These scams have been going on before the internet even existed (true story), if you want to know more about Pryamid schemes feel free to read up
Pyramid scheme - Wikipedia, the free encyclopedia
Basically the 1st person thinks up the idea, sells it on to a few 1000 on the internet, makes a mint off of the original sale, the 1000 who buy it then do the same to the point where people near the top made all the money and people at the bottom lose it