“Everywhere there is a large commission, there is a high probability of a rip-off!” – Charlie Munger

“Everywhere there is a large commission, there is a high probability of a rip-off!” – Charlie Munger    

When there is a sizable commission at stake, there is a greater chance that someone may try to cheat you. It is because the one selling the commission is probably trying to earn a fast profit, which is why they are offering it. They intend to deliver something other than a service or product worth the money they are charging.

This person often employs high-pressure sales methods to persuade others to acquire what they offer. It might include giving an unbeatable price, utilizing scare tactics, or making misleading promises. Do your homework before buying anything from someone giving a massive commission if you are thinking about purchasing from them. There are plenty of reliable companies which offer fair commissions.    

There are various variants of cons, but one thing they always have in common is that they promise a hefty commission for those who fall for them. Swindlers do this because they know that individuals are more prone to fall for their scams when there is the potential for financial gain.  This Nigerian prince scam happens to be among the most popular kinds of scams. In this con, a person claims to be a wealthy Nigerian prince trying to get money out of the country but requires assistance.

They will make the victim believe they will get a substantial portion of the funds in exchange for their service, but the victim will never receive any of it.   Fraudulent investment schemes are another prevalent kind of con. In these schemes, the victim is promised to become wealthy rapidly after investing their money with the perpetrator. They could even attempt to “prove” their validity by showing you bogus documentation or images, but in reality, they only want to take your hard-earned money.  

When starting a business, searching for signs of fraud is essential. If you are new to the business world, you should know that many individuals would attempt to take advantage of you.   Here are some things that you should keep an eye out for:  

1. Those who provide their services at inflated prices are a typical pitfall for newly established companies since they may need to learn what constitutes reasonable pricing for certain services. Before you agree to work with anybody, ensure you’ve done your homework on them, and feel free to look for better offers. 
2. “Get wealthy fast” scams. These deals are often too good to be true, and they typically include some dishonest or criminal action. Please avoid anything that seems too good to be true, and make sure you do your homework before putting any money into anything. 
3. They are acting in an unduly insistent and hostile manner. It’s a warning sign when someone is continuously pressuring you to make a choice or choose a side. Take your time, and don’t let anybody hurry you through the process. 
4. They are withholding some of the facts from you. If the individual trying to force you to make a choice is not providing you with all the data, it is quite probable that they are concealing something from you. Before settling on any action, you must gather all the relevant data. 
5. People who exert pressure on you in an attempt to induce you to make hasty judgments. There are many different types of individuals in this world who will attempt to persuade you to make unwise choices by applying pressure. They might be salespeople, auto dealers, or even members of your own family or acquaintances. However, the fact that they are all attempting to scam you is the one thing they have in common.

 When it comes to doing business, there is no doubt that there is a significant risk of being taken advantage of in some way. It is because wherever there is a large commission involved, there is always at least one person attempting to take advantage of the situation.

Rip-offs are all too often in the business world and may handle many forms. Some of the most typical include misleading advertising, high prices, and failing to deliver on what was promised.

In his famous remark, Charlie Munger cautions readers to avoid doing this.        

Shatabdi

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