they often go this whole thing one further step (what your wheel sounds like) by offering to let you "buy" your way up to a higher level of the plan by promising to place those new folks under you in the right configuration IF you pay a fee--usually around $2,500 or more. Now imagine how "duplicatable" it is to tell a new person that not only are you... And I forgot to mention
they often go this whole thing one further step (what your wheel sounds like) by offering to let you "buy" your way up to a higher level of the plan by promising to place those new folks under you in the right configuration IF you pay a fee--usually around $2,500 or more. Now imagine how "duplicatable" it is to tell a new person that not only are you... 
But if you mean generically a system whereby people pay and/or agree to place their recruits into an overall system or pattern to build people up compensation levels, this is commonplace. In the company I burned out with, they had a fad going around called the "RHINO System" (I don't even remember what it stood for) and another called the PowerPlay. The ...