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Final court ruling on Ponzi scheme
By Li Xinran |
June 18, 2009, Thursday
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Print Edition
Print Edition
A COURT in Beijing reduced the punishment or set free four defendants in the city's biggest Ponzi scheme that trapped more than 22,000 people across the nation because they had offered investigators tips or returned the illicit money.
The Beijing Higher People's Court issued the final ruling yesterday morning and upheld the original judgment by Beijing No. 2 Intermediate People's Court on 24 other defendants in the case, Legal Evening News reported.
The court found Zhang Jianjun deserved lighter punishment because he offered tips, returned illicit money and turned himself in during the investigation.
Yang Yuguang, an accessory who returned most of the illicit money, was put on probation.
Li Jianqing and Yu Fengbo, who surrendered to police and retuned most of their illicit money, were not punished.
The report did not state the original sentences of the defendants. Ringleader Zhao Pengyun, 39, was sentenced to 15 years in prison for swindling 1.68 billion yuan (US$246 million) from more than 22,000 victims in 11 provincial areas by promising high returns on an investment in trees, the report said.
He was also fined 300.3 million yuan, while the other 23 suspects, all legal representatives and general managers from Zhao's company, Beijing-based Yilin Wood Group, received sentences ranging from one to 15 years.
The scam, spanning from April 2004 to May 2006, used a pyramid structure in which one salesperson recruited others, who in turn recruited more people to sell purported investment products.
New participants were required to invest cash to join the operation. Early investors received commissions to make the scam look legitimate, according to the report.
Zhao planned the fraud with two other inmates while he was in jail in early 2004 after being sentenced to a year and 10 months for another pyramid scheme in 2002.
Zhao set up subsidiaries of Yilin Wood Group in Beijing, Chongqing, Inner Mongolia, Guizhou and Liaoning after getting out of prison.
The company promised investors they would earn 6,000 to 7,000 yuan per 0.07 hectares of forestry land after the timber was harvested.
Zhao used advertisements and fake certificates to lure investors, the report added.
The Beijing Higher People's Court issued the final ruling yesterday morning and upheld the original judgment by Beijing No. 2 Intermediate People's Court on 24 other defendants in the case, Legal Evening News reported.
The court found Zhang Jianjun deserved lighter punishment because he offered tips, returned illicit money and turned himself in during the investigation.
Yang Yuguang, an accessory who returned most of the illicit money, was put on probation.
Li Jianqing and Yu Fengbo, who surrendered to police and retuned most of their illicit money, were not punished.
The report did not state the original sentences of the defendants. Ringleader Zhao Pengyun, 39, was sentenced to 15 years in prison for swindling 1.68 billion yuan (US$246 million) from more than 22,000 victims in 11 provincial areas by promising high returns on an investment in trees, the report said.
He was also fined 300.3 million yuan, while the other 23 suspects, all legal representatives and general managers from Zhao's company, Beijing-based Yilin Wood Group, received sentences ranging from one to 15 years.
The scam, spanning from April 2004 to May 2006, used a pyramid structure in which one salesperson recruited others, who in turn recruited more people to sell purported investment products.
New participants were required to invest cash to join the operation. Early investors received commissions to make the scam look legitimate, according to the report.
Zhao planned the fraud with two other inmates while he was in jail in early 2004 after being sentenced to a year and 10 months for another pyramid scheme in 2002.
Zhao set up subsidiaries of Yilin Wood Group in Beijing, Chongqing, Inner Mongolia, Guizhou and Liaoning after getting out of prison.
The company promised investors they would earn 6,000 to 7,000 yuan per 0.07 hectares of forestry land after the timber was harvested.
Zhao used advertisements and fake certificates to lure investors, the report added.
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