Created by FindLaw's team of legal writers and editors | Last reviewed June 20, 2016
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In Oregon, a pyramid scheme is a sales device whereby, for an investment, a person is given the right to recruit additional investors for economic gain who are also granted the same right upon condition of making an investment, thereby perpetuating the chain of persons. This scheme falls under the umbrella of unlawful business or trade practices. It is one of the oldest scams in the book, but for many it can be confusing to understand. This is a quick summary of pyramid and Ponzi scheme laws in Oregon.
This table outlines Oregon's pyramid and Ponzi scheme laws.
| Code Sections | OR. REV. STAT. §§ 636.608(1)(r), 646.609 |
| What’s Prohibited? | Organizing, inducing, or attempting to induce membership in a pyramid scheme. |
| Penalties | A civil action can be brought to recover damages of $200. The court or jury can also award punitive damages and the court can make additional orders or judgments as necessary to restore a victim's interest. The Attorney General or a district attorney may obtain an injunction or restraining order on the violation. If the injunction or restraining order is violated, the prosecuting attorney may seek $25,000 per violation. There may also be additional penalties if the person is also charged and convictted for securities fraud and theft. |
| Who Enforces these Laws? | The Attorney General enforces the prohibition of pyramid schemes in Oregon. |
| Where Can Victims Get Help? | If you think you may be a victim of a pyramid or Ponzi scheme, report it to the Oregon Attorney General: Salem: 503-378-4320 |
The best way to protect yourself from a pyramid or Ponzi scheme is to know the signs and to become informed about the company in which you are planning to invest. It is important to always ask questions and be aware.
Pyramid and Ponzi schemes are designed to be confusing. Unfortunately, the laws that apply to such schemes can also be hard to decipher. If you have been accused of participating in a pyramid or Ponzi scheme and need help, you can contact an Oregon criminal defense attorney. If you would like legal assistance with a consumer fraud matter, you can contact an Oregon consumer protection attorney. You can also visit FindLaw’s sections on Fraud, Consumer Protection, and Oregon Consumer Laws for more articles and information on this topic.
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