Pyramid Scheme
/ˈpɪr.əˌmɪd skiːm/
Definitions
- (n.) A fraudulent business model that recruits members via a promise of payments for enrolling others into the scheme, rather than supplying investments or sale of products.
The company was shut down by regulators for operating a pyramid scheme that deceived thousands.
Forms
- pyramid scheme
- pyramid schemes
Related terms
See also
Commentary
Legally, the key distinction from legitimate multi-level marketing is the emphasis on recruitment commissions over product sales.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.