Every state has adopted laws regulating MLM companies. Visit this page to look up MLM law in your state.read more »
Chapter 21.--CRIMES AND PUNISHMENTS
PART II.--PROHIBITED CONDUCT
Part 2.--Prohibited Conduct
Article 37.--CRIMES AGAINST PROPERTY
21-3762. Establishing, operating, advertising or promoting a pyramid promotional scheme.
(a) As used in this section, "pyramid promotional scheme" means any plan or operation by which a participant gives consideration for the opportunity to receive compensation which is derived primarily from any person's introduction of other persons into participation in the plan or operation rather than from the sale of goods, services or intangible property by the participant or other persons introduced into the plan or operation.
(b) Establishing, operating, advertising or promoting a pyramid promotional scheme shall be a severity level 9, nonperson felony.
(c) A limitation as to the number of persons who may participate or the presence of additional conditions affecting eligibility for the opportunity to receive compensation under the plan or operation does not change the identity of the scheme as a pyramid promotional scheme nor is it a defense under this section that a participant, on giving consideration, obtains any goods, services or intangible property in addition to the right to receive compensation.
(d) The attorney general, or county attorney or district attorney, or both, may institute criminal action to prosecute this offense.
(e) This section shall be part of and supplemental to the Kansas criminal code.
Chapter 50.--UNFAIR TRADE AND CONSUMER PROTECTION
Article 6.--CONSUMER PROTECTION
50-626. Deceptive acts and practices.
(a) No supplier shall engage in any deceptive act or practice in connection with a consumer transaction.
(b) Deceptive acts and practices include, but are not limited to, the following, each of which is hereby declared to be a violation of this act, whether or not any consumer has in fact been misled:
(1) Representations made knowingly or with reason to know that:
(A) Property or services have sponsorship, approval, accessories, characteristics, ingredients, uses,
(E) the consumer will receive a rebate, discount or other benefit as an inducement for entering into a consumer transaction in return for giving the supplier the names of prospective consumers or otherwise helping the supplier to enter into other consumer transactions, if receipt of benefit is contingent on an event occurring after the consumer enters into the transaction;
Other Pages of Interest
MLM law in 50 states, IRS Publication 911, the MLM Textbook, as well as a comprehensive index of articles on the direct selling industry.read more »
Key Pages to Visit While You're Here
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Starting and Running the Successful MLM Company manual
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