Mansfield, TX asked in Criminal Law and Business Law for Texas

Q: Hello, Is mere participation in a gifting circle (pyramid Scheme) a violation of TX Business and Commerce Code 17.461

I foolishly believed a friend when he said that participating in gifting circles was not illegal. I only paid money into the gifting circle. I never spoke with, promoted, or recruited anyone into this circle. I am being looked at as a possible suspect for promoting a pyramid scheme. The law reads "(c) A person commits an offense if the person contrives, prepares, establishes, operates, advertises, sells, or promotes a pyramid promotional scheme.  An offense under this subsection is a state jail felony." I performed none of these acts. Does participation violate this law?

Thank you

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1 Lawyer Answer
John Cucci Jr.
John Cucci Jr.
Answered
  • Criminal Law Lawyer
  • Houston, TX

A: To start, please do not tell anyone else, what actions you have done, unless they are an attorney. From what you wrote, Technically, you probably did not commit a crime when you joined the pyramid by tendering money for membership. However, if the police are talking to you or have told you that you are a target or a suspect in a pyramid, you need to see a lawyer fast. You have fundamental rights to an attorney and to remain silent from the 5th and 6th Amendments to the US Constitution - exercise them!

The trouble for you, is in section (a) (6). That is where the law throws a wide net to scoop up as many defendants as it can. It is always better to walk away and not argue the law in court. When you talk to police, you may say too much, and a minute later you are in cuffs. See a lawyer for further advice and steer clear from the police and the people in the sceme.

(a) (6) “Pyramid promotional scheme” means a plan or operation by which a person gives consideration for the opportunity to receive compensation that is derived primarily from a person's introduction of other persons to participate in the plan or operation rather than from the sale of a product by a person introduced into the plan or operation.

Chad Zubi agrees with this answer

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