We have all seen them do the rounds over and over again and for some they prove to be an irresistible magnet. The latest one that reached Dubai late last month was an email that concerned Microsoft.

In order to ensure that Internet Explorer remains the most widely used program, the company was running an e-mail beta test. According to the letter, Microsoft were in a position to track all e-mails for a two week period and were requesting participants to forward the sent e-mail to as many people as possible.

In return for forwarding the e-mail to a third party, Microsoft would 'reward' the initial sender $245 for the first email, $243 for the second and so on.

The e-mail then includes testimony from a person named Mandi claiming that she did not initially believe what could happen but lo and behold, ended up receiving a Microsoft cheque for $24,800!

Although this was a new variation to the usual chain letter, it was still what is known as pyramid selling. Remember that pyramid selling is a fraud - nothing more nothing less - and if you partake in the process, be prepared to lose your investment.

The only winners are the charlatans who dream up the scheme with the sole aim of enriching themselves in a geometric progression via payments made by recruits to such schemes.

This type of pyramid is a scheme in which a recruit pays an entry fee for the chance to receive benefits which will invariably depend on future income derived from that person introducing additional participants into the scheme rather than the sale of a product or service to the consumer.

An example may illustrate the modus operandi of a simple pyramid selling technique. Six persons may develop a plan to make money. All they do is make a list of their names and contact details and each of them forwards it to six of their 'friends'.

The instructions will be simple; all the 'friend' has to do is forward Dh10 to the person whose name is on top of the list, delete his name from the list replacing it at the bottom by his own name. He then forwards the revised list to six of his contacts. These people then forward their Dh10 to the person on top of the list, remove his name and then replace it by their own details.

If all goes to plan and everybody who is contacted plays the game then everybody is a winner. But simple mathematics will show that a nine-level pyramid, which is built when each participant gets six others to join, ends up with over ten million participants!

The diminishing odds of earning any money with such a scheme make it a losing proposition because each time a level rises to the top, a new level must be added to the bottom, each one at least twice as large as the one before.

An infinite number of people is the inevitably weak link in the required "endless chain" of new participants and the supply of willing participants inevitably dries up.

There are variants to the cash pyramid schemes available including gifting clubs, gold matching programmes, binary compensation programmes, the Oxford Savings Club and Equinox.

Female readers should also be made aware of Women Empowering Women even though it does not involve any trading of products or services. All have the same aim - to fleece the unwary, the naïve and the ignorant.

The two reasons why they are still successful are that people are inherently greedy as well as being frightened from missing out on an apparent good deal.

Watch out and remember the TV programme where the compere says to losing contestants: "you are the weakest link - goodbye", but in this case say goodbye to your money instead.

Tim Howe is managing director of Al Ghaith & Co, public accountants, and a financial writer.