Police nab suspects in pyramid sales scam
By Li Jinghao |
March 25, 2012, Sunday
|
Print Edition
Print Edition
SIX suspects who allegedly cheated about 600,000 people out of nearly 3 billion yuan (US$475 million) on the Chinese mainland under a pyramid sales scam were arrested in Shenzhen, Guangdong Province.
The suspects will face criminal charges, Guangzhou Daily reported yesterday, citing the Shenzhen Public Security Bureau.
The suspects allegedly conducted the scam under the name of a Hong Kong company called ABM and recruited victims to sell Internet telephone software, according to the report.
The gang tried to convince victims with claims that entrepreneur Richard Li, son of Hong Kong's business tycoon Li Ka-shing, held a 30 percent stake in the company while also claiming its operation was supported by Donald Tsang Yam-kuen, chief executive of the Hong Kong Special Administrative Region.
On promotion pamphlets distributed by the company, there are photos of Li Xing, the director of ABM and the main suspect, posing with Tsang and Li Ka-shing, police said.
However, an investigation by Shenzhen police found Li Xing took the photos with wax figures at Hong Kong's Madam Tussauds Museum and then used computer software to alter the images, according to the report.
Shenzhen police said the victims were lured to pay for Internet telephone software called "Mycool" and encouraged to recruit more people to the business, which has been confirmed as a pyramid selling scheme.
Victim Xie Shuhua told the newspaper that she visited Hong Kong to check out the company before paying more than 50,000 yuan for a "membership fee."
After seeing the "celebrity pictures" at the company's 200-square-meter reception center, Xie agreed to join, according to the report.
However, Xie and another 40 victims lost contact with ABM since February 2010. She went to Hong Kong again, only to find an empty office in the building where she signed the contract, the report said.
The victims jointly sent complaints to Shenzhen's consumer rights protection watchdog, who reported to police after suspecting it might be an illegal pyramid sales scam, according to the report.
The suspects will face criminal charges, Guangzhou Daily reported yesterday, citing the Shenzhen Public Security Bureau.
The suspects allegedly conducted the scam under the name of a Hong Kong company called ABM and recruited victims to sell Internet telephone software, according to the report.
The gang tried to convince victims with claims that entrepreneur Richard Li, son of Hong Kong's business tycoon Li Ka-shing, held a 30 percent stake in the company while also claiming its operation was supported by Donald Tsang Yam-kuen, chief executive of the Hong Kong Special Administrative Region.
On promotion pamphlets distributed by the company, there are photos of Li Xing, the director of ABM and the main suspect, posing with Tsang and Li Ka-shing, police said.
However, an investigation by Shenzhen police found Li Xing took the photos with wax figures at Hong Kong's Madam Tussauds Museum and then used computer software to alter the images, according to the report.
Shenzhen police said the victims were lured to pay for Internet telephone software called "Mycool" and encouraged to recruit more people to the business, which has been confirmed as a pyramid selling scheme.
Victim Xie Shuhua told the newspaper that she visited Hong Kong to check out the company before paying more than 50,000 yuan for a "membership fee."
After seeing the "celebrity pictures" at the company's 200-square-meter reception center, Xie agreed to join, according to the report.
However, Xie and another 40 victims lost contact with ABM since February 2010. She went to Hong Kong again, only to find an empty office in the building where she signed the contract, the report said.
The victims jointly sent complaints to Shenzhen's consumer rights protection watchdog, who reported to police after suspecting it might be an illegal pyramid sales scam, according to the report.
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