Pyramid scheme

A pyramid scheme is a fraudulent business model in which participants make money mainly by recruiting new members and taking a share of their entry payments, rather than by selling a genuine product or service to outside customers. The structure depends on an ever-growing chain of new recruits to keep paying earlier members, which makes it mathematically unsustainable: as recruitment inevitably slows, the large majority of participants, especially those who join later, lose the money they put in while only those nearest the top profit. Pyramid schemes are illegal in the United States, Canada, the United Kingdom, Australia and most other developed countries, and are often disguised as multi-level marketing companies in an attempt to evade that prohibition.