Bumble and TikTok users cautioned that Blue Tongue Tradehouse is using tiered marketing as a recruiting tool for its investment program
This is different from pyramid schemes, which are illegal in Australia and do not sell any products, only taking advantage of falsely advertised employment opportunities.
Based on text conversations seen by The Australian Financial Review, members of Blue Tongue Tradehouse used Bumble BFF, a branch of a global dating app that caters to those looking for friendship rather than relationships, to attract new hires.
A 27-year-old woman told the Financial analysis she had paired up with a 31-year-old Melbourne-based woman, Latoya, who only mentioned her involvement with Blue Tongue Tradehouse several days after the pairing.
âUsually I just chat with people on Bumble, but after a day or two she suggested we call,â she said, requesting that her name not be released.
After speaking on the phone twice, Latoya asked the 27-year-old if she would consider being a “mentor” for her growing business.
“Then she brought up Blue Tongue Tradehouse and said it would be a great way for me to make money outside of my job and that she had already made over $ 10,000.”
The woman declined to participate, and Latoya’s Bumble profile was quickly deleted. But the Blue Tongue Tradehouse network extends beyond Bumble and into TikTok, a popular Chinese-owned video sharing app.
On the app, Blue Tongue Tradehouse members view lifestyle content that often includes video footage of their trading screens.
When contacted, a representative for Blue Tongue Tradehouse declined to comment.
ByteDance, the company that owns TikTok, said it has done everything it can to remove content that is trying to financially harm its users.
“When we see content that represents or promotes Ponzi, tiered marketing, or pyramid schemes, we remove it,” said a spokesperson for TikTok. Bumble did not respond to questions in time for publication.
The Australian Securities and Investments Commission has warned social media users against Blue Tongue Tradehouse, saying it appears to exhibit many traits normally associated with a pyramid scheme.
In order for all program participants to make a profit, you need an unlimited number of new members. Finally, someone is missing.
– ASIC spokesperson
âPart of what makes people vulnerable to programs like this is that they go through a way that people typically don’t associate with financial decision-making,â said a spokesperson for the ASIC.
âPeople should be wary of any scheme in which you make money by convincing other people to join and part with their money as well,â the spokesperson said.
âFor everyone in the program to make a profit, you need an unlimited number of new members. Finally, someone is missing something, âthey said.
IM Mastery, the US-based organization that provides the foreign currency training that underpins the sale of software, has been banned from offering financial products and services in Belgium and has been subject to warnings from France and Spain.
“The system offered by International Markets Live has characteristic characteristics of a pyramid scheme,” said a press release from the Financial Services and Markets Authority, the Belgian financial regulator.
The currency trading software that Blue Tongue Tradehouse sells is powered by MetaTrader 4, a white label electronic trading platform that advertises itself as an automated way to trade assets in various markets, with an emphasis on margin trading. .
Margin trading allows someone to borrow their collateral on a trade multiple times, which means they are responsible for any losses, which can far exceed the initial investment.