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Shanghai police crack $16m pyramid scheme

Updated: 2013-08-13 19:18
By Zhou Wenting ( chinadaily.com.cn)

A pyramid scheme, which involved more than 100 million yuan ($16 million) and nearly 7,000 members across 28 provinces and municipalities on the Chinese mainland, has been cracked, Shanghai police said in a news conference on Tuesday.

Police found Shanghai Chengshangcheng Co suspected of pyramid selling in the name of promoting cosmetics and health products in March.

"The manager of the company, surnamed Liu, had made a considerable amount of money by collecting membership fees and letting the members develop selling networks," said Xu Qin, a police officer with the economic crime investigation team of the Shanghai police.

With the assistance of police in Zhejiang and Anhui provinces, more than 20 suspects, including Liu, were detained on July 16 for allegedly organizing the pyramid scheme.

The company's bank accounts, as well as Liu's personal accounts, have been frozen by police.

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