Are Cash Gifting Programs legal?
65The short answer is "NO".
Cash gifting programs are illegal pyramid schemes.
I am limiting my discussion to the USA, however other countries have similar laws.
Enforcement activity can occur at the federal level through the FTC, SEC and U.S. Postal Service and at the state level.
Pyramids promise large profits based primarily on recruiting others and not on profits from retail sales. There are even tests to determine if the product being sold is being used to hide the pyramid scheme.
Many well known network marketing companies have run into trouble with these laws and had to restructure their compensation plans and rules.
In 1979 Amway was found not to be an illegal pyramid scheme by the FTC because their system was based on retail sales to consumers. However the FTC did order Amway to change some of its business practices such as retail price fixing and misrepresenting profit expectations.
Cash gifting programs do not even have a product.
Some argue that cash gifting is legal because of the tax code. They even quote the sections. Those sections are about how to, or not to, tax gifts. The code contemplates legitimate gifts between family members and friends, not an organized gifting program.
If you could rely on the tax code to give legitimacy to cash gifting programs then all pyramids would be legal.
In fact the tax code expects you to claim all of your income regardless if it is from a legal source or not. Just ask Al Capone.
So you cannot look to the tax code to determine if an income activity is legal or not.
Some cash gifting programs are religious based.
They prey on you by using religion. They may even contribute to worthwhile causes, however they are pyramid schemes and those at the top are earning all of the money.
I was just on such a site and I quote them:
"How would you like to receive $800, $2,000, $4,000, $8,000, $16,000, $32,000, and $48,000, or 83,200 Over and Over Again?"
They also state "The blessings flowing through this belief system cannot be measured".
Systems such as these are preying on the generosity of good people like you.
You cannot make money unless you recruit others to join. It is a numbers game that explodes exponentially until it implodes and everyone loses their money.
Cash gifting programs are considered illegal pyramid schemes by federal and state law and it will be just a matter of time before your chosen program will be shut down and the bank accounts frozen.
Is that anyway for you to run a home business?
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OK state the actual law then and stop trying to boost up your own business with hearsay and opinion. use actual facts.
Hey Oscar, every State and the FTC have a illegal pyramid statutes. Tons of case law and tons of fines paid along with jail time.
It is all there if you look :)
It's not illegal to give someone money, and if you know that there is no guarantee that you are going to receive anything in return then there is nothing illegal about it. Cash gifting and mlm, pyramid schemes are totally different. Yes people have to join whatever it is for it to work, but that's the same with a retail store. People have to come to keep them in business. So no, cash gifting is not illegal, but some programs that say they are a cash gifting community can be.
I guess Eric told you pfuller!!! Now top that!
If you really knew how cash gifting worked, you wouldn't have written this post. Maybe some cash gifting programs use illegal techniques, but so do other companies - if a insurance company does something illegal, does that mean that insurance itself is illegal?
@Eric @Sherrie
I agree, it is not illegal to give someone money, however it is illegal per the FTC and State law to participate in illegal pyramid schemes.
And Cash Gifting is an illegal pyramid scheme. All you have to do is search all of the court cases.
So there :)
@Cash Gift Trainer
Cash Gifting by definition is illegal. All you have to do is search case law, it is all there.
Scott Miller Review 2 years ago
Scott Miller the cash gift trainer is a fraud. he post fake pictures on his website with him standing in front of BMW's but he went to a BMW car dealer and took those in the dealer parking lot. he then rigged them with Photoshop to make it look like they are on his front lawn or something. And he had to pay the magazine that he is on the cover of to be on there. Its all deceiving lies and don't ever go in to business with him.