Auckland-based Net Guard (New Zealand) has following a Commerce Commission investigation.
The commission had received complaints that Net Guard, formerly known as World4Vision, was operating a sophisticated pyramid scheme in breach of section 24 of the Fair Trading Act.
Net Guard described itself on its website as a "technology-driven international membership organisation
focused on becoming a market leader in the design and development of wireless internet-enabled tracking and location systems".
The commission began investigating Net Guard last month after receiving more than 30 complaints about the business.
Commission chairman John Belgrave said Malcolm Stockdale and Stuart Baldwin, two of the people who set up the scheme in New Zealand, were linked to the Alpha Club - an alleged pyramid scheme the commission is taking civil action against.
"The commission found that more than 60 people had joined Net Guard and that the business had already generated up to half a million dollars in membership fees," Mr Belgrave said.
Net Guard recruited "agents" through invitation-only presentations around Auckland.
Agents paid $6800 to become members and received $1200 for each new recruit they brought to the organisation.
Mr Stockdale and Mr Baldwin left the country last month and are thought to have set up a similar scheme in Australia.
Net Guard members can contact the Commerce Commission on 0800 943-600 in business hours.
- NZPA
