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If you're interested in precious metals investment, you might have heard of a company called Emgoldex. But are they legitimate? Their multi-level marketing setup raises eyebrows. Can you actually make a profit by selling their products, or do you have to drag other investors into the mess?

Multi-level marketing businesses are often messy. You can get similar products at much cheaper prices from actual reputable dealers. But let's take a look at what Emgoldex offers, how the company operates, and whether any aspect of their marketing setup is worth it.

About Emgoldex

Emgoldex is a multi-level marketing company that says they sell gold. But instead of focusing on selling the best gold products for the most competitive prices, the company focuses on pulling in investors at all levels. This is a classic pyramid scheme, and most people who get involved don't benefit.

Instead of teaching investors how they can use gold to increase their wealth, Emgoldex tries to recruit investors to sell their product. They're more focused on recruitment than on the actual products they sell -- always a bad sign with a multi-level marketing company.

In the past, EmGoldex was called Global Intergold. The gold that the company sells comes from the Emirates Gold Exchange, and the company is registered in Dubai. As such, the precious metals are not subject to the same scrutiny as those that come from the US or Canadian mints.

How It Works

The setup has all the traditional marks of a pyramid scheme.

To get started, you'll submit an order to the company for whatever gold bars you want. You'll be required to make a minimum investment of at least 7,000 euros. Rather than paying the full price for the gold bars, you'll make an "initial investment."

When you make this initial investment, you will then be given access to a coupon. For those who have just gotten started, the investment might be just 540 euros. You can also get involved at the Accelerated level. This requires an investment of 1,050 euros, but it also has more opportunity for advancement.

The coupon that you're given will be related to the subscription fee necessary for making an Emgoldex website. You'll use this as the base of operations for your online business. In addition, your coupon will let you activate the marketing program for the company.

Activating the marketing program brings you into recruitment. Once you're part of the recruits, you can get payouts from the company. You are not allowed to take cash payouts until you've recruited two other investors.

That's right: You can't make any money unless you recruit two other people into the company, even if you've already paid your own way.

From there, everyone you recruit must also recruit two more people if they want to earn anything. The model relies on there always being a bottom rung of people who have spent too much money, and who are desperately trying to get it back by dragging others into the mess.

Yikes.

Products Offered

Emgoldex claims that they sell gold. Supposedly that's the company's specialty. The company activity is controlled using Seychelles.

Unfortunately, there's no reliable information about the sale of gold. In fact, it seems like the company exists almost exclusively thanks to the useless contributions of investors. They own almost no gold themselves, though they have a small stockpile in the United Arab Emirates.

It's all smoke and mirrors. They want to convince you that they have a product worth selling. But instead of selling that product, you'll just be selling the lie of an investment opportunity.

Most people who make money do so through recruiting other investors. The company wants to swindle people out of their money and then force them to work to swindle other people. You do not have any incentive whatsoever to sell the actual gold. Instead, you're told to make money using the recruitment process.

Every new member goes through a training process. The company owners say that the training will help people learn about the company operations. However, you won't learn anything about the precious metals market. You'll just learn about the right things to say to entice other potential investors.

There are no products worth buying here. There is no program worth investing in. You could use your money on so many better opportunities.

Is Emgoldex a Scam?

Whether the company is a scam depends on whether you believe pyramid schemes are scams. The company does technically do everything it says it does. But it also uses predatory marketing tactics to swindle most investors out of hundreds to thousands of euros.

Pyramid schemes have been banned in several countries because of how predatory they are. In fact, countries like the Philippines have already classified Emgoldex as a scam.

The business model depends upon you dragging other people into the scheme. Even if you sell the gold and don't recruit other members, you'll never make your money back. You are required to entice at least two investors before you'll even be allowed to start taking cash payments.

Most people who invest with this company won't get anything out of it. And if you do, you'll only do so by defrauding others.

Charges were filed against the United States branch of the company, Emgoldec USA. The charges came from the Massachusetts Secretary of State in 2014. They alleged that the company had participated in civil fraud.

For the amount that you're charged to take part in this nonsense, you could invest in actual precious metals. There are plenty of brokerages that will sell you gold without any weird membership costs or resell fees.

Red Flags

The worst red flags have already been outlined. But here are some condensed bullet points:

You can also find multiple different breakdowns of the company's dealings on different scam watch sites. Because the company is based in Dubai, it isn't subject to the same market regulations that US and Canadian companies are. The unregulated setup means that there's no telling what they'll do with your money.

You should always be suspicious of any company that wants you to pay a membership fee to buy their products. That's especially true when it comes to precious metals. The price of precious metals is published and updated on an hourly basis. There are many brokerages that will sell you metals at close to market price.

Precious metals are not a good niche for a multi-level marketing company. But even as precious metals MLMs go, this one is bad. You don't even get a chance to try to sell the gold. You just get a chance to sell recruitment opportunities.

Scam Technicalities

Again, whether the company is a scam depends on how you define a scam. If you want to receive any payments, you will need to recruit two people first. If you leave the company, you will have trouble getting any of your money back.

In addition, the company does have legal documentation showing that it can run. However, it is based in the United Arab Emirates, which has more lax requirements regarding business documentation. Multiple foreign countries have deemed the company a scam.

Emgoldex is not an illegal company. They operate very cleverly in markets throughout the globe. Even though they were hit with civil fraud charges in 2014, that doesn't seem to have stopped them from operating in the US. And though the internet is littered with tales of woe, they're still trying to recruit people.

The company has stretched across three different continents, with presences in North America, Europe, and Asia. They work in the US and Canada, as well as Germany, Finland, the UK, and Italy. Before being deemed a scam by the Philippines, they worked in Hong Kong, Japan, Korea, Singapore, and the Philippines.

One good thing is that the company's reach seems to have diminished over the years. There's too much information out there explaining their pyramid scheme setup. It's hard for people to be defrauded like they were several years ago.

We don't feel that Emgoldex is a very good company, and we believe that there are better companies out there to make your investment with.

===> Click here to see our top 5 recommended companies

Or, continue with Emgoldex...