(1) A person shall not promote, operate or participate in a pyramid selling scheme.
(2) For the purposes of this section, the term “pyramid selling scheme” means a scheme that provides for the supply of goods or a service or both for reward to many participants that constitutes primarily an opportunity to sell an investment opportunity rather than an opportunity to supply goods or a service and is unfair, or is likely to be unfair, to many of the participants in that —
(a) the financial rewards of many of the participants are dependent on the recruitment of additional participants; and
(b) the number of additional participants that must be recruited to produce reasonable rewards to participants is either not attainable, or is not likely to be attained, by many of the participants.
(3) In subsection (2) “participants” means participants in the pyramid selling scheme.
(4) A person who contravenes subsection (1) commits an offence and is liable on summary conviction to a fine not exceeding $5,000 or to imprisonment for a term not exceeding 2 years or to both.
(5) This section is subject to existing financial services legislation and where there is conflict between that legislation and this section, the financial services legislation takes precedence.
(6) The Department shall cooperate and share information with the Financial Services Regulatory Authority established under the Financial Services Regulatory Authority Act in the identification and investigation of pyramid selling scheme activity. (Amended by Act 14 of 2021)