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I'm a bit surprised it still works. Anyone interested can download the software and join the scheme. They send you html pages of links for you to upload to your site and in exchange you receive thousands of incoming links from other users.
It seems to rely on the fact that Google cannot know who is a member and who is not. It's pretty obvious to me when I check backlinks on a site and I see hundreds of different sites linking in all with folders called /travel09 or /travel08 but I can see Google's problem spotting these sites automatically. The main URL has been wiped from the Google database, but the hundreds of thousands of members still have decent pagerank.
I nearly had a heart attack when one of our staff had joined the scheme and had uploaded the html files to our server. Needless to say the pages are gone now.
I think this scheme is BAD. Has anyone got an idea how the members' pages can be identified?