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Committee hears paired bills to protect direct sellers and clarify anti‑pyramid rules
Summary
Representatives Renee Reuter and Holly Jones presented House Bill 1120 and House Bill 1138 to the Commerce Committee as companion measures using model language to distinguish legitimate direct selling from pyramid schemes and to require buyback protections and limits on inventory loading.
Representatives Renee Reuter and Holly Jones told the House Commerce Committee during a joint public hearing that House Bill 1120 and House Bill 1138 adopt model language to protect direct sellers and consumers from pyramid schemes and excessive inventory obligations.
The sponsors said the bills use model legislation provided by the Council of State Governments and the measure has been adopted in 28 states. "What the bill does is it defines the legitimate direct seller," Representative Reuter said. The bills require that compensation be tied to sales of goods or services (not recruitment), define characteristics of unlawful pyramid schemes including incentives that encourage…
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