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Is it legal to develop MLM application?

7:05 pm on Sep 29, 2009 (gmt 0)

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I am from India and would like to know, whether developing a MLM application is legal or not? I am not directly developing the application for the company, but a designer has outsourced this work to me.

Just wanted to confirm, because heard a lot of MLM companies operate illegally and as a programmer do we have any issues when developing such application?

Do you suggest any kind of contract to be signed to be on the safer side?

7:59 pm on Sept 29, 2009 (gmt 0)

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a company that uses multi-level marketing has to make sure commissions are earned only on sales of the company's products or services if they cross state boundaries. If participants are paid primarily from money received from new recruits, or if they are required to buy more product than they are likely to sell, then the company may be a pyramid scheme, which is illegal in most countries
source [en.wikipedia.org]

disclaimer: IANAL (I am not a lawyer!), so any advice I give is merely anecdotal common sense, not actual legal counsel

Your risk is minimal. Legal authorities (if it is deemed illegal) would go after the dude at the top of the pyramid, not the subcontractor who did some designs for the developer who built their web interface.

But beware, if their business is illegal, then you accepting money from them directly or indirectly could result in some unwelcome consequences, if they are ever investigated.

If you have the luxury of saying no to this job, then say no and move on.

And don't get yourself sucked into a MLM scheme - they are usually a financial money pit for the gullible, greedy, and desperate.