Cash Gifting
About Cash Gifting-
"Cash gifting" programs are being promoted like crazy right now. Some of the most popular include:
Residual Cash Forever
The Overnight Cash System (TOCS)
Abundant Living System
Cash Arrives 365 Gifting Program
Magnetic Cash Gifting Program,
Secret Money Factory
Spirit Of Wealth Today (SOW)
TLC2003
Too Damn Easy Ecosov (Ecosov.800)
NOSS123
You'll find there are several, some more well organized than others, and many of these change names and start up again.
They make getting rich sound as easy as opening your mail and receiving a stack of $100 bills. Looking at it, it seems to make sense -- you send somebody a gift to join, then you sign up more people who also send a gift, of which you get to keep a portion. As those people sign up new people, you'll get a small portion of those gifts too. So you'll be sending a little, then getting a lot back.
It sounds tempting, and they SWEAR it's legal. The problem is, it isn't. A video is circulated claiming "cash gifting is legal" and as proof they use a call to the IRS. The IRS... not an attorney, not the FTC, no law-making or law enforcing agency, the IRS, a TAXING authority, which basically says they can do this without tax penalties as long as they stay under $12,000. Please note that the IRS does not make or enforce laws, and is not an authority on what is legal. The FTC, however, is, and has published this article about cash gifting being illegal. Other sites detail the laws regarding cash gifting in more detail than we care to.
Here is the rub: "cash gifting" IS legal. You can gift anybody money for whatever reason. HOWEVER, the SYSTEM under which this is employed is a clear cut pyramid scheme which is completely illegal in the United States. It is, in fact, a business without a product, designed to make people money by recruiting others to send them money, which is exactly what a pyramid scheme is. The bigger ones try to skirt the issues by calling themselves a "club" and not a "business" and try to get by with other loopholes. It is quite clearly a business, though, at least for the ones in charge of the scheme, since they're getting a cut.
We did not join this program, but did sign up to research and ask questions. We thoroughly investigated the system, contacted the FTC, contacted attorneys and viewed countless reports online. While we can't find anybody that's been arrested in regards to this scheme, it is possible that by promoting it, you could be subject to criminal charges. This is probably unlikely, as it as seen as a low-priority problem, and likely the only ones that would be pursued would be the leaders, but still, the ethics of making money illegally is enough to steer us away.
Think about this logically; if 100 people "gift" $100 each, that's a pool of $10,000 to be spread around those 100 people. How that money gets distributed depends on who recruited the most. Those that fail to recruit make nothing, and LOSE money.
The advertisements will show how much you could make -- and indeed you can if you're lucky enough to recruit lots of people. However, in this system there is a finite amount of money moving around, and for somebody to make money somebody HAS TO LOSE MONEY. It is not like there is a product where things are being exchanged -- only $10000 in the above scenario is moved around from place to place. It's like the old shell game, and somebody has to lose. When these pyramids run out of people, they collapse upon themselves. They don't advertise that it is destined to fail, only that some people are making money.
Cash gifting tries to get around the pyramid scheme laws with a couple loopholes and careful wording, but in reality it's just a bunch of small pyramids stacked together. In addition, there is no recourse if you get taken. If you send a $10,000 gift as they suggest, you are relying on others to do the same. You have to include a note saying that your $10,000 is a gift, and you expect nothing in return. They say it makes it a legal gift that way, but actually what it amounts to is you signing a waiver you can't go after them for your money back.
Cost -- 
moderate to very expensive (minimum $100 up to $20,000)
Results --
As I mentioned, after researching this strategy, it became clear it is an illegal activity and we did not pursue it. If you choose to pursue it, you're welcome to try, and you might make good money, but it's the equivalent in our minds to selling drugs or stealing from parking meters -- it can be profitable, but it's illegal and unethical and you might just get what you deserve. We need to be able to sleep at night, so we'll pass.
Analysis -- 
(1/5 stars)
This is as scammy as scams get. I have no doubt some people are making good money doing this. Best of luck to them and their dirty money.
Scam Factor -- 
(5/5 threat level)
Scam scam scam... illegal and unethical. Actually, it might be legal in countries other than the US, but in my country this is just asking for trouble.
Dollars per hour equivalent -- (4/5 income possibility)
$2000. The only time involved is licking postage stamps and promoting. Potential income is very high. Potential jail time is a little too high to make it worth it.
Effort required -- 
(3/5 effort)
This system would become profitable with just a couple of signups.
Experience required -- 
(1/5 experience level)
Anybody with no conscience can do this. If needbe, word of mouth would work. If you wanted, you could promote it to no end as well.