What makes a pyramid plan legal?

Question

I know most pyramid plans are illegal, what makes other plans legal?

Answer 1

It would take too much space for me to explain that in my own words, so here are a number of websites on the subject of pyramid schemes.

http://www.stopspam.org/faqs/mlm_vs_pyr.html

http://www.profitclinic.com/MLM/boobytraps/Index.html

http://www.mlm-thetruth.com/tax_study.htm

http://www.falseprofits.com/FSLegalityPg.html

Answer 2

I learned this a long time ago, so bear with me if I'm slightly off but from what I remember, it's "no enrollment fee" that makes it legal. However, the way around this is the company can charge you for supplies needed to get on board. The supplies are usually a book that costs you $300 bucks along with some audiotape.