cigaraga

SCAM ARTISTS TAKE ADVANTAGE OF DOWNTURN IN CHINA'S ECONOMY By Calum MacLeod, USA TODAY  Sept-7-2009  BEIJING — Zhang Xue remembers how dazzled she was by the sales pitch — a glamorous,  middle-aged woman who appeared in a sleek suit and jewelry and spoke of her successful  struggle to become a millionaire. "I only wanted to earn money and live by myself,"  says Zhang, 21, sobbing at the memory, "but I hurt my parents and friends."  The ensuing months saw her immersed in one of the many pyramid schemes and other financial frauds that have become common in China as the economy here  sputters and more people seek to earn a quick buck.  The proliferation of such schemes — many of which have morphed into bizarre,  cult-like underworlds — has bankrupted countless young Chinese of modest means as well  as richer, relatively savvy investors. That has in turn sparked a massive, unprecedented  crackdown by Chinese authorities who, b...

Pyramid selling is a fraud. It is a mechanism by which promoters of so-called “investment” or “trading” schemes enrich themselves in a geometric progression through the payments made by recruits to such schemes. Related deceitful schemes have been described in various international jurisdictions as “chain letters,” “snow balls,” “chain selling,” “money games,” “referral selling” and “investment lotteries”. Numerous legislatures around the globe have proscribed pyramid selling. The wording of relevant statutes, codes, articles, acts, regulations and the like vary, but all contain the following core concept: A pyramid is a scheme in which a recruit pays (an entry fee) for the opportunity to receive future benefits (money or privileges) which are primarily derived from that recruit’s (and/or subsequent recruits’) introduction of additional participants in the scheme, rather than from the sale of products to consumers. Thus, the scheme’s rewards effectively come from the addition of new p...