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Pyramid Schemes

Pyramid schemes are illegal systems of making money. The distinguishing aspect of pyramid schemes from other forms of consumer fraud is the importance of finding new recruits to participate in the scheme. For instance, a recruiter asks a recruit to give $200 for admission into some business. The new recruit then must enlist more individuals to pay $200 to become part of the business. Participants who recruit others receive a percentage of each of the new members’ earnings, which again increases when those members recruit, and so on. The more individuals that are added onto the pyramid scheme, the more profit.

Pyramid schemes only benefit those at the top of the pyramid, and as a result, most people who participate suffer a financial loss.  Some companies that hold themselves out as legitimate “multi-level marketing companies” (“MLMs”) are actually fraudulent pyramid schemes. 

If you have been involved in such a business enterprise and have lost money, you may be entitled to monetary compensation.  Glancy Prongay & Murray’s consumer protection attorneys have successfully sued pyramid scheme companies and can determine whether or not the MLM you are interested in may actually be a pyramid scheme.

Court Recognition

“And without question, the Court is of the opinion that the value of benefit that’s been conferred to the class is extremely sizable and that this Court is certainly aware that the skill and efficiency of plaintiff’s counsel is what attributed to this settlement, and they are learned securities counsel. The Court is mindful of that, and as a result they were able to sort of weed their way through the complex issues in this case, and also to bring this about — bring about a settlement rather in short order as these matters go. So the Court certainly attributes that to counsel’s skill and efficiency, as well as the ability to work with the adversaries in this matter.”

–Hon. Susan D. Wigention, U.S. District Judge, District of New Jersey

“Class Counsel has conducted the litigation and achieved the Settlement in good faith and with skill, perseverance and diligent advocacy”

— Hon. Donovan W. Frank, U.S. District Judge, District of Minnesota

“The court finds that the Settlement Fund… created by Class Counsel is an exceptional result… The settlement is significantly above the average securities class action settlement when measured as a percentage of losses recovered… The court finds that Class Counsel, particularly Co-Lead Counsel, exerted tremendous effort on behalf of the class in the prosecution of this action… The Court finds that Class Counsel skillfully prosecuted this action, particularly given that this case was unusually complex relative to most securities fraud class actions. ”

–Hon. Dickran M. Tevrizian (Ret.), U.S. District Court Judge, Central District of California

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