| FOR IMMEDIATE RELEASE Date: July 2, 2026 Contact: Ethan Holmes Ethan.Holmes@mt.gov |
| July 2, 2026 FOR IMMEDIATE RELEASE HELENA, Mont. — Montana State Auditor and Commissioner of Securities and Insurance James Brown launched a new, short-term program incentivizing multi-level marketing companies (MLMs) operating unlawfully in the state to file required notices and pay reduced fines. MLMs distribute products or services through a network of participants, often encouraging participants to recruit friends, colleagues, or family members to sell the product or service as well. More than 1,000 MLMs operate in the United States. MLMs transact in a wide variety of goods and services, including cosmetics, home goods, nutrition supplements, pre-paid debit cards, and cryptocurrency. Under the Montana Securities Act, MLMs are required to file an initial and annual notices with the Auditor’s office to lawfully transact business in the state. Although just some 30 MLMs are properly registered with the Auditor’s office, the agency estimates that hundreds of MLMs may be operating in Montana without filing the required notices. MLMs that violate the Montana Securities Act can be fined up to $5,000 per violation and subject to cease-and-desist orders to immediately stop operating in the state. The new program gives unlawfully operating MLMs the chance to come forward and file an initial notice within 30 days of being notified by the Auditor’s office to receive a reduced fine of $1,500. MLMs that did not receive a notice from the agency can receive the reduced fine if they voluntarily come forward before August 31, 2026. Once the amnesty program expires, the Auditor’s office will actively investigate and hold MLMs fully accountable for failing to file the required notices. “My office is tasked with protecting Montana consumers, including by maintaining a transparent business environment. We are giving MLMs operating unlawfully in Montana the opportunity to come into compliance with our state’s regulations, lest they be investigated and held accountable to the fullest extent of the law,” Auditor James Brown said. According to the most recent available data from 2022, approximately 14.6 million people in the United States participated in MLMs, and 7.7% of US adults have participated in at least one MLM. Although many Montana residents may be participating in an MLM that is operating illegally in the state, individual participants have no obligation to take action; it is completely the company’s responsibility to comply with the notice requirements of Montana law. As part of the filing process, MLMs must provide the Auditor’s office with information about how they operate to confirm that: 1) they are not illegal pyramid promotional schemes and 2) they have policies and procedures to protect Montanans who are recruited to participate. Notices for the program are being sent out to MLMs in batches twice weekly. The Auditor’s office will publish the list of MLMs that have properly filed notices or are members of the Direct Selling Association, which is exempt from the filing requirements. The list will be published on the agency’s website, https://csimt.gov/registered_mlms/. “I encourage Montanans who are considering whether to join an MLM to check our list and confirm that the company is operating lawfully in our state. MLMs that fail to file may not have adequate consumer protection measures or may be outright pyramid schemes,” Brown added. ### 840 Helena Avenue, Helena, Montana 59601 (main fax) 406.444.3413 I (securities fax) 406.444.5558 (insurance consumer services fax) 406.444.1980 I (legal fax) 406.444.3499 (phone) 800.332.6148 or 406.444.2040 I (email) csi@mt.gov I (web) www.csimt.gov |
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