Freidl's crumbling pyramid: an update

Readers of this blog are probably aware that the Lyoness scam is collapsing as we speak. Additional to the rising level of media coverage over the last couple of months, more and more victims are realising that they have been scammed and start demanding refunds, filing suit against Lyoness and its instigators and/or filing complaints with the appropriate authorities, which in return also start investigations and court cases.

Today, it became known that in Sydney (Australia), a group of Lyoness victims has filed a class-action law suit against Lyoness Australia. Earlier, it was also reported that the Australian ACCC has started an investigation of Lyoness, mainly due to Woolworth's announcement that they are not and do not want to be a partner of Lyoness.

Another accelerator of the collapse of any pyramid scheme (and Lyoness in particular) is the surfacing of quantifiable evidence that shows that the company's business model is flawed (to say the least) and that the promises they make are unrealistic and factually untrue.

Yesterday, this blog listed a significant amount of quantitative evidence in the form of income data of members of Lyoness America. Like most numbers reported by this blog (for instance the calculations of the average discounts), they were cited and discussed on several forums. The following excerpt of a forum discussion of the income information published yesterday, should give the readers of this blog an idea of how Lyoness (and its deluded adherents) deals with argued criticism.

In the above screenshot, well-known Lyoness propagator on the German-languaged consumer forum 'Verbraucherrunde' by the name 'seemaster', questions the source of the information (or 'nonsense' as he calls it) - something he and his fellows never do when it concerns Lyoness propaganda.

Unfortunately for 'seemaster', the information published by this blog came straight from the official Lyoness website (pdf) and is part of the official Lyoness America income disclosure statement 2012, which specifies the available income data for all Lyoness America members over 2012. Although not publicly spread, Lyoness has gathered this information itself. According to Lyoness an income disclosure needs to be shown to prospects before they sign up, in order to comply with the relevant regulations in the United States.

When the intelligent Lyoness opponents active on this forum tell to 'seemaster' that the information is the most current data available, coming from his most-trusted source 'Lyoness' itself, 'seemaster' has to employ a different technique. He/she starts posting completely unrelated propaganda in a desperate attempt to a) shelter the information from uninformed readers of the forum (i.e. doubting prospects) and b) to switch to a more favourable discussion in which he/she has more chance of winning.

Particularly the graph 'seemaster' posted is interesting, as that represents exactly the opposite of the point 'seemaster' is trying to make. The graph is not an unknown way of promoting Lyoness; many presentations and Youtube clips constructed by the Lyoness instigators or deluded adherents feature a version of this graph. Although it is supposed to represent the 'incredible growth' of Lyoness as a company in terms of Lyoness memberships, it in fact illustrates the crumbling state in which the Lyoness pyramid scheme is located.

A lot of criticism can be expressed concerning this graph. For instance, it is unclear how high the number of memberships actually is at a certain timepoint and it is of course a preposterous assumption that Lyoness will grow to 5 million memberships in such a short (yet unspecified) period of time. This merely constitutes a deceptive lie designed to convince doubting prospects to sign up for Lyoness as they will have a fair chance at recruiting enough new victims to make an incredible amount of money. Especially the part that after September 2012 (i.e. the forecast part of the graph) the number of memberships suddenly grows with a lot steeper rate than it has ever done in reality, is very interesting.

The reality is that the number of Lyoness memberships has indeed grown over time (quite essential when running a pyramid scheme), but that the most interesting conclusion from analysing the membership growth numbers is that the growth rate has considerably stagnated over time.

Year Members Change


As can be seen from the table, the incredible growth rate of the number of Lyoness members has considerably decreased over the last few years. This probably explains why so few people make any money with Lyoness, as in a pyramid scheme, you need to keep achieving a higher growth rate in order to satisfy the investers that joined earlier. Also, it shows that the 'short-term goal' of achieving 5,000,000 Lyoness members is a ridiculous and preposterous statement, and in fact nothing more than a blatant, deceptive lie.

What is more likely to happen shortly is that the Lyoness scam finally collapses, either because it gets forbidden in host-country Austria, or because the scheme collapses as the capital flows dry up because members are having a hard time recruiting new victims.

Thanks, 'seemaster' (and Lyoness for making the graph) - you have made our point that the Lyoness pyramid is crumbling even clearer!

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