Article 7 of the Regulations on the Prohibition of Pyramid Schemes, the following acts are pyramid schemes:
(1) The organizer or operator, through the development of personnel, requires the development of other people to develop other people to join the development of people to the development of the number of people based on the direct or indirect development of the number of people to calculate and pay remuneration (including material incentives and other economic benefits, the same below), and to make illegal profits. (b) The organizer or operator, through the development of personnel, requires the developed personnel to pay fees or pay fees in the form of subscription of commodities, etc., to obtain the qualification of joining or developing other personnel to join, and profiting illegally;
(c) The organizer or operator, through the development of personnel, requires the developed personnel to develop other personnel to join, forming up and downline relationship, and (C) the organizer or operator through the development of people to develop other people to join the upper and lower lines to form a relationship, and the lower line of sales performance as the basis for calculating and paying the upper line of remuneration, profiting from illegal profits.
Basic features of pyramid schemes:
1. The prices of pyramid schemes are seriously deviated from the actual value of the goods themselves, and some pyramid schemes do not have any use and value at all, and the service projects are purely fictitious;
2. The earnings obtained by the participants do not come from the reasonable profits derived from the sale of the products or services, etc., but are the fees paid by the other people who join the scheme.