I love scams. They're often ingenious and involve a good bit of psychology. It's great fun figuring out how they work.
I saw an interesting misuse of freecycle recently which was a scam of sorts. I'll tell you how it worked then introduce my own dubious experiment.
There's a quick explanation of what freecycle is here. But even more quickly it's a way for people to give their stuff away for free locally. You sign up to your local freecycle and start getting emails from people saying "I've got this thing I don't want, do you want to come and collect it?". That sort of thing. It's great, I got an office chair and a blender (turns out you can't blend an office chair). And of course you should offer your stuff too.
A few days ago I got this email though freecycle:
Hi. I have rently gotten a free Imac computer so im going to give away my 1 year old macbook pro, to a good home only. I will try to reply to all mails I recieve. Sincerely.
You rarely get that calibre of stuff on freecycle so I sent him a message saying I'd love to take it off his hands. He did say he'd try to reply to all mails he received (an unusual thing on freecycle).
A couple of days later I got this reply:
Hi, There
Sorry the mac book is gone. Someone came round today to collect it. If you are still looking for one you can get one for free from this website.
I got one 2 weeks ago and yes it was free which is why I just gave away the old one. The way it works is big companies like lovefilm and others companies pay this site to get us to try out their products for free. The website then sends you a gift of your choice with that money. This way everyone wins.
All I did was sign up, completed an offer I did the lovefilm 2weeks free trial offer but there are others you can do. Then it take 14days for the offer to complete. After 14 days I chose which Ipod I wanted but you can chose other gifts for free. Hope this was useful.
Kind Regards... Jay
There's clearly something fishy going on. What's that freebiejeebies link? Is that a scam?
Freebiejeebies
In fact freebiejeebies is a legitimate website as far as I can tell. That's not to say it's an upstanding member or the internet community. Here's how it works...
You register on the site and sign up for one of the affiliate offers (just like Jay described in his email). You then need to persuade a number of you friends to sign up and do the same. The bigger the free gift you want to get the more friends, or anyone really, you need to persuade to sign up and register with an affiliate. Of course, those people would need to get a number or their friends to sign up before they get their free gift. You might have noticed that this is starting to look like a pyramid scheme and they are A Bad Thing. In fact financial pyramid schemes are illegal. What's bad about a pyramid scheme?
Pyramid Schemes
Suppose I set up a scheme that costs £10 to join and that's only open to the UK. I'll persuade as many people to sign up as possible and get a tenner from all of them. I tell them that they'll get £50 back on their investment if they can get 10 people to sign up to the scheme (in fact, it's their duty to get their friends to sign up because they'll get £50 for their £10 investment too). For every £50 pounds I have to give out I'm getting £100 from the friends that the original investors have signed up. So I'm quids in.
Of course, before the original investor's friends get their £50 they have to get 10 of their friends to sign up and so on for ever. What's the catch?
The catch is in the exponentially growing numbers. Suppose I originally persuade 10 people to join the scheme. And suppose they all successfully persuade 10 of their friends to join. How big is this "second generation" of joiners? Easy, it's just 10 x 10 = 100. So now if these 100 people want to get their £50 they each need to persuade another 10 people each to join. That's 100 x 10 = 1,000. For each successive generation of joiners the number grows by a factor of 10.
Here's how that looks:
| Investor generation | Number of investors |
|---|---|
| Zeroth generation (me) | 1 |
| First generation | 10 |
| Second generation | 100 |
| Third generation | 1,000 |
| Forth generation | 10,000 |
How many generations before everyone in the UK has given me £10? For simplicity, let's assume there are 111,111,111 people in the UK. This is a slight exaggeration but that's OK. For each generation you multiply by 10 and add that to the rest to get the total number of investors. That means by the 8th generation everyone in the UK would have invested and paid £10. There are 100 million people in that 8th generation but no one left in the country to persuade to invest so they never see their £50.
So that's the problem. 11,111,111 people see a return on their investment while 100,000,000 don't. The numbers are different for different schemes but in our imagined one there are nearly 10 times the number of people disappointed than happy. It's an over simplified example and in the real world schemes become saturated at various levels before the country wide level, like at the level of a community or even just a friendship group.
Is freebiejeebies any different?
It is, but only in as much as there's no money involved. There are affiliates you can sign up to that will cost you no money. So it's an investment of time instead. By going through the freebiejeebies process you're hoping that enough people will invest their time so you can get a return on your investment knowing that eventually somewhere down the line people will not be seeing a return.
What regular pyramid schemes and sites like freebiejeebies also have in common is that you are cashing in on goodwill and social leverage that you've built up with your friends and acquaintances when you badger them to join for your own selfish benefit.
This is a price that is a bit too high for many to pay.
But in the modern internet connected world goodwill and social leverage can mean something else. In some ways it can be cheaper and shorter lived. For example, simply by coming from freecycle, a scam email can have more social leverage but only until the practice is clamped down upon.
The freecycle freebiejeebies scam
You've probably guessed what Jay's plan was by now. Of course, he hadn't received his free iMac yet because he needed to get people to sign up. So he made up a clever story and put it on freecycle. I'm quite impressed!
Notice the numbers at the end of the freebiejeebies link in his email? If you sign up to the site using that link, Jay gets the referral! That's Jay's number.
My dubious experiment
There's another kind of online social leverage: search engine ranking. If a "good" website links to your site then you'll do better in google because your site will be seen as "good" by association.
This has been used to great effect with freebiejeebies.
If you google freebiejeebies, the number one result isn't the official site but one called freebiejeebie.co.uk (the "s" is missing). That site looks like the real deal and all the links take you to the proper site but with a number tacked onto the end just like in Jay's email! So anyone getting to freebiejeebies.co.uk via freebiejeebie.co.uk counts as a referral for the owners of the slightly shorter domain name! Very clever. I suspect they have more Mac Book Pros than they know what to do with.
I wanted to do the same (as an experiment you understand) but there are no good domain names left to get decent typo traffic. So what I've done is set up a website as a "guide" to getting a free Mac Book Pro from freebiejeebies. So it's a bit different in that I'm not pretending to be the real site.
Here it is:
How to get a free Mac Book Pro from Freebiejeebies.
You can probably see what I mean by dubious now.
Am I evil? Let me know in the comments. And I'll let you know when my Mac Book Pro arrives.
Tags: freebiejeebies, freecycle, maths, scam, Technology
