Nouveau Riche Is It A Scam?

Nouveau Riche Is It A Scam?
by Zig Noda

Nouveau Riche is a French term that means “new money”.

It is also the name of a fairly new business opportunity and real estate education program that has been making waves in major cities across America recently, Honolulu being no exception.

Is Nouveau Riche a scam?

I have good friend named Robert R. that went to a NR opportunity meeting on the persistent request of one of his customer/friends. He called me the next day and told me what he witnessed made him sick to his stomach, and that he felt really bad for his friend.

Robert first explained to me that he was amazed that there were close to 300 people in the room.

What shocked him was the approach of what they were doing. This is what he explained to me:

He said that the presentation revolved around a real estate education course that they were trying to sell for over ten thousand dollars. For those that could not come up with the cash they recommended a list of “creative financing” which included using multiple credit cards (read: maxing out credit) and borrowing money from friends.

After the presentation, fast talking sales people went around the room and pre-qualified interested parties and then tried to isolate them, sit them down and go in for the close. He said since he was somewhat dressed and clean shaven and seemed articulate (read: looked like he had money) they went and asked him what he thought. Since he wasn’t “hot to trot” they soon passed him by.

The things that made him sick was that their presentation explained that others could make money by referring others to the Nouveau Riche program…all they had to do was refer 4 other people and they’d make commissions from the 5th referral on (in the home based business industry this is called a 4-up comp plan, most businesses that have this type of compensation utilize a 1-up or 2-up plan instead).

The thing that made him most sick was that they were trying to sell the “program” from $16,000 and up. Yes you read that right SIXTEEN THOUSAND DOLLARS and up. At this point I had to laugh and interjected that “You don’t need pay $16k for a real estate education to learn how to invest in real estate, you can buy a house and use the $16k as a down payment…anything else you can read online or go to the public library and get all the real estate books and info you need for FREE.”

The thing that really bothered him the most was that his friend had already spent $18,000 (EIGHTEEN THOUSAND DOLLARS) hoping she would get a real business opportunity and a chance to make money with Nouveau Riche’s exciting opportunity. She maxed out all her credit in order to do this. He didn’t have the heart to tell her that he thought she had been duped.

“You don’t need pay $16k for a real estate education from Nouveau Riche to learn how to invest in real estate, you can buy a house and use the $16k as a down payment…Anything else you can read online or go to the public library and get all the real estate books and info you need for FREE.”

Fast forward a few weeks and months later…Robert’s friend was considering declaring personal bankruptcy and later was depressed and totally down and out because of the all the money she had spent for something that she thought and hoped might become more.

Who’s to blame here for this situation? Nouveau Riche? They are simply doing what they do, and providing a product/service that people are willing to pay thousands of dollars for. Robert’s friend? Did she really do her “due diligence” and understand what she was getting into? They did not coerce her into forking out her credit card.

The moral and lesson of this: ALWAYS DO DUE DILIGENCE…AND NEVER SPEND MORE MONEY THAN YOU REALLY CAN AFFORD TO… NO MATTER HOW “GREAT” THE OPPORTUNITY MAY SOUND TO YOU.

The other lesson of the story is this: Consider using your hard earned money for a down payment on real estate instead, and if you want a home based business do your due diligence, there are hundreds of other opportunities today that give a fantastic return on investment for much less the cost.

*****

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