Tennessee Pulls the Plug on Pyramid Schemes
In the latest round of hits against pyramid schemes and direct selling organizations companies like Herbalife, Tennessee decides that more regulation is the cure.
In a move that is becoming more common these days, the attorney general in Tennessee has passed legislation againgst Pyramid schemes. You can see the story here.
If you didn’t know it already, Pyramid schemes also known as Ponzi Schemes are illegal already. So what makes this legislation in Tennessee different?
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Well according to the article on the Direct Selling News site, it gives law enforcement more leverage in prosecuting these schemers. In fact, a lot of states are updating their Pyramid scheme laws.
Which is a good thing as long as they, meaning the Feds, understand what a true pyramid scheme is and isn’t.
Could it be possible that legitimate companies could be rounded up in a case of mistaken identity by this latest legislation?
I would say that it’s possible. Take the case of Herbalife that’s under a lot of scrutiny right now by the Feds (see story here).
I’m not in Herblife, but I do know they do sell legit products. If you want to argue against their selling price-points and how they do business that’s another thing.
What’s important though, as a person who is looking into being involved in the direct selling/Internet marketing realm, is that you use good ol’ commons sense and not rely on the government to tell what is and what isn’t a pyramid scheme.
Just my two cents…