Countries where the Pyramid Scheme is banned

Hybrid MLM Software
3 min readJan 21, 2021

Nowadays we all engaged much on the internet stuff, especially the pandemic lockdown made us all sit home and surf the internet. There are lots of businesses that made their strong roots in the markets exploiting the conditions or taking advantage of that special situation. Being said that most of the companies have sad stories about their growth and most of them already shut down because of the financial crisis and big loss faced on their shares in the market.

2020 took lots of lives and jobs and people were forced to search for alternative ideas to survive the pandemic days. And surprisingly most of them have chosen the multi-level marketing businesses to get their extra income or even chose as their main stream of income. This made plenty of MLM software companies grow their sales and put the roots in the marketing area.

One of the crucial factors that still some people refuse to join the MLM pyramid schemes is because of the existence of plenty of scam MLM businesses that take the user’s money and run away without leaving any traces. Still, there are a lot of such businesses running that look legitimate and even give the promised earning to the user at first but will change those promises later, and one day the members will be in need of finding out the owners to get their invested money back. Though no one can predict the nature of the MLM businesses there are plenty with proven strategies working well as promised and still running at the top.

Is MLM illegal in any country in the world?

Following are some of the countries where the pyramid scheme is banned:


So many years before the pyramid scheme has amounted to half of the whole countries GDP. As a result, so many people have invested in such schemes, and when it collapsed the people who lost their money were striking against the government, and almost 2000 people were killed. The worst impact of Albania was a significant implication for other countries.


Pyramid schemes are illegal in Australia according to Under Australian Consumer Law. There can be fines of up to $220000 for anyone who encourages other people to join the plan and also those who join the plan.


Bahrain ministerial order was issued on Feb- 17 by banning hierarchical and network marketing. Those who make any actions against this ban will be fined up to BD5000 and will be prisoned.


Lakhs of people were frauded by pyramid schemes in Bangladesh such as Destiny 2000, ITCL, etc. As an aftereffect of these activities, they banned all pyramid schemes.


Brazillian police have arrested ten people suspected of doing a cryptocurrency pyramid scheme worth 850 million reals.


In Canada, it is a crime to promote a pyramid scheme or even to participate in one.


The police have arrested 82 people as part of the cracking of $1.51 billion through an online pyramid scheme that involved more than 220,000 investors.

Hong Kong

In Hong Kong, the maximum penalty has been increased from a fine of HK$100000 and prisoned for 3 years to a fine of HK 1000000 and prisoned for seven years.

The United States

The USA had taken action against a Ponzi scheme network tied to cryptocurrency that was claimed to be backed by diamonds.

Other countries are Austria, Belgium, Colombia, Denmark, the Dominican Republic, Estonia, Finland, France, Germany, Hungary, Iceland, India, Indonesia, Iran, the Republic of Ireland, Italy, Japan, Malaysia, Maldives, Mexico, Nepal, the Netherlands, New Zealand, Norway, Peru, Philippines, Poland, Portugal, Romania, Russian Federation, Serbia, South Africa, Singapore, Spain, Sri Lanka, Sweden, Switzerland, Taiwan, Thailand, Turkey, Ukraine, the United Kingdom

The Ponzi Mania — The most Famous pyramid scheme

Bernard Madoff frauded the people who have invested in the company Bernard L. Madoff Investment Securities LLC. He builds a large network of investors and he raised the cash by assembling almost 5000 clients and puts in the account he withdrew from. He never invested the money anywhere and when the financial crisis takes place in 2008 he was not able to sustain the fraud. The SEC (U.S. Securities and Exchange Commission) has estimated the value of around $65 billion was lost from the investors. The controversy has sparked in 2008 and was later known as Ponzi Mania.



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