Recruiting and transferring salespeople is a pyramid selling crime. MLM refers to the behavior that organizers and developers illegally acquire wealth through developers or require the developed personnel to obtain the qualification to join on the condition of paying a certain fee. The essence of pyramid selling is "Ponzi scheme", that is, the money of the latecomers is distributed to the income of the pioneers.

The filing standards for the crime of organizing and leading pyramid schemes are as follows:

1, which belongs to organizing and leading pyramid schemes;

2. There are more than 30 MLM personnel suspected of organizing and leading, with the level above level 3.

The crime of organizing and leading pyramid selling activities will be sentenced according to the following:

1. Under normal circumstances, he shall be sentenced to fixed-term imprisonment of not more than five years or criminal detention and fined;

2. If the circumstances are serious, he shall be sentenced to fixed-term imprisonment of not less than five years and fined.

Article 2 of the Regulations on Prohibition of MLM The term "MLM" as mentioned in these regulations refers to the behavior that organizers or operators calculate and pay remuneration to the developed personnel on the basis of the number of directly or indirectly developed personnel or sales performance, or require the developed personnel to obtain the qualification to join on the condition of paying a certain fee, seek illegal interests, disrupt economic order and affect social stability.

Article 7 The following acts belong to pyramid selling:

(1) The organizer or operator, through the development of personnel, requires the developed personnel to develop other personnel to join, and calculates and pays remuneration (including material rewards and other economic benefits, the same below) to the developed personnel based on the number of personnel directly or indirectly developed, so as to seek illegal benefits;

(2) The organizer or business operator, through the development personnel, requires the developed personnel to pay the fees or pay the fees in disguised form by subscribing for commodities, etc. , so as to obtain the qualification to join or develop other personnel to join and seek illegal interests;

(3) The organizer or business operator requires the developed personnel to develop other personnel to join, thus forming an online relationship, and calculating and paying online rewards according to the sales performance of offline personnel to seek illegal benefits.