Attorney General's News Release

December 19, 2000

Judge rules that "dinner party" scheme is an illegal pyramid; sets hearing next week for restitution, penalties

Jefferson City, Mo. — A Clay County circuit judge on Monday (Dec. 18) ruled that a "dinner party" or "gifting network" scheme operating in several parts of Missouri is indeed an illegal pyramid scheme under state law. As part of the order granting summary judgment to Attorney General Jay Nixon, Judge David W. Russell also scheduled a Dec. 27 hearing on the issues of restitution, penalties and costs.

Nixon filed a lawsuit earlier this year against several Kansas City area residents who were involved with the scheme, known as the Women's Empowerment Network (WEN) and also as the Original Dinner Party. Yesterday's judgment against Staci Lynn Baska, Gayla Hiatt, Bonnie Larimore, Susie Smith and Annette Willett also ruled that these defendants violated Missouri law by participating in the illegal scheme.

"The order from the court declaring this to be a pyramid serves as a clear and unambiguous notice that these schemes are illegal, and that anyone who participates in them is breaking the law," Nixon said.

The Attorney General has two other lawsuits pending in Clay County against five other defendants in connection with WEN and a fourth lawsuit pending in St. Louis County against two defendants connected with the Original Dinner Party. Reports of WEN-like pyramid schemes also have come into the Attorney General's Office from areas of eastern Missouri that include the cities of Farmington, Park Hills, Perryville and Potosi, among others.

Nixon said that the operators of WEN called it a "gifting tree" or "gifting network." The scheme often took the form of a four-course dinner party, with participants entering at the "appetizer" level and paying $5,000 to the person at the top, or "dessert," level. Appetizer-level participants move up to the "soup & salad," "entree" and "dessert" levels as more participants are recruited at the lowest level. Nixon said those terms and the number of levels may vary from scheme to scheme.

Inquiries from consumers should be directed to consumer@ago.mo.gov or 1-800-392-8222 (from within Missouri) or 573-751-3321 (outside Missouri).

All media inquiries should be directed to Press Secretary John Fougere.

E-mail      Phone: 573-751-8844         Fax: 573-751-5818