~ Global World Trade Owner, three others fined ~
PHILIPSBURG--Detectives infiltrated a sales seminar at Yogesh Centre Thursday night and fined the company involved and three individuals who were found distributing the company's products without the relevant documents.
The fines were issued after the company and the three individuals failed to show the detectives a permit to "conduct business activities in St. Maarten," Prosecutor Hans Mos told The Daily Herald Friday.
The seminar organised by Global World Trade and attended by about 120 people featured what has been described as a multilevel business model that incorporates a fee of US $600 to $1,500 to join. The business model provides for the re-distribution of different packages of jewellery and a tier payment compensation system for acquiring new members, along with profit from everyone else who commits to paying a fee to sell the company's products.
"The police went in last night and established that the group had been operating as a business. To employ anyone you need a permit and proper registration," Moss explained.
"The people executing the seminar in hopes to acquire members to pay to sell their jewellery were advised to cancel their next meeting and that if they do continue to operate without a permit they will be fined again if they don't have proper paperwork. If they do not pay the fine, they will receive a subpoena to appear in court."
This infraction can result in a fine of up to NAf. 90,000 ($50,000). However, Global World Trade was fined $2,500 while each of the three individuals who were selling the packages was fined NAf. 300 (about $166).
Investigations conducted by this newspaper, making use of resources available on the Internet, revealed that Global World Trade's CEO Ramin Mesgalou has registered similar business models in North America under the names Treasure Traders and Woman Empowering Woman.
The available information also indicates that Mesgalou has opened several multilevel marketing campaigns requiring a fee to sell products and acquire a string of people who commit through the initial members' submission all around the world.
According to information available on Canada's Department of Industry Website, Canada's Better Business Borough gave Mesgalou's "Treasure Traders Corporation Ltd" an unsatisfactory rating after sufficient complaints had been submitted to that country's Office of Consumer Affairs by individuals who believed they had been "scammed" or had become victims of fraud.
Multilevel marketing schemes have been referred to as "pyramid schemes" by the United States Federal Trade Commission and the business model is said to be under review by the Securities and Exchange Commission of the United States Federal Government.
A pyramid scheme is a non-sustainable business model that involves promising participants payment, services, products, or ideals primarily for enrolling other people into the scheme without supplying any real product or service.
It is mathematically impossible for everyone to make money in a pyramid scheme. For example, if each recruit needs to find 10 more people to recoup the cost of his or her initial investment, persons at the eighth level of the pyramid would have to recruit a billion people to make back their money. And the next level would need 10 billion, nearly twice the earth's population.
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