Thursday, March 27, 2008

Multilevel Marketing Campaigns Back In Action In Sri Lanka

Several years back a "easy money" making method became popular among Sri Lankans as well as some other Asian countries which was a multilevel marketing strategy based on a gold coin. Multilevel marketing is not a accepted method of investing and therefore central bank of Sri Lanka banned this multilevel marketing scheme. Later another money scam called Seagull Softwares was started to spread in Sri Lanka and later it was also banned and the owners were disappeared with about Rs 200 million of it's customers. As Sri Lankans are very quickly forgetting their past and very eager to earn "easy money" multilevel marketing schemes are becoming popular again in Sri Lanka although they are illegal. Central Bank earlier had a special unit to monitor and investigate these money scams and last year it was also closed. At present same company which sold gold coins is now selling a product called Bio Disk which they say uplifts healthiness and happiness of human life.
Multilevel marketing or network marketing is a marketing strategy where the mother company is on the top and all the other customers are arranged as a pyramid under the mother company. The major difference between a traditional company which sells products and a MLM company is in traditional method consumers just pay the mother company and buy a product and that's it. But in multi level marketing (MLM) initialy customers buy a product from the company by paying the amount and then customers them self become representatives of the company and start selling on behalf of mother company. As a return they will get incentives for each new customer they introduce. This is the most commonly used structure of multi level marketing (MLM) and there are several other structures such as Unilevel, Matrix, Binary and Elevator.
Await more information about this rising multilevel marketing scams (MLM) in Sri Lanka. As a respectable visitor you are highly encouraged to comment on this post, leave your valuable ideas about multilevel marketing and also past experience about MLM if any.


  1. Please post the names of the scams so that people can identify them easily.

    GoldQuest also known as Qatana or Questnet received a lot of publicity so people were warned. It seems that the new operators are keeping a low profile and duping gullible people.

  2. I actually know a group of people who ran the very first scheme in Sri Lanka many years ago.

    They made quite a few millions and then closed down the company.

    They were not prosecuted as at the time, these schemes were not declared illegal by the Central Bank, and they had put a legal declaration at the back of each certificate that specified it (the certificate) had to travel down to 20 levels in order for the customer to make a million bucks.

    Invariably, none of the certificates ever travelled the required distance. Hence the mother company was not legally liable to pay out a single cent!

    Their viewpoint is that they did not do anything wrong by the customers.

    "If they're greedy enough not to read the legalities, it's their own fault"

    Direct quote from one of the guys.

  3. "If they're greedy enough not to read the legalities, it's their own fault"

    True enough but if the scheme was designed to fail, then they were guilty of misrepresentation.

  4. There are different sorts of multilevel marketing campagins in operation and GoldQuest and Seagull were some of them. Accrding to my knowledge, a company called QI which were the owners of GoldQuest scheme are again started their bussiness here in sri lanka. What I have to say is if a customer is required to pay some amount initially for the service or they need to buy a product from the company and in return if u r getting reward for introducing people to the company, all these are called money dont waste your money...

  5. This comment has been removed by a blog administrator.

  6. I know many people that got into these multilevel marketing schemes and lost tons of money. And for some reason these same people keep falling into the same kind of trap over and over. Sad to see.

  7. Excellent information given by you, Its been great to read your article...

  8. multilevel markerting can't stopped ,because there more MLM company in the world ,I Saw more company in america (600 company),India ( 50),Aust ( 150 ),sing,hong-kong

  9. Are all MLM copanies Illegal

  10. Yes i know this marketing is a big trap so many youngers like us falling in that,

    so we will think what can we do for banned theese companies in srilanka,

    Why the central bank is silent on this matter?

    The responcibilties please take action on this please please please

  11. Hello Mr. Auther, Nice article but how ar eyou saying MLM or NEtwork Marketing a scam when most of the countries are welcoming Network Marketing and MLM,
    if you need more details about the countries who are welcoming Network Marketing and MLM please do visit Youtube and search for "Network Marketing or MLM"
    Im a srilankan and im a sucesfull NEtworker, and I have not cheated anyone or have ever put a humen in trouble.
    you should understand the reality behind Network Marketing before you write an article saying Network Marketing is Scam, just based on the Release of Central Bank of Srilanka Network Marketing cannot be a Scam.
    my e-mail ID:

    Please feel free to send me an e-mail i would be more than obliged to give you some details which are proven to the world that Network Marketing is Real business for common people.

    1. Can you pls provide more information for the following email ID?


  12. Dear All,

    I have read your comments on MLM. They give me the common understanding on MLM in SRI LANKA. In other countries like; Middle East, India, Europe, USA, Malaysia & China Network marketing has been even promoted by their goverments.

    Network Marketing is not a pyramid scheme. There are 6 marketing plans (compensation schemes) in this planet. Those are;
    1. Direct Marketing
    2. Unilevel Plan
    3. Breakaway Stair Step
    4. Matrix Plan
    5. Binary Plan (a powerful one)
    6. Hybrid Plan
    7. Pyramid Plan (This plan is Illegal in most of the countries including Sri Lanka, USA & so on)

    Pyramid Plan is just one plan of MLM.
    Yes, it is illegal. Because those pyramid systems cannot sustain for a long time (cannot sustain even 6 months). Therefore the downliners of these schemes will not gain anything rather than loosing since these plans are not sustainable.

    But, other Network Marketing plans are legal. Most of the network marketing companies follows unilevel or binary system. Swedish cosmetic comany called Oriflame is also using a network markerting plan called unilevel plan. Usually Network Marketing companies do not advertise. They pass the advertising, communication & distribution cost among their customers. That is the difference between a normal comany and a Network Marketing company.

    But, People in Sri Lanka do not know about Network Marketing. They think every MLM company is a Pyramid. It is like we are thinking every bank is like Pramuka or Sakvithi. But it is not. Same as that there are MLM companies in Sri Lanka operates within the law.

    If you take an Insurance Company, most of them also follows a network marketing plan called Unilevel Plan. If every plan is a pyramid Insurace companies have to close down their business in Sri lanka,.

    Network marketing is a science and a life art. It is not a system where we can make easy money. If you do network marketing you can help many people to develop themselves. It is not all about money. Network Maketing companies uses power of teams, word of mouth and support of the communities to sell their products & services.

    Please post you comments on my article.


  13. Check the below links, it will give a brief idea about Multi Level Marketing from the specialist

    Please to share The Parable of the Pipeline by author Burke Hedges, how you can use the time-tested secrets of wealth creation

  14. Trumps
    10 Nov, 2010 19:13:33
    Sri Lanka passes gaming law
    Nov 10, 2010 (LBO) - Sri Lanka passed a gaming law which allowed casinos to be set up in areas designated by a minister, legalizing an activity that has anyway operated as clubs with members earlier.

    The bill was labeled by Sri Lanka's main opposition United National Party as a move that will hurt "the cultural, social and religious interests," of the country by the de facto creation of 'redlight' districts.

    Some of Sri Lanka's existing casinos are used as pick-up points by commercial sex workers, especially non-national ones, who also cater to the tourist trade.
    The UNP itself drew criticism from sections of the current ruling coalition for planning a law to legalize 'redlight' districts shortly before it was thrown out of power in 2004.
    The posturing is typical of the widespread hypocrisy and deceptive 'politicking' that is practised on the people by all politicians in the island.
    Sri Lanka is planning to attract several million tourists to the island after a 30-year war ended last year. Tourists who frequent casinos are usually high spenders. Several Asian nations including Malaysia has designated areas where gambling is legal.

    The bill to regulate casinos was passed with a comfortable 114 majority with 33 voting against, a reporter said.
    The move came as police launched a hunt for people appearing in pornographic material amid protests that some of the material was stolen private property and the people involved were being victimized twice.

    Though police got a court order to publish the pictures in the media, many newspapers refused to carry the pictures saying they were not sure of the origins of the material and whether or not they were digitally altered.

  15. but the same network marketing companies were legal in Malaysia USA and other leading countries

  16. great post, i really love this

  17. My name is Nitin from Toronto. I am interested in your writing. Some of your posting are good, I can say, best. Can you please tell me how to subscribe to your blog post online?

  18. pls vist this company is running in Srilanka giving .5% to 1.5% daily , pyout by International debit card if you are interested pls mail me at or call me 00918742932554

  19. Dear All My Friends

    First Of All Janaka I Agree With You. Every MLM Company Is Not Fake. Mostly Country Promote Network Marketing With The Help Of GOVT.In 3rd World Country Our Govt Not Support Us. If Govt Want They Can Stop Scam Company With Govt Policy.
    When You Want To Start Business With Any MLM Company You Must Check 4 Pliers Of Every Company
    1) Product
    2) Business Plan
    3) Profit
    4) Expense

    If You Found Little Bit Fault Then Did Not Work With Those Type Of Company If You Have Any Question Then Must E-mail Me

    Or Also Contact On Cell


  20. so sad about this non educated persons.... hay network marketing, Multy Level Marketing is PHD Vice degree subject,.. you done that degree... but i got some diploma in Network marketing..
    if you want to know Whats the true of Network Marketing,.. i'll teach you..

  21. i have good experience with i like to tell anyone can earn lot of money..the income is depend your working time...then you can design your monthly income according to your necessaries...if you want to earn big money,you should work suggest is this is good chance for change your life 180 degrees....good luck.......

  22. Article of Central Bank about PYRAMID SCHEMES & NETWORK MARKETING PROGRAMS in Sri Lanka ..( for interested people)…/…/_docs/pa/pamphlet/pl_4.pdf

  23. Article of Central Bank about PYRAMID SCHEMES & NETWORK MARKETING PROGRAMS in Sri Lanka ..( for interested people)…/…/_docs/pa/pamphlet/pl_4.pdf

  24. MLM Marketing is a tool which is used by company owners to increase their selling . So they ask people to get involved into marketing. Not to production process. So what would happen to countries economy if majority would attach to this system.they introduce some compensation plan along with some mathematical formulas but when go inside deeply you can understand how it difficult to earn. But few people get good income.But whatever you do the company gets large some of money.Actually this is a not a Network Marketing, this is a criminal Marketing. You works as a slaves unconsciously. The central bank has already identified the negative impact of this network marketing . so this is illegal in Sri Lanka.

  25. i am new to here this marketing type.I wanna to know legal situation of sri lanka and which is illigale companies are banned by government in sri lanka.

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