‘Stop Now Letter’ issued to promoter of Lion’s Share scheme

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Wellington, January 19, 2021

The Commerce Commission has issued a Stop Now letter to Shelly Cullen, promoter of Lion’s Share, which the Commission believes is likely a pyramid selling scheme.

Scheme under investigation
Pyramid selling schemes are prohibited under the Fair Trading Act 1986. The Commission is currently investigating the Lion’s Share scheme and Ms Cullen’s promotion of it and other potential pyramid selling schemes.
The letter requests Ms Cullen to (a) cease association with the Lion’s Share scheme and any other pyramid scheme (b) cease promoting and recruiting additional participants into the scheme or any other pyramid scheme and (c) remove any content from social media (including Facebook and YouTube) that promotes such schemes.

On receiving the Stop Now letter, Ms Cullen confirmed to the Commission that she has stopped promoting Lion’s Share.
Advice to people

The Commission’s investigation is ongoing. However, because it considers that the Lion’s Share scheme is likely a pyramid scheme, the Commission advises any individuals already involved with the Lion’s Share scheme to cease their involvement and those considering joining the Lion’s Share scheme are advised not to do so.
Preventing harm from pyramid schemes is a current priority for the Commission. The schemes require constant recruitment of new members to buy in and inevitably people lose out financially as recruitment dries up.
About Pyramid Scheme
Pyramid Schemes are illegal under the Fair Trading Act 1986. They can take many forms but have the following essential elements: (a) they offer a financial return based on the payments made by new recruits and (b) the return is dependent primarily on the continued recruitment of new members, not sales of a product or service.

“Stop Now letters are issued where we urgently want conduct to stop that we consider likely to be harmful to the market, consumers or public safety, and which is a likely breach of one of the laws that we enforce,” the Commission said.
It gives the recipient early warning of our concerns and a chance to change their behaviour. It does not signal that we will not also take enforcement action.
If the letter does not achieve a prompt end to the conduct, we may seek a Court injunction, requiring a party to stop what they are doing.

Source: The Commerce Commission, Wellington


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