Infinite loop CTE with OPTION (maxrecursion 0)

If you are hitting the recursion limit, you either have considerable depth in sponsoring relationships or a loop in the data. A query like the following will detect loops and terminate the recursion:

declare @tblMember as Table ( MemberId Int, SponsorMemberId Int );
insert into @tblMember ( MemberId, SponsorMemberId ) values
  ( 1, 2 ), ( 2, 3 ), ( 3, 5 ), ( 4, 5 ), ( 5, 1 ), ( 3, 3 );
declare @MemberId as Int = 3;
declare @False as Bit = 0, @True as Bit = 1;

with Children as (
  select MemberId, SponsorMemberId,
    Convert( VarChar(4096), '>' + Convert( VarChar(10), MemberId ) + '>' ) as Path, @False as Loop
    from @tblMember
    where MemberId = @MemberId
  union all
  select Child.MemberId, Child.SponsorMemberId,
    Convert( VarChar(4096), Path + Convert( VarChar(10), Child.MemberId ) + '>' ),
    case when CharIndex( '>' + Convert( VarChar(10), Child.MemberId ) + '>', Path ) = 0 then @False else @True end
    from @tblMember as Child inner join
      Children as Parent on Parent.MemberId = Child.SponsorMemberId
    where Parent.Loop = 0 )
  select *
    from Children
    option ( MaxRecursion 0 );