Consumer Protection Division
(208) 334-2424 or
Toll-free at (800) 432-3545
Media Contact: Bob Cooper
Date: January 28, 2003
Be Wary of e–mail Pyramid Schemes
(Boise) - Attorney General Lawrence Wasden today warned Idaho consumers to avoid what appear to be illegal pyramid and chain letter schemes being promoted primarily through e–mail "spam."
"Consumers continue to inquire of my office about e–mail solicitations to participate in various schemes," Attorney General Wasden said. "As described by consumers, it appears that most of the offers are pyramids and/or chain letters. Pyramids and chain letters come with only one guarantee: They will collapse and people will lose money."
A pyramid is a program in which a person makes money primarily by bringing other people into the scheme, rather than from selling goods or services. Idaho law prohibits pyramid schemes and provides that "[A]ny person... who willfully and knowingly promotes, offers, advertises, or grants participation in a chain or pyramid distributor scheme shall be guilty of a felony." The sale of a product does not exempt an otherwise illegal pyramid scheme from liability under Idaho's pyramid statute.
Idaho's pyramid statute also provides that pyramid violations are unfair and deceptive practices in violation of the Idaho Consumer Protection Act. The Attorney General has authority to bring civil lawsuits against violators of the Consumer Protection Act.
Among the factors considered in determining whether a marketing program violates Idaho's pyramid law are:
More information is available on the Consumer Protection section of the Attorney General's web site.
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