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Otherwise known as pyramid schemes, network marketing, etc.
A lot of people make a lot of money in MLM, but far more never can make it work. I imagine several folks here are making some money in MLM; speaking for myself, I paid my $49.95 startup fee once and bought the product for three months before I realized it was going nowhere. I cut my losses, got out, and haven't tried MLM since.
Probably the reason Froogle doesn't allow MLM sites to be listed is because it would totally flood the results with the exact same product for the exact same price from thousands or tens of thousands of identical websites (many MLM companies give every "sales rep" their own website, and of course the websites are exactly the same).