Are pyramid schemes illegal?

[Dested]

Im just curious, are they illegal? If they are completly legit, are they illegal?

 

[Rugmuncher]

depends on what country you are in.

 

[Half Evil]

WTF , pyramid scheme, for what, whats going on?? im lost :|

 

[jac006]

Ok... A pyramid scheme is a fraudulent money-making scheme in which people are recruited to make payments to others above them in a hierarchy while expecting to receive payments from people recruited below them. Eventually the number of new recruits fails to sustain the payment structure, and the scheme collapses with most people losing the money they paid in. Hope this helps mate... yeah, it depends where you are...

 

[Half Evil]

yeah thats great.. sounds um.. pretty illeagle to me.. so uh.. dont do it... lol..

 

[root]

I had to dig deep to find this...

posted by me back in february

it's refered to as a pyramid cheme because of the way the user base grows out from beneath you...
this scam has been running since the dawn of time, and people rarely make any money on it,

this explains it better than I could
http://www.zyra.org.uk/pyraschm.htm

this thread goes further to confirm how and why it is a bad idea to enter such pyramid schemes...
and also confims the suspition that pyraids are illegal.
http://www.interleaves.org/~rteeter/pyramid.html

Both Ponzi schemes and pyramids are quite seductive because they may be able to deliver a high rate of return to a few early investors for a short period of time. Yet, both pyramid and Ponzi schemes are illegal because they inevitably must fall apart. No program can recruit new members forever. Every pyramid or Ponzi scheme collapses because it cannot expand beyond the size of the earth's population.
-- U.S. Federal Trade Commission (www.ftc.gov/speeches/other/dvimf16.htm).

 

[macbook]

i wouldnt have thought so, as in theory, you will eventually get something, so i think not! Thats only my opinion so the law is another thing!

 

[technoman2]

if there are thick people to go on them .. then they continue.

 

[David Lindon]

Yes in most countries. Money is not made, it is distrubited.

 

[mr.monger]

man dont be tricking people out of their money and stuff, that is not cool at all.

btw: STEALING IS DISHONORABLE