China launches nationwide crackdown on pyramid selling
(Xinhua)
Updated: 2006-09-20 20:54 BEIJING -- The State
Administration for Industry and Commerce (SAIC) of China has launched a
one-year-long nationwide crackdown on pyramid selling in collaboration with the
Ministry of Public Security.
The crackdown will mainly focus on Guangxi, Guangdong, Shandong, Henan and 10
others regions where pyramid selling is particularly rampant, a SAIC
spokesperson said here Wednesday.
The campaign will particularly target organizations engaged in cross-regional
pyramid selling, the recruitment of students into such activities, and
organizations that misrepresent reality to recruit their members, accommodate
them in dormitories and force them to engage in pyramid selling, the
spokesperson said.
Pyramid selling was outlawed in China in 1988. Years of crackdown, however,
have failed to completely weed out the evil.
Having set up better organizations that are harder to penetrate, pyramid
sellers are well disguised and highly intelligent. Many of them conduct business
on the Internet and others disguise their illegal activities as chain stores,
the spokesperson said.
In some cases, a pyramid selling organization may have thousands or even tens
of thousands of members, with a turnover of more than 1 billion yuan, said the
spokesperson.
In the first eight months of the year, Chinese authorities investigated 2,441
pyramid selling cases, taking as many as 420,000 people out of the illegal
workforce.
A total of 1,325 persons were prosecuted or convicted in 199 cases, the
spokesperson said.
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