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The Royal Scam

Has your loved one been duped by a 'Women's Gifting Circle'?


BE WARNED Sonoma and Marin Counties, especially, have seen a rise in the 'female empowerment' pyramid scheme.
  • BE WARNED Sonoma and Marin Counties, especially, have seen a rise in the 'female empowerment' pyramid scheme.

As "Chloe" headed to a friend's Bay Area home to do some spiritual work, she had no clue she was about to get sucked into a pyramid scheme. "The topic of abundance came up, and my friend touted it as this amazing parallel economy," says Chloe, whose name has been changed for this article. So, last September, she ended up borrowing half of the $5,000 "gift" required to join her friend in a women's "gifting circle." Chloe says she trusted the women involved—they made her feel special, as though she'd been hand-selected to join, and the promise of moving up through different levels where she'd eventually be "gifted" $40,000 didn't hurt either.

Gifting circles have been around for years, but the latest iteration—think The Secret meets Bernie Madoff—is cloaked in the language of abundance, spiritual growth and law of attraction. "This is a group of women who work in pretty high-end spiritual stuff," explains Chloe, who was recruited into a group where the top-level member, known as "dessert" in circle parlance, was from Sebastopol. With rising suspicion upon learning about the complicated backing system, feverish recruitment efforts and progressively stringent (and secret) guidelines, Chloe started doing her own research into the collapse of similar circles in Oregon. That's when she realized that her wisdom "circle" looked suspiciously like a pyramid.

Circles like Chloe's have been going around for years, by different names—Women's Integrity Group, Women Helping Women, Women Empowering Women, Circle of Friends, Wisdom Circles—but all carry a basic (unspoken) premise: Give a "gift" of money and it will come back eightfold. Participants join at the "appetizer" level, moving through "soup and salad" into "entrée" and finally "dessert," wherein $40,000 arrives via new recruits. The circles are often pitched as a means to women's economic empowerment, or as an alternative to standard banking systems and male-driven economic structures. (Considering 24 million women in the United States live below the poverty line, and countless others have little to no savings, investments or retirement funds, alternative economies can be an alluring prospect.)

"It's becoming madness," says "Jordan," a young herbalist who became involved in a Women's Wisdom Circle last February in the Santa Cruz area, who also asked that her real name not be used. Jordan compares the profligate growth of circle culture among her Burning Man-loving friends to a virus, one that quickly reached a saturation point. "There was nobody left to invite," she recalls.

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