Shanghai police crack 9 pyramid sales cases

Shanghai's market watchdogs have cracked nine pyramid sales cases this year, with about 1.78 million yuan (US$278,750) in fines and product value confiscated, city authorities revealed on Wednesday.

The city's police have dealt with 39 pyramid sales cases involving about 18 million yuan this year, and 34 people have been caught.

The Shanghai Administration for Market Regulation and the Shanghai Public Security Bureau on Wednesday launched an eight-week campaign to raise public awareness about pyramid sales and how to avoid them.

The exposure and crackdown on pyramid sales via the Internet will be stepped up after an increasing number of cases using new means was discovered, the administration said.

In one case, Shenzhen Kaiyuan Shengshi Co Ltd set up a financing platform online and charged membership fees from new members.

It lured old members with rewards such as Benz and Land Rover cars, apartments and villas to bring in new members.

The company had developed 195,007 members nationwide until the case was uncovered with 980 million yuan involved.