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Tuesday, May 10, 2011

Club Asteria – Scam, Illegal Scheme, Or Gateway To Brighter Future As Advertised? Commissions And Rewards Analyzed From A Legal Perspective, by Mr. Ryz on Thursday, July 8th, 2010

Club Asteria, a new internet program gaining popularity in 2010, appears to have drawn a rather diverse international crowd. At first glance the program appears to offer a MLM (Multi-Level Marketing) based commission incentive to its promoters, combined with a unique rewards program using points or award values known as “Asterios.” This leaves many careful prospects wondering if the Club Asteria utilizes a legitimate rewards program or a ponzi scheme, pyramid scam, etc.
First of all, we must examine the value of a Club Asteria membership. Club Asteria does allow individuals to sign up for a free membership and test drive some of the benefits, along with their own back office. Members are encouraged to sign up for Silver memberships at $9.95 per month and Gold Memberships at $19.95 per month. These levels allow members to access more products and services, and further supplies them with additional “Asterio” credits, of which members can earn a profit from at the end of each week.
Some examples of products offered to Club Asteria members include a traffic optimizer, website creation tools, shopping mall with rebates and rewards, and various e-books. Therefore, upgraded (or “paying”) members are receiving products / services for the membership price, which would appear to satisfy the first and most important step in weighing “legitimate programs” vs. “pyramid schemes.”
However, one caveat that should not be overlooked is the true VALUE of the products and services themselves; i.e. do Club Asteria members feel that these products and services are worth the price tag attached for “upgraded” perks, even if the referral incentive did not exist? The United States FTC often uses this as a basic litmus test, whereas the concept of a “fair price” is rarely the biggest concern. Consumers typically determine the true value of such memberships / fees, and therefore, a general consensus of what is “fair” can be somewhat difficult to determine.
Here are two questions that should be asked by prospects and current Club Asteria members:
- Would anyone pay for these products / services if the business opportunity and rewards were not attached?
- Are current members using and accomplishing anything with the products / services they are paying for?
The next crucial examination revolves around the payplan. Club Asteria claims they distribute 75% of their revenues toward commissions and rewards for their business affiliates. The basic explanation on the “Commission” segment of the Club Asteria website implies that 45% of revenues are paid as direct commissions, and another 30% is divided between Gold Members and Silver Members, with a total weekly commision cap of 10%. The amount distributed to each member’s account depends on their accumulation of Asterios.
What exactly is an “Asterio“? Think of it as credit system designed to keep track of individual member’s participation and level in the Club Asteria program. Weekly distributions are then made to Club Asteria members in proportion to their Asterio count. Asterios can be earned as members purchase additional programs and services offered through their affiliates. At first glance, Club Asteria’s explanation appears to account for a sustainable reward system, which shares similarities with MLM models incorporating profit sharing pools and team bonuses.
However, the “Asterio” concept requires a very important warning. The rewards dispersed to Asterio holders must be less or equivalent to all revenues obtained by member purchases in Club Asteria; otherwise, the model would have ponzi scheme characteristics similar to Sophisticated Ponzi schemes, such as the common “Autosurf” concept (though, in this case, not requiring any surfing or web viewing). This does not appear to be the case with Club Asteria; unfortunately, outsiders do not have access to full data regarding the specific allocation of revenues. Therefore, members should simply exercise basic caution and keep an open eye out for any abnormally high rewards that are attained in excess of product / service revenue.
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Given the current information about Club Asteria at this time, I will neither be recommending it or discouraging people from participating in it. I do not see any major red flags that would immediately condemn it as a dangerous scam. The full Club Asteria membership cost is relatively cheap, but the price vs value of the products / services members are urged to purchase remains in question.
Hopefully, we’ll hear some opinions from current Club Asteria members and other industry analysts. As more information is presented in the future, PSA hopes to provide additional updates and articles.

Charles Hopson
skype: cphopson