Michigan Laws 445.2583 – Promotion or participation in pyramid promotional scheme; prohibition; penalties
Current as of: 2023 | Check for updates
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Attorney's Note
Under the Michigan Laws, punishments for crimes depend on the classification. In the case of this section:| Class | Prison | Fine |
|---|---|---|
| F | up to 7 years |
Terms Used In Michigan Laws 445.2583
- Compensation: means a payment of any money, thing of value, or financial benefit conferred in return for inducing an individual to participate in a pyramid promotional scheme. See Michigan Laws 445.2582
- person: may extend and be applied to bodies politic and corporate, as well as to individuals. See Michigan Laws 8.3l
- Promote: means to contrive, prepare, establish, plan, operate, advertise, or otherwise induce or attempt to induce an individual to participate in a pyramid promotional scheme. See Michigan Laws 445.2582
- Pyramid promotional scheme: means any plan or operation in which an individual gives consideration for the opportunity to receive compensation that is derived primarily from recruiting other individuals into the plan or operation rather than from the sale of products or services to ultimate users or from the consumption or use of product or services by ultimate users. See Michigan Laws 445.2582
(1) A person shall not promote or participate in a pyramid promotional scheme. A limitation as to the number of individuals who may participate or the presence of additional conditions affecting eligibility for the opportunity to receive compensation under a plan or operation does not change the identity of the plan or operation as a pyramid promotional scheme.
(2) A person that promotes a pyramid promotional scheme is guilty of a felony punishable by 1 or more of the following:
(a) Imprisonment for not more than 7 years.
(b) A fine of not more than $10,000.00 per violation.
(3) A person that knowingly participates in a pyramid promotional scheme is guilty of a misdemeanor punishable by imprisonment for not more than 90 days or a fine of not more than $1,000.00, or both.