initial personal sales of 18,750PV or RM2,345
Count
1. Has developed 3 direct-sponsored Barons within his/her group.
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DCHLSo let's count. To get to "Count" level, you need to have 3 "Baron" directly under you. To get a "Baron", you would need to get 5 "Franchisee" under you and personal sales of 90,000PV which is RM11250. Multiply that by 3, you would get RM33,750.
Hmm, so maybe my cousin joined and paid the RM2,343.75 and now she need RM33,750 to get to "Count" level. So that's where the figure RM33K came from. Now I wonder, you need to pull 5 people to join under "Franchisee", then you need to sponsor them to "Baron". Now, where do you get the 5 people from? Now remember, to get "Franchisee" you would need to pay RM2,343.75.
How many
suckers people would join? Do they actually register real people when they "buy Count" or do they just fake some names? If they do fake some names, then there would be an extra of RM11,718.75 (RM2,343.75 * 5) to pay. Confusing. Nevermind about that, let's look at the next level, the "Marquis" (which my cousin said she's challenging).
Marquis
1. Has developed 5 direct-sponsored Counts, and has lodged a Challenge for Marquis with the Company. The challenge takes effect the following month.
2. Has accumulated a total group sales of 3,750,000PV or RM468,750 in 3 months
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DCHLLooking at the levels, doesn't this look like a
Pyramid Scheme? Click on the link to read the explaination.
Duke
1. Has developed five 1st generation sponsored Marquis, and has lodged a Challenge for Duke with the company. The Challenge takes effect the following month.
2. Has accumulated a total group sales of 40,000,000PV or RM5,000,000 in 3 consecutive months
Arch Duke
1. Has developed five 1st generation sponsored Dukes, and has lodged a Challenge for Arch Duke with the company. The Challenge takes effect the following month
2. Has accumulated a total group sales of 400,000,000PV or RM50,000,000 in 3 consecutive months
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DCHLLet's do some calculation. One "Arch Duke" needs 5 "Duke", 1 "Duke" needs 5 "Marquis", 1 "Marquis" needs 5 "Count", 1 "Count" needs 3 "Baron", 1 "Baron" needs 5 "Franchisee". So to get to "Arch Duke" level, you would need 5(D)*5(M)*5(C)*3(B)*5(F) = 1875 people.
From the website, you can find 20 "Duke" in Malaysia. To be a "Duke", you need 5(M)*5(C)*3(B)*5(F) = 375 people. 20 "Duke" means 7500 people joined this company. Keep in mind that this is the minimum amount of people needed. So now, this company has been famous for being a scam, how many new people can you recruit? When they can't recruit people anymore, most people would lose their money (expecially people at the bottom of the chain). I mean, what's the use of having RM30K worth of fragrance lamp?
More info about Pyramid Scheme
DIFFERENCES BETWEEN LEGITIMATE DIRECT SELLING COMPANIES COMPANIES AND PYRAMID SCHEMES
| Legitimate Direct Selling Companies |
| Pyramid Schemes |
| 1. | The start-up fee for all ethical multi-level selling companies is generally low, primarily to cover training materials, sales aids or demonstration kits. |
| Pyramid schemes often disguise high entry fees as part of the price charged for required purchases of training, product inventory etc. Pyramid schemes make virtually all their profits from recruiting. |
| 2. | Such companies sell a wide range of quality products to the general public. The bulk of the sales are on repeat sales form satisfied customers. This is only possible because these companies spend millions on research and development to develop quality products. |
| Pyramid schemes are frequently disguised to appear as legitimate direct selling companies. Such schemes are not interested in marketing these products which are of dubious value. Instead, money is made in typical pyramid fashion, from recruiting, with new distributors being pushed to purchase high cost/large inventory when they sign up. |
| 3. | Many companies have a 100 percent money-back guarantee. Dissatisfied users (and there are relatively few) could exchange the products back for money or for an equivalent amount in other products. |
| Pyramid schemes will not buy back unsold inventory. Such schemes will collapse very quickly if there is this condition for re-purchase of goods. |
| 4. | These companies are interested in long-term business. In every country that they operate, this criterion is important because the companies have an obligation to their distributors who are small businessmen in their own rights. |
| Pyramid schemes are get-rich quick schemes. The nature of the pyramids, in which large numbers of people at the bottom of the pyramid pay money to a few people at the top, clearly explains why the scheme cannot sustain itself for long. |
| 5. | Recognition of achievement is based on efforts. This means that a distributor's income is commensurate with the efforts he/she puts into the business. |
| Position could be purchased. |
| 6. | Established companies depend on selling to customers quality products which offer value for money in order to establish a market. |
| Pyramid schemes are not concerned with repeat sales to users of the products. Profits are made on volume sales to new recruits who buy the products not because they are useful or attractively priced, but because they must buy them to participate in the scheme. As a result, new participants are stuck with products that are way below the market value in relation to the high entry fees paid by them. Should the pyramid scheme collapse, there is no way for the participants to recover their "investments". |
| 7. | These companies build up networks of independent distributors to sell products. |
| Promoters of a pyramid scheme are engaging in fraud, knowingly deceiving participants in the schemes. |
| 8. | They have strict Rules of Conduct which, among other things, forbids its distributors to load up on inventory. |
| Participants in a pyramid scheme have no choice but indulge in inventory loading/high fees to participate. |
| 9. | Distributors sell products and or services. |
| Participation is essentially based on recruiting, not necessarily on the sale of products or services. |
| 10. | Direct selling is a popular method of retailing which is recognised as a lawful and legitimate business in many countries including the U.S. |
| Pyramid schemes have been outlawed throughout the United States and many countries many countries around the world. |
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Direct Selling Association of MalaysiaSo the conclusion is, my cousin is stupid and I hope that she would see her mistake. Curse those people who brought it to Universiti Malaysia Sabah (UMS). Below are some news article about students asking money from their parents.
Troubled by greedy daughter
A GET-RICH-QUICK scheme that lured a 20-year-old girl to invest an initial RM2,000 has got her mother worried, China Press reported.
Known only as Tan, the woman told the daily that her daughter, a college student in Kuala Lumpur, paid the money to join a direct sales company as a member.
She said her daughter was then told by company agents that if she invested another RM30,000, she could easily get RM60,000 in six months.
“My daughter asked me for RM15,000 and said her boyfriend would help raise the other RM15,000,” she told the daily.
She refused to give the money and her nightmare began when her daughter vowed to borrow it from friends.
Her daughter, added Tan, had slackened in her studies after listening to “success stories” of direct sales agents earning large sums.
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The Star'Cash scam' worry for dad
Yesterday was Father's Day but there was no joy for Ho Ka Choon.
In fact, the 45-year-old kereta sapu (unlicensed taxi) driver from Johor Baru has been loosing sleep ever since his undergraduate son started dabbling in get-rich-quick direct selling some time ago.
What worries Ho most is the dubious nature of the direct-selling scheme and that his son has been lying to him and borrowing money from friends and relatives to raise RM30,000 needed to purchase certain products that enable him to recruit more members and get commission from the scheme.
Ho told China Press his 21-year-old son, a second-year student, of Universiti Malaysia Sabah, was an honest and filial son until he was coerced into paying RM2,000 to join the scheme.
Now he is a sweet-talking salesman only dreaming of making it big, he said.
"My son told me that if he recruits five members, he can get 10% of the new recruits' joining fee as commission, and if he then pays up RM30,000 (for products), he will become a senior executive and enjoy up to 50& in commission," said Ho.
"My son wanted to borrow RM10,000 from me to advance his 'career' but I have a feeling that (the direct-selling) is a trap."
He said the scheme sounded too good to be true and believed it could be a scam.
Ho said after he rejected his son's request for RM10,000 and the title of family land to borrow money from a bank, his son turned to relatives and friends for help.
Apart from warning relatives and friends against lending his son money, Ho urged the government to enact a law to bar university students from taking up direct-selling.
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Newspaper clippingFor more details about Lampe Berger Scam, visit:
Lampe Berger Truths
Anti Lampe BergerLampe Berger HelpOne Man’s Perceptions
the__earthincScorkesThe Trevesco BlogDirect Selling Association of Malaysia