MI HB5726

Prohibits any person from promoting or participating in pyramid promotional schemes, defined as plans where compensation is derived primarily from recruiting participants rather than from product or service sales to end users.

Establishes criminal penalties: promoters face up to 7 years imprisonment and/or fines up to $10,000 per violation; knowingly participating is a misdemeanor punishable by up to 90 days imprisonment and/or fines up to $1,000.

Grants the attorney general authority to issue cease and desist orders, seek injunctions, appoint receivers, and recover civil fines up to $10,000 per violation; allows court awards of attorney fees and costs.

Creates a rebuttable presumption that a plan is not a pyramid scheme if it avoids inventory loading and implements an inventory repurchase program that buys back unsold inventory at 90% of original net cost within 12 months.

Authorizes the attorney general and prosecuting attorneys to issue investigative demands for testimony and documents, enforceable by circuit court order; effective date is September 11, 2018, conditioned on enactment of companion bills HB 5727 and HB 5729.