So much for sisterhood. In a country where £3,000 amounts to many people’s life savings, the promised “empowerment” tends more toward “impoverishment.” For eight people to receive the promised £24,000, the setup’s structure requires 64 new investors, who in turn will need 512 new investors, who in turn will need… you get the idea. Still, Women Empowering Women (WEW), which originated in America–where it has since been outlawed in many states–and swept Britain this spring, has drawn in thousands of women, some of whom have lost all their savings or gone into debt to participate. In London pubs and living rooms, mobile-toting women tottering on high heels pore over their heart diagrams. In Glasgow there are tales of women leaving “gifting parties” with bread bags full of cash.

The craze hasn’t merely raided a lot of vulnerable people’s savings. It has also exposed the growing pains of a country shifting from a welfare state to a free- market system. “WEW is really an extreme example of people’s lack of financial education in this country,” says Diane Hay, chief executive of ProShare, a group promoting stock investment. “These days people have to be so much more responsible for looking after their own needs. People have got to start learning about money, investments and pyramid selling so they understand it.” Though pyramid schemes that trade goods and services are banned in Britain, there are no similar restrictions on schemes that work on the generosity–or stupidity–of friends and acquaintances. Britain’s Department of Trade and Industry is desperately searching for a legal loophole to outlaw the scam, hoping it might be banned as a lottery and blocked through gambling legislation. For the time being, the government has had to resort to public warnings. “My message to women who are approached to take part is simple,” says Patricia Hewitt, secretary of state for trade and industry and minister for women. “Don’t do it.”

But thousands have. Since it first made its appearance on the Isle of Wight last summer, WEW has spread like a virus across Britain, with unofficial estimates ranging from 10,000 to hundreds of thousands of women affected. Roughly an eighth of the nation’s 200 local governments have reported signs of the scheme in their areas. On the Isle of Wight, copy-cat pyramids have popped up with names like Men Empowering Men and Friends Empowering Friends. Some new schemes, such as the Community Investment Shop, were started by people who had lost money in WEW but nonetheless kept their faith in the idea. Some women borrowed money from credit unions or ran up their credit cards to make their payments. Under the cruel logic of pyramid schemes, those who had to scrape together funds by borrowing were the last to join, and therefore the most likely to lose.

There’s nothing new about a money scam. What is new, however, is that increasing numbers of Britons have a new interest in investing money. Historically, Britons have been a fiscally conservative lot. While nearly half of all Americans own shares of stock, only a quarter of Britons do. Until the late 1980s, with the deregulation of the British stock market and mass privatization, investments were only for the wealthy. Those who did invest money generally did so through company pension schemes. “If you said at the golf club, ‘I’ve just called my stockbroker,’ people would look at you with envy and respect,” notes Rob McIvor of the Financial Services Authority. But the dot-com boom bolstered the notion that ordinary people, not just millionaires, could be investors. In 1999, according to ProShare, there were 5,000 investment clubs in Britain; last year there were twice as many. The transition to a free-market economy has convinced many Britons that they need to start saving–and investing–for pensions and college educations.

The Blair government and groups like ProShare are trying to educate Britons about how to survive in a world without the state’s safety nets and manage their money in a freer market. The Financial Services Authority, started in 1997 to provide personal-finance lessons, offers a Web site on investing for adults. In addition, its national education program for schoolchildren tries to teach kids to save, plan for the future and learn the difference between a credit card, a debit card and a bus ticket. While the educators are at it, they might include a lesson about distinguishing between real feminism and the fake stuff.