Pyramid and Ponzi schemes are specifically outlawed in West Virginia. A pyramid scheme is a sales plan or device where a person makes what is essentially a worthless investment that is contingent upon enlisting others who must also invest and enlist other investors. Any return from the so-called investment is primarily derived from the new investors' money rather than from the sale of any goods, services, or property.
In West Virginia, it is a crime to promote a pyramid scheme. The following is a quick summary of West Virginia's pyramid and Ponzi scheme laws.
West Virginia Pyramid and Ponzi Scheme Laws
The following table outlines West Virginia's pyramid and Ponzi scheme laws.
| Code Sections | W. VA. CODE § 47-15-1 et seq. |
| What is Prohibited? | Promoting a pyramid scheme |
| Penalties | Promoting a pyramid scheme is a misdemeanor punishable by up to 6 months in prison and up to $1,000 in fines. The Attorney General or county prosecuting attorney may also seek a restraining order or injunction to stop a pyramid or Ponzi scheme. Additionally, the Attorney General may petition the court for restitution to victims as well as a civil penalty of up to $10,000 per violation of the Pyramid and Promotional Schemes Act. |
| Who Enforces these Laws? | The Attorney General or county prosecuting attorney. |
| Where Can Victims Get Help? | If you think you may be a victim of a pyramid or Ponzi scheme, report it to the West Virginia Attorney General by filing a complaint. You can also contact the West Virginia Attorney General's consumer protection division by contacting the following: Toll free: 1-800-368-8808 Phone: 1-304-558-8986 Fax: 304-558-0184 Mailing address: P.O. Box 1789, Charleston WV 25326 |
West Virginia Pyramid and Ponzi Scheme Laws: Related Resources
Pyramid and Ponzi scheme laws can be confusing. If you have been accused of participating in a pyramid or Ponzi scheme, you can contact a West Virginia criminal defense attorney for help. If you would like legal assistance with a consumer fraud matter, you can contact a West Virginia consumer protection attorney.
You can also visit FindLaw’s sections on Fraud and Consumer Protection for more articles and information on this topic.
