§ 39-17-507 — Customer referral rebates unlawful

(a) With respect to a consumer sale, consumer credit sale or consumer lease, the seller or lessor may not give or offer to give a rebate or discount or otherwise pay or offer to pay value to a buyer or lessee as an inducement for a sale or lease in consideration of the buyer or lessee referring or giving to the seller or lessor the names of prospective customers or lessees, or otherwise aiding the seller or lessor in making a sale or lease to another person, if the earning of the rebate, discount, commission or other value is contingent upon the occurrence of an event subsequent to the time the buyer or lessee agrees to buy or lease. (b) If a buyer or lessee is induced by a violation of this section to enter into a consumer sale, consumer credit sale or consumer lease, then the transaction is declared to be a lottery and the agreement is unenforceable by the seller or lessor, and the buyer or lessee, at the buyer's or lessee's option, may rescind the agreement or retain the goods delivered and the benefits of any services performed, without any obligation to pay for them. (c) Any person offering to sell or lease goods or services in violation of this section commits a Class C misdemeanor.

Legislative History

Acts 1989, ch. 591, § 1.