Soon, it will be the Legislature's turn to listen to a network marketing spiel.

With the backing of the state's multilevel network marketing companies and their national organization - the Direct Selling Association (DSA) - Rep. Mike Noel, R-Kanab, intends to sponsor legislation he contends will strengthen the state's anti-pyramid-scheme laws.

"This is pro-consumer, pro-legitimate network marketing company legislation," Noel said, indicating the bill will provide a better definition of what constitutes an illegal pyramid scheme and help differentiate the outright scams from legitimate companies.

However, critics of the multilevel marketing industry, including Utahn Jon M. Taylor of Bountiful, author of The Network Marketing Game, maintains that describing the legislation as an anti-pyramid-scheme law is itself a fraud.

Instead of preventing pyramid schemes, the legislation would allow several of the most notorious scams recently shut down by the Federal Trade Commission to flourish in Utah, Taylor said.

"For lack of a better description, this legislation is a wolf in sheep's clothing," Taylor said. "All it does is help legitimize existing product-based pyramid schemes - including the programs of the so-called legitimate Utah companies that maintain they're offering tremendous business opportunities, when in fact my studies show more than 99 percent of the people who get involved end up losing money."

In multilevel, or network, marketing, independent distributors earn commissions on the merchandise they sell. More importantly, they get a piece of the sales from new distributors they recruit, and on down the line.

Given the size and the ubiquitous nature of the state's multilevel marketing industry, its political influence and connections - Gov. Jon Huntsman Jr.'s chief of staff Jason Chaffetz, for example, is a former spokesman for Nu Skin - it is unclear whether the proposed legislation will face opposition.

Utah Attorney General Mark Shurtleff intends to support the bill, spokesman Paul Murphy said.

But Francine Giani, director of the state's Division of Consumer Protection, still has questions.

"We had some concerns about the language we saw months ago, and told them we opposed it. We haven't seen the final version of the bill yet, so we're neutral right now," she said.

While the exact language of the Utah legislation has yet to be published, the bill mirrors a proposed DSA-backed federal law - the "Anti-Pyramid Promotion Scheme Act" - and is similar to legislation recently passed in Idaho and South Dakota.

"This year we're coming to Utah," said Dean Heyl of the DSA. "We believe this legislation will help promote best practices within the industry and create problems for those fraudulent pyramid schemes where a person ends up with a garage full of stuff and nowhere to sell it."

Heyl said the legislation will contain a provision that suggests, but doesn't require, Utah network marketing companies agree to repurchase 90 percent of a distributor's unsold merchandise within a year of the distributor leaving the program.

Critics Taylor and Robert Fitzpatrick of http://www. pyramidschemealert.org particularly are concerned the proposed Utah bill will eliminate any requirement that network marketing companies retail at least some of their products to consumers.

Heyl conceded the DSA would like to see language included in the Utah bill that redefines retail sales to include those made to company distributors. But he said changing the definition would not be a problem provided companies agree to product-repurchase provisions for distri- butors.

Fitzpatrick is troubled none- theless.

Such language could allow an "endless chain pyramid scheme" where virtually no products are ever retailed to the public, he said.

Instead, the bill would legalize companies to give enormous payments to its existing insiders - those who joined the system early and remain at the top of the sales pyramid - with all the money coming not from retail sales but from the purchases made by the latest group or recruits.

Such a loophole would have allowed Destiny Telecom, International Heritage, Equinox and many other so-called multilevel marketing companies to remain in business instead of being shut down by government authorities who determined them to be operating as pyramid schemes, according to pyramidschemealert

.org.

Nu Skin said all illegal pyramid schemes give legitimate multilevel marketing companies a bad name.

"This proposed legislation gives a better definition of illegal pyramids but at the same time creates a safe haven for the legitimate Utah companies," said Rich Hartvigsen, Nu Skin's vice president of global regulatory affairs.

Taylor, an avowed Nu Skin critic who recently set up a Web site at http://mlm-thetruth.com, contends there is little difference between Utah's largest multilevel marketing companies.

"The overwhelming majority of Nu Skin distributors and those who join most other Utah multilevel marketing companies will never make money," Taylor said. "Their chances of success would be better if they put their money down on one of the gaming tables in Wendover."

steve@sltrib.com