How to Save Yourself and Loved Ones from Scams

Reading Time: 20 minutes

Rick had already fallen for a multi-level marketing (MLM) scam before. Somewhere in his garage were stacks and stacks of protein powder, health supplements, and some kind of gel that had the word “power up” in it. He had bought all this stuff because the larger-than-life leaders of the MLM required him to. If he moved these products, and then recruited people underneath him to move their own (or otherwise pay a penalty every month), then he could move up in the “network” and start making some serious cash. If you’re already cringing, you should be. It’s culty MLM fake guru scam BS 101.

After six months of struggling to make real money, Rick finally moved on from that company.

But a few months later, he followed some friends into a new scheme, this one involving exotic financial instruments. He didn’t really understand the details (red flag much?), but he got the bottom line: If you join this program, recruit people under you, and sign your friends and family up as clients, then you too could be rolling in dough.

So he did. And just like his friends and family warned him, he went through the exact same cycle of excitement, struggle, disillusionment, and renewed commitment that he did the last time. He continued to pour more and more money into products and training, and burned bridges with the people in his life by constantly trying to recruit them into his network.

The last I heard, Rick is still involved in that company, stuck in the bleak limbo of every MLM, guru scam, or other shady self-help program. He hasn’t lost enough time and money to realize he’s being taken advantage of, but he’s not bringing in real earnings, either. His team leaders are telling him that he will get there, though, if he just hangs in a little bit longer, works a little bit harder, and brings in just a few more clients. So he does, even though he’s getting nothing of significance in return.

What Rick is getting, however, is hope — a hope that one day, if he just sticks with the program long enough, he’ll hit it big. When that happens, he’ll finally be rich, respected, and free — the three things Rick has always wanted most in life. Which is precisely what makes him such a vulnerable target.

The Danger of Scams

Scams like the one Chase fell into sink their teeth into their victims psychologically, exploiting their deepest needs in order to extract money and allegiance. Meanwhile, they feed these victims with beliefs, promises, and rationalizations so strong that it becomes impossible for friends and family to reason with them. This in turn makes the victims more defensive and wearier of outside criticism, which causes them to double down on their commitment to the program. This, of course, is a pattern that the programs actively encourage.

It’s a tragic and destructive cycle — one that I feel we all need to be more aware of in a world full of people and organizations looking to take advantage of us.

Because at some point or another, you will almost certainly be approached to join a predatory organization. It might be a classic MLM, trying to turn you into one more brick in the pyramid. It might be a mastermind or support group led by a charismatic leader who charges for their wisdom. Or it might be a spiritual community or self-help program that demands increasing amounts of your time, mental energy, and devotion. Whatever the particulars, these groups will always have one ultimate goal: their own enrichment (at your expense).

To avoid them, we have to understand how these groups operate. Even more important, though, we have to understand how human beings become susceptible to them. Because the truth about MLMs, guru scams, large-group awareness training, and otherwise culty organizations is that they are uniquely designed to prey upon a certain kind of person.

So if you want to save someone you know from a scam — or you want to avoid one yourself — then you need to understand the personality traits that make people vulnerable to programs like these.

The Qualities of People Who Fall for Scams

When people write into the show asking how to save someone from a scam, they often ask me how to critique it. “Is a currency-exchange MLM legit?” “Can a time-share scheme actually make my brother wealthy?” “My dad’s new insurance funnel program is definitely shady, right?”

My response to these questions is always the same: You’re asking the wrong question.

The right question is: Why is this person falling for this scheme?

If you want to convince someone they’re part of a scam, you’re not going to succeed by critiquing the logic of the scam itself. The only way to succeed is by pointing out the qualities that make the victim susceptible to the scam in the first place.

Because at the end of the day, all MLMs, guru scams, and LGATs operate on essentially the same principles. Whether it’s protein powder or Costa Rican pesos, life insurance or weight-loss smoothies, spiritual enlightenment, or natural-gas sales, the underlying dynamics of the program are usually the same. The rules and economics are almost irrelevant. What they’re really after is people.

So who are these people? What kind of personality falls for programs like these?

In general, predatory schemes tend to look for targets who embody a few key qualities.

Insecurity.

Insecurity — intellectual, emotional, or financial — is one of the easiest qualities to exploit.

People who feel unstable in their lives, uneasy in the world, and anxious about their own abilities tend to seek out programs that can offer safety, stability, and reassurance. They tend to lack self-confidence, motivation, and experience, and often don’t understand how real businesses are built. They are also less likely to question and criticize a powerful group, even in the face of mounting evidence.

Insecure people also tend to discount their own instincts and analysis, which is why they will double down on the group even when they feel confused, disillusioned, or weirded out. They often don’t have the conviction to honor their gut reactions or to act on their beliefs. Of course, many scams want to wear that conviction down more and more over time, encouraging greater dependence on the groupthink of the organization.

It’s worth noting that “insecure” doesn’t mean “unintelligent.” Scores of smart people fall for scams every day. Even intelligent people can struggle to have conviction in their intellect. That’s actually one of the scarier aspects of a scam: that it can successfully target people who, on paper, are well-equipped to avoid it.

Vanity.

Vanity is another highly exploitable quality, and it’s closely tied with insecurity.

People who are arrogant, egocentric, or overly proud tend to fall prey to scams for a variety of reasons. Sometimes their arrogance alienates them from other people and more legitimate forms of employment. Sometimes their pride makes them avoid the hard work that true employment requires. Sometimes their ego attracts them to promises of power, wealth, and freedom in order to shore up their shaky sense of self.

Ironically, vain people will stick with a scheme even when the scheme makes them look bad — so strong is their need to be (or to be seen to be) successful, desirable, and “right.” It’s no wonder that so many get-rich-quick ads (especially on YouTube) feature people standing in front of Lamborghinis, Instagram models, and Learjets. They’re showing people what they lack by shoving it in their face, using their own vanity to expose and then reinforce their victims’ vanity. Sadly, it works. We all contain a certain degree of narcissism in us as human beings (some of us more than others), and scammers understand how to capitalize on it.

Desperation.

People who become desperate are even more susceptible to shady schemes.

When a program is someone’s last resort, they are far more willing to devote themselves to a group, because the costs of not buying in are simply too high. If they urgently need cash and community, they’re more likely to compromise on their values, follow orders, and overlook their concerns. They look for shortcuts to success, and seek out stories that confirm their belief that these shortcuts are possible. They are also more likely to identify with the desperation of the other people in the group, which makes it even harder to leave.

Paradoxically, desperate people have too little and too much to lose. They are often in dire straits, so they seem to be risking little by throwing everything they have into a group. (Despite the fact that they can least afford to lose money at the time they’re being targeted.) At the same time, admitting that they’ve been conned is too threatening, because the group is all they have. In many cases, it becomes everything.

Hopelessness.

Hopelessness is another dangerous quality, and it’s closely tied to desperation. In fact, desperation is a close cousin to hopelessness, a fellow traveler in the scam target’s psychology.

People who feel hopeless are in dire need of solutions — financial, emotional, social — and they’ll look for those solutions wherever they can find them. Sadly, that’s often in a scheme that has designs on them. Hopeless people usually don’t have much power, and that weakness makes it hard to question or leave the group. So hopelessness both attracts people to scams and, when they don’t manage to cure it, locks them in.

Again, this is ironic, because many MLMs, self-help groups, and guru scams claim to offer hope. But they actually need a lack of hope in their targets to rope them in, and will often perpetuate that hopelessness — while also dangling the carrot of hope — to keep them there.

Connecting Up Scammable Qualities

Of course, all of these qualities are related.

Vain people are often the most insecure, and insecure people tend to cling to their narcissism to protect their fundamental vulnerability. Hopeless people become desperate, and desperation often makes them more hopeless. When you see one of these qualities in a scam victim, you usually find flickers of the others.

But no matter which particular characteristics a scam victim has, all victims share one fundamental quality: the need to believe in the “win.” This is the holy grail that all predatory programs dangle in front of their converts.

The “win” could be financial independence or great wealth. The “win” could be enlightenment or emotional freedom. The “win” could be great power or outsized influence. Or the “win” could be a vague combination of these things, like you find in large group awareness trainings that offer a spiritual experience alongside a financial play.

Like an addict, the devotee to an MLM or guru scam will hunt for this win endlessly. For the vast, vast majority of people, this win will never materialize. In fact, just breaking even eludes most people. 99% of recruits in an MLM, for example, actually lose money, according to the FTC. Wrap your head around that: Only one percent of recruits make any money at all. And the vast, vast majority of those people are merely breaking even or turning a meager profit.

Perversely, this only adds to the allure of the win. The more victory recedes in front of them, the more scam victims tend to double down and keep chasing it. Not just because they have invested too much already, but because they need to continue believing that a win exists. They prefer to live in the fantasy of success in order to escape the unappealing truth of their reality — which is that success is not just around the corner, and that it actually takes a ton of effort. Of course, many targets could escape by chasing a legitimate form of success, but that would require the self-confidence, hard work, and conviction that many serial scam victims lack.

In many ways, that need to believe in the win is the real product that scams are selling. The skin moisturizer, motivational seminar, or currency exchange is just the excuse. When you peel back the layers enough, you always find one core product: the need to believe in the win, which sucks people into the program, then keeps them there.

The Role of Environment in Scam Susceptibility

It’s worth pointing out that people’s susceptibility to these schemes isn’t just a “personal” failure. It’s also a product of the larger environment.

Economic crises, for example — like one we’re in now, and like the one we were in just a decade ago — exacerbate these scammable qualities. Someone struggling under a ton of debt after losing their business can become hopeless and desperate, and turn to an MLM to make a quick buck. Someone whose ego has been bruised from being laid off during a downturn could seek empowerment and validation in a guru scam.

When macroeconomic conditions are difficult, selling protein shakes to your neighbors and recruiting your cousins to sell insurance start to look a lot more attractive. That’s why you often find shady programs thriving in chaotic economies.

In a similar way, the families we’re raised in also play a huge role in our willingness to participate in a scheme.

An insecure person who comes from a family that doesn’t encourage critical thinking is more likely to buy into the mythology of a scam. So is a narcissistic person who grew up in a family that values power and validation. We inherit values, mindsets, and traumas from our families long before we can decide the kind of people we actually want to be. Those qualities then make us susceptible to scams in ways we don’t even realize.

So there are a lot of variables at play here, some of them distal (way out there, like the economy or the policies we live under, which we have little control over) and some of them proximal (closer to home, like personality and mindsets, which we have some more control over).

Being the kind of person who’s susceptible to a scam isn’t always a personal fault. Being the kind of person who avoids a scam, however, is absolutely our personal responsibility.

What to Do If Someone You Know Falls for a Scam

Watching someone you care about fall for a scam is incredibly painful. You feel concerned, you feel angry, but most of all, you feel helpless. How do you even broach the subject? Do you need to understand the scam inside and out in order to break the spell? Or do you just focus on the person you’re trying to save?

Here’s a hard truth: Most people involved in an MLM or guru scam don’t consciously want to be rescued. Partly because they have a strong incentive to believe in the program. Partly because these programs exert enormous influence over their members. And partly because the people who tend to fall for these schemes generally don’t embrace self-reflection and self-education. If they did, they would be far less likely to fall for a scam in the first place. They resist educating themselves so they can continue to believe in that mythical “win.”

Which is why most people you try to save from a scam will not respond well. In most cases, the initial response to your attempt to help will be some version of “f*ck you.”

So given how difficult it is to deprogram someone caught up in a scam, how do you actually break through?

Approach the person on a downward swing.

A person who has joined a scam is usually in the grip of a kind of mania. After wandering through the proverbial woods for a while, struggling to make ends meet and find a community of people, they have finally found an organization that gives them hope. They are on a high, relieved to have found the answer to their problems, and — even if they won’t admit it out loud — deeply afraid of losing it. If they’ve found some early success with the group, their mood is even more elevated, their conviction even stronger.

So it can be hard to approach a scam victim who’s doing “well.” They have too much “evidence” that the group is working, too much “confidence” that the win is real. In fact, the more someone else challenges them, the more likely they are to defend their commitment. After all, how could the group be bad if it’s bringing in money? How could it be dangerous if they’re feeling better than they have in years?

If you’re going to puncture this programming, you have to catch a scam victim when they’ve hit a rough patch. In other words, when they’re losing.

This might take some time, but it will happen, because all scams eventually fail. Only then will the victim be open to questioning the value of their group — when their reasons for buying in start to look shaky.

So if you know someone who’s caught up in an MLM, your best bet is to wait until they’ve spent an extended period losing money, questioning their identity, or slipping into unhappiness. When their referrals dry up, their earnings disappear, their friends drop out and the group abandons them — only then will they be open to seeing the scam for what it is. Similarly, if you know someone who’s caught up in a shady spiritual group, you’ll have much better luck discussing it openly when they’re feeling unhappy, demoralized, and neglected by their guru. These are the moments that create a crack in the target’s armor and open a window into the conversation. Sadly, this window usually only opens after a lot of damage has been done.

This might sound a little manipulative — waiting for just the right moment to poke holes in someone’s belief system — but it’s essential. It’s also a form of respect. Instead of rushing to dismantle someone’s beliefs as soon as you see a problem, you’re allowing them to run through a couple of cycles to see the group for what it is on their own. You’re honoring their autonomy, even if the results are painful. Only then are you stepping in to help them confront the reality of their program — the reality that was obvious to you long before it was obvious to them.

If you don’t approach a victim on a downward swing, your chances of success will be much lower. People on the high of a scam are difficult if not impossible to persuade. (Just like someone who’s in the first flush of a romance or recently hired into a high-profile job.) This is the feeling they’ve been chasing, and they won’t easily let you take it from them. So you have to wait until they hit a wall — emotionally, financially, spiritually, or often all three — to begin a meaningful conversation.

Educate them gently.

Once you’ve found a window into this conversation, your job is to help the other person see the scheme for what it is. This means educating them — gently and respectfully — about the concerns you have about the program and its effect on their life. Your job is not so much to convince them that you are right, but to help them recognize the risks of the program for themselves.

In many cases, like with MLMs, dismantling the details of the scam will be incredibly hard. This, of course, is by design. If the inner workings of a scam were easy to understand, it would be much harder to fall for. But if the mechanics of a foreign currency exchange with a tiered incentive structure are complicated, then victims have a much harder time picking apart what’s actually wrong with the program.

That’s why the best approach is often to avoid the particulars of the scam and focus on its larger effects on the target.

Some helpful questions here include:

• How has the program helped you? How has the program set you back?
• Have you achieved what the group promised?
• Are other people in the group benefitting or struggling in a similar way?
• Is the organization explaining all of this clearly to you?
• Does the program encourage questions or criticism?
• Are you objectively better off now than you were before you joined?

These questions have very clear answers, and the answers are hard to argue with. You can spend years debating whether a beauty products pyramid with a referral bonus waterfall is a valid enterprise (and many brilliant people have). But it won’t take more than a few hours to settle the question of whether that pyramid has actually made the victim better off.

Another important step in saving someone from a scam is explaining the impact of the scam on your relationship.

For many victims, recognizing that their involvement is actually compromising their connections to other people is the alarm bell that wakes them up.

If you were talking to a sibling involved in the foreign currency MLM, for example, you might say, “I’ve noticed that a lot of our conversations focus on you getting me to join the program, and that makes me not want to talk as often. I feel like I’m being manipulated, and then I feel bad for disappointing you.” You might also point out that it’s hard watching your sibling spend more and more money on a program that isn’t generating returns, and that the program feels like a sensitive topic that you have to avoid, which is driving a wedge between you two.

Similarly, if you were trying to help a friend caught up in a health and wellness MLM, you might say, “You know, when you ask me to buy your protein powder, you’re making our hangouts feel like a sales opportunity. And then I’m put in a tough spot because I’m forced to choose between helping you and supporting my family, which makes me feel terrible.”

Again, this approach keeps the focus of the conversation on how a scam is affecting the target’s relationships. No matter how they feel about the program, it’s impossible to deny their friends’ and families’ experiences. At that point, they’ll have to choose between the perceived benefits of the program and the quality of their personal relationships.

That said, if you have an extraordinary understanding of how the scam works, then you might be able to help the target see the skeezy economics and shady practices of the group. But you’ll have to do a ton of homework, you’ll have to know the scam inside and out (as well as or better than its leaders do), and you’ll have to catch the victim when they’re willing to look into the details. (You’ll also have to be dealing with someone who has the capacity to grasp these details, which, as we’ve seen, is not a common quality in scam victims.)

That’s why focusing on the broader impact of the scam — to the person, to you, to their relationships — is so powerful. It cuts through the noise, sidesteps any intellectual justifications, and trumps the dogma that every scam instills in its victims.

Support the person.

Saving someone from a scam is inherently antagonistic. They want to stick with the program, and you want them to leave the program. Your goals are fundamentally at odds. Victims often feel attacked, hostile, and misunderstood — the worst conditions under which to convince them to change their beliefs.

That’s why it’s so important to support the person you’re trying to help. The more you can speak from the same side of the table, the more receptive they’ll be to reconsidering their involvement in the scam.

The first step in supporting the target of a scam is to make it abundantly clear that you are on their team.

Tell the other person that you only want what’s best for them, that you want to see them succeed, and that your relationship with them is important to you. Explain that your agenda in this conversation is not to be right or to make them feel bad, but to make sure that they’re making the best choices for themselves. You might even add that you’re willing to be proven wrong, but that you want to have an honest conversation.

The second step in supporting the other person is empathizing with their situation.

This means taking the time to understand what attracted them to the program in the first place, what they are wanting and needing from life, and how they are feeling — about themselves, the program, and the world — at this moment.

As the other person opens up, listen without judgment. Appreciate that people never join a scam in order to be hurt. They are seeking something very important to them — whether it’s stability, praise, community or purpose — values that every human being, including you, is seeking too.

Validate those needs. Make the person feel heard. This isn’t just a way to pay lip service or butter them up. It’s a way to create the rapport necessary to have a meaningful conversation.

As you come to appreciate their experience, you might begin to notice some of the symptoms of the program. The other person might be talking about how inspired they feel when they attend the yearly convention of their LGAT, then realize how lost they feel when they come home. Or they might talk about how empowering it is to meet their monthly sales quota, only to feel manipulated when they have to fork over more money to stay in the company’s good graces.

These are precisely the observations that you can help the other person recognize as problematic — but only if they feel safe sharing those observations with you first.

As the conversation unfolds, help the person move through their emotional experience.

Support them until they return from the mania of a win or the depression of a loss to a base level of emotion. From there, you can transition into the questions we discussed above, when they’re most likely to be honest and receptive to your ideas. It’s hard for a victim to feel attacked when they first feel understood.

But supporting the other person isn’t just a one-and-done thing. You’ll have to continue to support them through every phase of this process. Once they realize that they’re part of a scam, you’ll have to help them come to terms with the decision to leave. Once they leave, you’ll have to help them transition into their next chapter. You might even have to continue helping them avoid another scam, which can be very tempting to join after leaving a previous one.

In short, approach the scam target the way you yourself would want to be approached. Recognize the qualities in them that are in you too, and how you would need those qualities to be understood and validated in this conversation. And at every step, act in their best interest, approaching the problem not as an antagonist battle for who gets to be “right,” but as a process that leads to the most responsible decision.

What to Do If You’ve Fallen for a Scam

We’ve spent a lot of time talking about how to save someone else from a scam. But if you’re reading this and wondering if you’ve gotten caught up in a scam, then all of the approaches we’ve shared so far will help you, too. You don’t need someone else to come along and save you. You can save yourself — or at least give yourself some more data to work with.

If you’re part of an MLM, guru-led training, or other program, constantly questioning the group is essential and healthy. Even if you’re not in immediate danger — even if the group is ultimately helping you — it’s your responsibility to make sure you’re not getting pulled into something more insidious.

To help you have that conversation with yourself, here are some exercises and principles to explore.

Take stock of your experience.

As you move through the program, carve out some time each week to reflect on your experience. You can do this on your own, with a trusted friend, colleague, or loved one, or with the help of a professional, like a therapist or coach. The important thing is to do this consciously, honestly, and consistently.

Ask yourself all the questions we discussed above — how the group is helping or hurting, what your relationship is like with leadership and other members, whether you are feeling empowered and successful or disillusioned and compromised, and so on. Interrogate yourself as if you were a third party, making sure to be completely honest with your answers. Resist the temptation to only do this exercise when things are going “well.” As we saw, it’s very difficult to accurately assess a group when you’re on a high. You have to check in with yourself during upswings and downswings, successful weeks and unsuccessful weeks, inspiring milestones, and demoralizing milestones. Only then will you have a truly accurate picture.

If you’re doing this alone, I recommend writing your answers down, so you can reflect on them later, and with more objectivity. If you’re doing this with someone else, I would ask them to challenge you on each answer, helping you dig deeper and deeper for the truth. The following week, review your answers from the previous session, and do the exercise again, noticing how your experience is changing over time.

After doing this exercise several times, ask yourself a few key questions.

• At the end of the day, is this group helping or hurting me?
• If a friend were in my shoes, what would I tell them to do?
• Am I better off now than I was before I joined?

You might find that you are in fact part of a scam, and that you need to make some changes. Or you might find that you’re not part of a scam, but have a much greater appreciation for how the group operates. Maybe you’ll change the way you interact with the program. Maybe you’ll help the program evolve to meet your needs. Or maybe you’ll just avoid the temptation to invest too heavily in the program overall.

Whatever the result, this practice will give you greater insight into yourself and more clarity about the group you’ve joined. That said, if you’re part of an MLM or guru scam, then this exercise will always raise some red flags — red flags that you must listen to in order to really capitalize on this practice. At that point, you’ll know that you are a target, and it’s time to make a change.

Ask for help.

Once you’ve discovered that you’re part of a dangerous program, you’ll have to make some big choices — namely, how and when to leave. This can be confusing, intimidating, and sometimes quite difficult to do on your own. Shady programs tend to keep their members locked in, so you might need some help to get out.

Wherever you are in the process, consider finding some support. If you need to work through your thoughts and feelings about the group, then ask a friend, family member, or counselor to spend a few hours talking. If you need to physically leave or financially extricate yourself from the group, then ask a friend or expert to help you transition out. If you need to find a new source of employment or support, then ask for guidance and recommendations from people you trust.

Trying to leave a scam on your own can be tough. It’s one of the reasons many capable victims stick around for so long. Avoid that trap by seeking out the resources you need. You’d be amazed to find how willing people are to help you leave a dangerous situation.

Stay vigilant.

Sadly, many people leave one scam only to fall into another. They eventually realize that a program is taking advantage of them, but they haven’t resolved the underlying issues that led them to seek out that program in the first place. They still feel desperate, hopeless, and insecure (often even more than they did before they joined the scam). They still have a deep need to believe in the “win.” And they’re often worse off financially and emotionally, which makes them even better targets for a scheme that goes by a different name.

So as you transition out of a program, continue checking in with yourself.

Notice if you are being drawn toward people and programs that create a similar dynamic to your previous situation. Go through the introspection process we just talked about, and see if you are dealing with similar thoughts and feelings as you consider a new program. Ask people to give you their perspective before you sign up — especially people who don’t always agree with you. Give yourself as much data as possible before making your next move.

Life Beyond Scams

As you can tell, I’m on something of a crusade to expose scams for what they are and teach people how to avoid them. MLMs, guru scams, LGATs, and other predatory programs are dangerous and insidious. They compromise their members’ relationships, reputations, safety, and sense of self in the pursuit of money and power. Most disturbingly, they do this under the guise of empowerment and enrichment, which makes it hard for people to realize just how badly they are being scammed.

Here’s the good news, though: Most scam victims already know on some level that something isn’t right. They might not be willing to admit it, because their need to believe in the win is greater than their desire to be free. But at a certain point, the reality of the scam becomes impossible to ignore. When somebody consistently loses time, money, happiness, and hope, they begin to suspect that something isn’t adding up. That’s when the crack opens up in the facade.

So there’s usually a window into a productive conversation with a scam victim. The challenge is to open that window slowly and carefully so that you can have a non-threatening conversation about the legitimacy of their program. That conversation requires patience, empathy, and honesty. It also requires a target who is ready and willing to engage with you. But when those variables line up, you can save someone — or yourself — from a truly dangerous situation that millions of people around the world are currently caught up in.

Which is really the greatest gift you can offer a scam victim: a way out.

[Featured photo by Gaurav D Lathiya]