7 Arrested in Suspected Pyramid Scheme : Crime: The group, including a Simi Valley police officer, collected more than $100,000 from investors.

They called it the “Moneytree” and managed to attract more than $100,000 in investments, but the district attorney’s office called it a pyramid scheme and uprooted it Sunday by arresting the seven people who allegedly organized it--including a Simi Valley police officer.

The organizers, who were called chairmen, attracted more than 100 investors by promising huge returns, officials said.

“These are mostly middle-class people who are asked to participate by friends and co-workers,” said Jeffrey Bennett, a chief deputy with the district attorney’s office.

“They come into it because they think they’ll get something for nothing,” Bennett said. “They’re convinced that they can make an easy buck or a lot of easy bucks.”

As with other pyramid schemes, the only participants to reap huge profits were the ones who started the scheme, he said. The organizers were able to sign up investors, who each put in $1,000, with the hope that they too could make a lot of money.

The investors then turned around and used the promise of big bucks to attract another tier of participants to put money into the scheme, Bennett said.

Typically, a pyramid scheme holds up only as long as there is a steady supply of new investors. Those few participants on the upper tiers of the pyramid can reap huge amounts of money, but once the pool of new people willing to risk the initial fee dries up, the scheme crumbles and the large number of people on the bottom rungs of the pyramid lose out on their whole investment, Bennett said.

“It’s based on an unrealistic expectation that there will always be willing participants,” he said. “Your money is at risk until you are able to find eight or more new participants. If you can’t do that, you lose.”

Popular in the late 1970s and early 1980s, the schemes seemed to die out, only to resurface again across Southern California, Bennett said. Pyramid participants hold small parties in their homes to explain the game to new investors.

The hitch is that the game is illegal.

Investigators said they waited until money changed hands to make Sunday’s arrests. Taken into custody were Simi Valley Police Officer Michael Charles Cratch, 24, along with Gregory Stephen Jones, 24; Kevin Matthew Novak, 22; Lorraine Priscilla Saybill, 52; Richard Allen Saybill, 55, and Roland Ventura Tamparong, 23, all of Simi Valley, and Mark Harlan McCord, 35, of Burbank. About 20 other people were at the home and were not arrested, Bennett said.

Cratch, a Simi Valley patrol officer for three years, was placed on paid administrative leave pending the outcome of the investigation, said Lt. Tony Harper, a spokesman for the Simi Valley Police Department.

This is the second administrative leave for Cratch, who was placed on leave a year ago after firing his weapon while chasing two men who allegedly stole a car. Cratch came to the department after working 18 months for the Los Angeles County Sheriff’s Department, where he served as a guard in the Peter J. Pitchess Honor Rancho county jail in Castaic.

Cratch, the Saybills and McCord were all released on $5,000 bail pending an arraignment Friday, a jail spokeswoman said. Jones, Novak and Tamparong all were booked into the Ventura County Jail. Their bail is also set at $5,000, and if they do not post it they will be arraigned today, the spokeswoman said.

If convicted, the seven accused organizers face a maximum penalty of three years in state prison for each violation.

District attorney investigators expect to make similar busts in the next several weeks, Bennett said.

“We know there are a lot more schemes operating in Simi Valley,” he said. “We anticipate additional arrests on this scheme and others very soon.”