{"id":376778,"date":"2016-04-11T01:24:12","date_gmt":"2016-04-11T06:24:12","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/state\/utah-law\/utah-pyramid-and-ponzi-schemes-laws.html"},"modified":"2016-06-20T19:51:28","modified_gmt":"2016-06-21T00:51:28","slug":"utah-pyramid-and-ponzi-schemes-laws","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/state\/utah-law\/utah-pyramid-and-ponzi-schemes-laws.html","title":{"rendered":"Utah Pyramid and Ponzi Schemes Laws"},"content":{"rendered":"\n
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Utah Pyramid and Ponzi Schemes Laws<\/h1>\n
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Created by FindLaw’s team<\/a> of legal writers and editors<\/i><\/p>\n\n | Last reviewed\n

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In Utah, pyramid and Ponzi schemes are illegal under the Pyramid Scheme Act<\/a>. A pyramid scheme<\/a> is a sales device or plan where a person makes what is essentially a worthless investment that is contingent upon procuring others who must also invest and procure other investors, thereby perpetuating a chain of people. <\/p>\n

The Beehive State outlaws participating in, organizing, establishing, promoting, or administering a pyramid scheme. Pyramid or Ponzi schemes are also considered deceptive acts or practices prohibited under Utah’s Consumer Sales Practices Act<\/a>. The following is a quick summary of Utah pyramid and Ponzi scheme laws.<\/p>\n

Utah Pyramid and Ponzi Scheme Laws<\/h2>\n

This table outlines pyramid and Ponzi scheme laws in Utah.<\/p>\n\n
Code Sections<\/b><\/td>\n

UTAH CODE ANN. \u00a7\u00a7 76-6a-4<\/a>, 13-11-4<\/a><\/p>\n<\/td>\n<\/tr>

What is Prohibited?<\/b><\/td>\n

Knowingly participating in, organizing, establishing, promoting, or administering a pyramid scheme<\/p>\n<\/td>\n<\/tr>

Penalties<\/b><\/td>\n

Knowingly organizing, establishing, promoting, or administering a pyramid scheme is a third-degree felony<\/a> punishable by up to 5 years in prison and up to $5,000 in fines.<\/p>\n

Knowingly participating in a pyramid scheme and receiving compensation for procuring other investors is a Class B misdemeanor<\/a> punishable by up to 6 months in prison and up to $1,000 in fines.<\/p>\n

An injured party may file an action to recover damages and the court may also award interest, reasonable attorney’s fees, and costs.<\/p>\n

A pyramid or Ponzi scheme is also a deceptive act or practice and under the Consumer Sales Practices Act<\/a>, the Division of Consumer Protection may issue a cease-and-desist order<\/a> and impose up to $2,500 in administrative fines for each violation.<\/p>\n

The Division of Consumer Protection may also seek a restraining order or injunction to stop a pyramid or Ponzi scheme. If the injunction is violated, the court may impose up to $5,000 each day in fines for each violation.<\/p>\n<\/td>\n<\/tr>

Who Enforces these Laws?<\/b><\/td>\nThe Attorney General<\/a> enforces the prohibition of pyramid schemes in Utah.<\/td>\n<\/tr>
Where Can Victims Get Help?<\/b><\/td>\n

If you think you may be a victim of a pyramid or Ponzi scheme, report it to the Attorney General by filing a complaint<\/a>:<\/p>\n

Telephone number: 1-800-244-4636<\/p>\n

Address: 350 North State Street, Suite 230, Salt Lake City, Utah 84114<\/p>\n<\/td>\n<\/tr><\/tbody><\/table>\n

Utah Pyramid and Ponzi Scheme Laws: Related Resources<\/h2>\n

Pyramid and Ponzi scheme laws can be complicated. If you have been accused of participating in a pyramid or Ponzi scheme, you can contact a Utah criminal defense attorney<\/a> for help. If you would like legal assistance with a consumer fraud matter, you can contact a Utah consumer protection attorney<\/a>. You can also visit FindLaw\u2019s sections on Fraud<\/a> and Consumer Protection<\/a> for more articles and information on this topic.<\/p>\n

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