Pyramid scheme collapses
THE Department of Consumer and Employment Protection has taken four operators of the illegal pyramid scheme Abundance to court.
Two of the offenders, Allen and Wendy Cross of Roleystone, appeared in the Perth Court of Petty Sessions for taking part in the promotion of an illegal pyramid scheme and were fined $6,000 with costs of $300.
Colin and Diana Price of Connolly both pleaded not guilty and will be back before the courts in December.
Consumer Protection commissioner Patrick Walker said Abundance was a scheme that gained the trust of others and then took their money.
"Like all pyramids Abundance relies on there being an ever increasing number of participants who, in this particular scheme, each contribute $2,000 in the hope of making $8,000 and potentially more," he said.
"For every person who made $8,000, four others lost $2,000. This is a mathematical certainty with the only gamble being who gets caught."
Mr and Mrs Cross promoted the scheme and recruited others by conducting home presentations and telling potential participants that the scheme was legal.
Those who have lost money to pyramid schemes are able to legally pursue the operators for restitution of their losses.
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