Section 04.02.01.192 - FACTORSIn determining whether a promotion is a pyramid or chain distribution scheme, the following factors, among others, may be considered: (3-31-22)
01.Amount of Fees. Whether a substantial fee is required for entry and continued participation in the promotion. Requirement of a substantial fee suggests that the promotion is an unlawful pyramid or chain distribution scheme. (3-31-22)02.Refund Policies. Whether the purchase of nonrefundable goods is required for entry and continued participation in the promotion or whether a consumer's right to a refund is subject to significant restrictions. Requirement of such purchase or purchases or significant restrictions placed on a consumer's right to obtain a refund suggests that the promotion is an unlawful pyramid or chain distribution scheme. (3-31-22)03.Plan's Primary Focus. Whether the primary focus of the promotion is the opportunity for financial gain through the recruitment of more participants, not the sale of goods or services. Marketing programs based primarily upon the recruitment of other participants suggest that the promotion is an unlawful pyramid or chain distribution scheme. (3-31-22)04.Price of Goods. Whether the goods, if any, for which the promotion allegedly exists to distribute, are inflated in price. An inflated price for the goods suggests that the promotion is an unlawful pyramid or chain distribution scheme. (3-31-22)Idaho Admin. Code r. 04.02.01.192