Investors warned about AI multilevel marketing schemes
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Multilevel marketing schemes (MLMs) calling for investment in artificial intelligence (AI) robots said to be capable of making money on their own are illegal, authorities have warned.
The Vietnam Competition & Consumer Authority under the Ministry of Industry and Trade has put some AI robot related MLM websites and applications on a warning list, including snowai (snowaiapp.com, snowai.cc, snowai.net) and the inb.network (ai.marketing, and aimarketing).
The websites claim that AI robots will conduct affiliate marketing on the Internet to advertise brands or carry out transactions on virtual and digital currency trading floors.
Depending on investment packages involving AI robot rentals, investors can enjoy different kinds of commissions when orders are placed for branded products or transactions in virtual currencies are made. The income includes commission from investments made by subsequent investors in the multilevel marketing scheme.
If investors pour money into such schemes, they face the risk of losing money because they have to hand in real money but their earnings are in virtual or digital money that are not officially recognized.
The competition authority warned people not to invest in or develop AI robot related multilevel marketing schemes so as to avoid financial and legal losses.
Doing business using the multilevel marketing mode without a license can fetch sentences of up to 5 years in prison under Vietnamese laws, the authority said.
Questions & Answers
Q.What are the potential penalties for operating these illegal multilevel marketing schemes?
What are the potential penalties for operating these illegal multilevel marketing schemes?
Operating a multilevel marketing scheme without a license in Vietnam can result in prison sentences of up to 5 years. Investors also face the risk of losing their money.
Q.How do these AI robot schemes claim to generate income for investors?
How do these AI robot schemes claim to generate income for investors?
The schemes claim AI robots conduct affiliate marketing or virtual currency transactions. Income comes from commissions on product orders or virtual currency trades, and from investments made by subsequent participants in the MLM.
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