Pyramid Scheme Lawyers

Authored by , LegalMatch Law Library Managing Editor and Attorney at Law

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Pyramid schemes are like many fraudulent systems of making money.  The distinguishing aspect of pyramid schemes is the importance of finding new recruits to participate in the scheme.  For instance, a recruiter asks a recruit to give $200 for admission into some business.  The new recruit then must enlist more individuals to pay $200 to become part of the business.  Therefore, the more individuals that are added onto the pyramid scheme, the more profit. 

Why are Pyramid Schemes Successful?

Pyramid schemes are successful but only to the first few groups of consumers.  Pyramid schemes can't possibly run forever.  At a point, too many people would realize the extent of the scheme and not participate.  When individuals don¿t begin to participate the scheme can't continue to make money because no new recruits are available. 

What Steps Can I Undertake as a Victim?

People should be aware that pyramid schemes are a type of fraud.  Therefore, it's a criminal offense to knowingly participate in a pyramid scheme.  There are steps victims can take, including: 

What Should I Do if I'm Unsure a Pyramid Scheme is Being Employed?
 

Individuals should remember that pyramid schemes can extend to all different types of areas.  Therefore, ask questions about how the proposed business works.  People should think about whether the promise of fast cash and a great return is feasible and possible.  There are countless situations where asking yourself good questions and thinking about what a person is offering can prevent potential fraud. 

Should I Consult an Attorney?

Pyramid schemes are fraud and an attorney can help advise you on a course of action.  A civil suit against pyramid scheme operators would require an attorney experienced in fraud cases.  In addition, an attorney can help you to recover money from pyramid scheme operators. 

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Last Modified: 06-17-2009 09:50 AM PDT

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