6 arrested for major US$475 million pyramid scheme in Shenzhen
Staff Reporter
2012-03-26
11:10 (GMT+8)
The scam leader posed with wax figures of prominent people to lure in investors. (Internet photo)
Six suspects have been arrested in Shenzhen for scamming around 600,000 people out of nearly 3 billion yuan (US$475 million) in China by using a Hong Kong entrepreneur's name to run a pyramid scheme.
The suspects allegedly used the name of a Hong Kong company named ABM to recruit victims to sell Mycool internet telephone software, according to a report conducted by the Shenzhen Public Security Bureau.
The suspects allegedly used the name of Richard Li, son of Hong Kong business tycoon Li Ka-shing, to lure victims into a false sense of security.
They claimed that Richard Li held a 30% stake in the company and that its operation was supported by Donald Tsang, 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.
Police say Li Xing's photo op was actually taken with wax figures of the famous men at Hong Kong's Madam Tussauds and then photoshopped, according to the report.
A member said she was persuaded ABM was legal after seeing the pictures of Li Xing and famous people. She also said the company's office in Hong Kong was top-notch.
However, when she went back to the office, she found no one there and guessed she had been duped.
She found other victims, who then complained together about the scam to Shenzhen's consumer rights protection watchdog, according to the report.
References:
Richard Li 李澤楷
Li Ka-shing 李嘉誠
Donald Tsang 曾蔭權
