Mu' meneen Brothers and Sisters,

As Salaam Aleikum wa Rahmatullahi wa Barakatuh. (May Allah's Peace, Mercy and Blessings be upon all of you)

One of our brothers/sisters has asked this question:

Assalamalikum brother,

I have question regarding MLM business (my video talk),where u have to buy a product and get 2 people enrolled under you and inturn they have to get 2 people enroled under them each.and the commsion keeps on comming to you. pyramid scheme ..is this business halal or Haram.

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Answer:

Pyramid business lawful

In the name of Allah, We praise Him, seek His help and ask for His forgiveness. Whoever Allah guides none can misguide, and whoever He allows to fall astray, none can guide them aright. We bear witness that there is none worthy of worship but Allah Alone, and we bear witness that Muhammad (saws) is His slave-servant and the seal of His Messengers.

Your Question: pyramid scheme ..is this business halal or Haram.

A pyramid scheme is a non-sustainable business model that involves the exchange of money primarily for enrolling other people into the scheme, either without any product or service or an over-priced product being delivered. Pyramid schemes are a form of fraud and declared illegal in many countries including Australia, France, Italy, the UK, and the USA.

A pyramid scheme combines a fake yet seemingly credible business with a simple-to-understand yet sophisticated-sounding money-making formula. The essential idea is that the mark, Mr. X, makes only one payment. To start earning, Mr. X has to recruit others like him who will also make one payment each. Mr. X gets paid out of receipts from those new recruits. They then go on to recruit others. As each new recruit makes a payment, Mr. X gets a cut. He is thus promised exponential benefits as the "business" expands.

To enhance credibility, most such scams are well equipped with fake referrals, testimonials, and information. The flaw is that there is no end benefit. The money simply travels up the chain. Only the originator and very few at the top levels of the pyramid make some commission at the expense of others. The amounts dwindle steeply down the pyramid slopes. Individuals at the bottom of the pyramid always end up with a deficit in this economically non-sustainable business model.

Pyramid businesses are no more than a scam, and all sorts of scams are categorically unlawful in the Light of Shariah Law.

Whatever written of Truth and benefit is only due to Allah’s Assistance and Guidance, and whatever of error is of me alone. Allah Alone Knows Best and He is the Only Source of Strength.

Your brother and well wisher in Islam,

Burhan