Chain of Happiness (Pyramid/Ponzi Scheme)

Wealth sometimes arrives with hope: in a friendly card offering, in an investment proposal presented with a sincere smile, or in the whispered words of a well-dressed person: “a chance just for you.” Yet this hope is often built not on one’s own feet but on the shoulders of others. It is for this reason that the chain of happiness is not merely a financial trap but also a system of illusions targeting the vulnerable points of the human spirit.

The term “chain of happiness” is commonly used in public discourse to describe systems promising rapid returns but lacking sustainability. Technically, it refers to two structures: Ponzi schemes and pyramid structures. In a Ponzi scheme, payments to existing investors are funded by money from new investors. In a pyramid structure, participants earn profits by recruiting new members into the system. Both systems are doomed to collapse when the inflow of new resources declines.

Although the historical origins of these structures extend back to the 19th century, it was Charles Ponzi’s application in the 1920s that gave the scheme its name and notoriety. Ponzi defrauded thousands of Americans by promising high returns through the buying and selling of postage stamps. When the system collapsed, the remaining value amounted to only a few dollars’ worth of stamps. More recently, Bernard Madoff’s $65 billion investment fraud has laid bare how such structures can wreak havoc in the modern world.

In Türkiye, such structures have been encountered since the 1990s, notably the “Titan” system, which victimized thousands of people. As a legal measure against such practices, Article 80 of Law No. 6502 on the Protection of Consumers explicitly defines and prohibits pyramid sales systems. According to the law, a system is illegal if the profits of participants depend on other individuals joining the system in the same manner. The establishment, promotion, and encouragement of such systems are forbidden.

Participation in a chain of happiness cannot be explained solely by ignorance. People sometimes place trust without questioning, accept the decisions of those around them as correct, and sideline rational thought in the pursuit of high returns. In systems based largely on social trust, joining through the recommendation of an acquaintance or a respected figure in society gives individuals an added sense of security. At this point, the individual’s critical questioning reflex is disabled.

Research indicates that environmental pressures and emotional manipulation play as significant a role as the desire for sudden wealth in leading individuals to fall victim to such systems. Moreover, those who perpetrate fraud often do not view themselves as evil. Such individuals describe their actions as “temporary,” “what everyone does,” or “harmless.” They justify themselves by attributing blame to external circumstances.

Structures like the chain of happiness cause not only financial but also social damage by undermining public trust. These systems erode individuals’ confidence in the financial system. Therefore, it is not only the responsibility of regulatory authorities but also of every individual to enhance financial literacy and prefer investments based on transparency. Ultimately, joining a chain of happiness may be a mistake, but continuing to participate in it is a choice.