Legal Question in Consumer Law in Texas
Pyramid scheme question
The legal definitions of pyramid schemes that I have seen so far all basically tell that it is a program in which one is promised to make a great deal of money. What I was wondering is that if a program were set up and did not make any promises, and clearly stated the risks involved, what would its legal status be?
Asked on 9/12/04, 6:40 pm
1 Answer from Attorneys
Peter Bradie
Bradie, Bradie & Bradie
Re: Pyramid scheme question
A pyramid scheme is one where you make money by selling the concept to others below you in the scheme. It is illegal whether you explain the risks or not.
If you are offering an opportunity to make money to the general public, you are subject to the "Blue Sky" laws governing securities. Those laws are both state and federal.
Answered on 9/12/04, 8:09 pm
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