Bangladesh Bank warns against MLM schemes
Bangladesh Bank has cautioned the public against multi-level marketing (MLM) schemes, highlighting their hallmarks—unrealistically high profits and referral-based commissions—as traits of pyramid or Ponzi schemes that often lead to significant financial losses for investors.
The central bank issued the warning on Sunday, March 9.
The statement noted past instances where entities in Bangladesh defrauded customers by collecting deposits or investments illegally, promising exorbitant returns and commissions, or offering products at steep discounts via e-commerce platforms.
“Such fraudulent activities fall under money laundering laws and are punishable offenses,” the bank said, referencing prior legal actions.
It added that collecting deposits without a Bangladesh Bank license violates Section 31(1) of the Bank Companies Act, 1991.
Amid recent reports of similar scams, the central bank said investigations are underway.
“To protect customer interests, we urge the public to avoid transactions with such entities and exercise caution,” the warning said.
It also called on citizens and the media to report any known MLM operations to Bangladesh Bank for further action.
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The irony of this latest warning being, that no regulator, or other law enforcement agent, anywhere in the world has actually examined quantifiable evidence, in the form of income tax payment receipts, proving that any contractor of any so-called 'MLM' company has generated an overall net-income lawfully (after the deduction of all start up and operating costs) by regularly retailing products/services to members of the general public (i.e. persons who were not fellow 'MLM' contractors motivated by a false expectation of future reward) for a profit based entirely on value and demand.
In reality, no one in Bangladesh has ever seen a shred of quantifiable evidence proving that this ridiculous ‘MLM income opportunity’ fairy story can be true.
When American regulators at the Federal Trade Commission have been asked in the most specific of terms, if they have ever seen such evidence, it has been impossible to get any meaningful, let alone the only truthful, answer to this simple question. Another highly revealing question that American regulatory types have obviously shied away from answering, is: what would be your own reaction if a vulnerable individual you care about suddenly underwent a radical personality transformation, and declared that he/she had signed up for a so-called 'MLM income opportunity?'
David Brear (copyright 2025)
