The Commerce Commission is cracking down on the Lion's Share scheme, a cryptocurrency operation.
The commission announced it had sent a "Stop Now" letter to one of the promoters, Shelly Cullen, who was recommending it online and in person.
Cullen regularly held seminars online and in person, stating Lion's Share gave people an opportunity to earn extra money. She is popular on social media, with some of her videos receiving tens of thousands of views.
The letter urged Cullen to stop associating with and promoting Lion's Share.
On receiving the letter, Cullen told the Commission she had stopped promoting the scheme.
If she did not, the commission could seek an injunction in the High Court.
In a statement, the Commission said the investigation was ongoing.
"However, because it considers that the Lion's Share scheme is likely a pyramid scheme, the Commission advises any individuals already involved with the Lion's Share scheme to cease their involvement and those considering joining the Lion's Share scheme are advised not to do so," the statement read.
Pyramid schemes are illegal under the Fair Trading Act.
They can take many forms but usually offer a financial return based on payments made by new recruits.
Returns are dependent on the recruitment of new members, not sales of a product or service.
This is a problem because many participants will always be near the base of the pyramid and will not get the promised return on investment.
Only the few initial participants at the top of the pyramid would likely make money, since the number of possible new recruits in any community would be limited.