1. The crime of organizing and leading pyramid schemes refers to pyramid schemes that, in the name of selling goods or providing services, require participants to obtain membership by paying fees or purchasing goods and services, and organize them into levels in a certain order, with the direct or indirect development of the number of people as the basis for reward or rebate, to induce and coerce participants to continue to develop others to participate, defraud property and disrupt economic and social order. 2. The subject of this crime is the general subject, and any natural person who has reached the legal age of criminal responsibility and has the ability of criminal responsibility can constitute this crime. This crime is mainly aimed at the organizers of pyramid schemes and the active participants who have repeatedly introduced, deceived and coerced others to join pyramid schemes. For the general participants, they will not be investigated. 3. According to the relevant laws and regulations, "companies, enterprises and institutions established by individuals commit crimes by committing illegal and criminal activities, or after the establishment of companies, enterprises and institutions, their main activities are to commit crimes, and they are not treated as unit crimes." Therefore, according to the provisions of judicial interpretation, companies specializing in pyramid selling activities are not treated as unit crimes, and their organizers and main participants are convicted and punished as natural persons.

legal ground

Article 224-1 of the Criminal Law of People's Republic of China (PRC) organizes and leads pyramid selling activities in the name of selling goods and providing services, requiring participants to obtain the qualification to join by paying fees or purchasing goods and services, forming a hierarchy in a certain order, directly or indirectly taking the number of people who have developed as the basis for reward or rebate, inducing or coercing participants to continue to develop others to participate, defrauding property and disrupting economic and social order, shall be sentenced to fixed-term imprisonment of not more than five years. If the circumstances are serious, he shall be sentenced to fixed-term imprisonment of not less than five years and fined.