Fraud, according to Wikipedia, is a deception made for personal gain or to damage another individual. All these multilevel marketing companies indulge in fraudulent activities. Why they are fraudulent because the method they adopted, i.e., money circulation scheme, is expressly prohibited by the law of the land. They may camouflage their activities with product sales or service providing. But we have to remove the veil and look for the real activity of these companies.
In the case of e.Biz, it has indulged in money circulation scheme in the name of providing the service of computer education. The company first charged exorbitant fee from the members and later induced them to bring in more members with the offer of commission. If they enroll more members they would get more commission. If anybody has any doubt, they can go through the Prize Chits & Money Circulation Schemes (Banning) Act, 1978 and it is available in the older posts of this BLOG.
My learned friend raised a doubt that the Harvard and Stanford universities praised the multilevel marketing schemes stating that they are best form of business. For that matter, astrology is a subject in the Telugu University in Andhra Pradesh. Can we say that it is scientific and can be proved beyond doubt. Let us not be carried away by them. One close look at the business model of Amway revealed in the articles of this BLOG clarifies that the scheme, in fact, is nothing but money circulation scheme benefiting only the company with huge margins. And the common man is the loser buying things at an exorbitant price and caught in the web of inducement of more commission. Anyway, truth is bitter and people who are getting the benefit of the scheme never accept that it is a fraud. Amway indulged in fraud that is to make personal gains and nothing else.