> I'm sure there are legal implications of running a Ponzi scheme too. I'm positive that telling someone about the illegal thing you're doing does not absolve you of responsibility.

In the specific case of a Ponzi scheme, which by definition is a scam where “investors” are decieved as to the nature of the operation, disclosing the mechanics make it not a Ponzi.

It does seem to still be an illegal pyramid scheme, though it doesn't rely on an entrants recruiting their own downline, instead having a shared downline.