NoFollow was originally designed for webmasters, so that they can tell search engines to don’t follow this specific link.
Nofollow attribute is extensively used for fighting comments spam on biogs and forums.

Although, Google has officially declared the death of NoFollow scam, still lots of newbie bloggers and SEO unaware bloggers are following it and suffering huge loss of time, energy and money.You can call it Nonsense scam as it is meaningless now.

What is NoFollow scam ?

First of all, as a blogger you should know about the HTML tag for Nofollow attribute:

Dofollow outbound link – <a href=”http://www.external-link.com/”>Link/Anchor text</a>
Nofollow outbound link – <a href=”http://www.external-link.com/” rel=”nofollow”>Link/Anchor
text</a>

Suppose you have a blogger friend. You want a back-link from his blog by syndicating some blogging content. Similarly he also wants a back-link from your blog by publishing a blog post in return. One fine day you both syndicated your blog content in exchange of back-links. Now you both are happy:) What your poor friend doesn’t know is; you have placed a Nofollow attribute on the outbound link. Your aim was to get a link which passes link juice, but not to provide any link juice in return. Alas ! All the hard work by both of you are in vain. Neither you get the link juice from your friend’s blog nor he.

How NoFollow Scam Died?

In Jun 2009, Google made a major change in its ranking algorithm regarding Nofollow attribute. Google announced that.

NoFollow prevents the passing of link juice to the site receiving the link, but it is lost to the linking site as well.
So, the Nofollow scam is dead now and no longer benefits those who attempt to use it.