Pyramid sales bosses cheated 400, court told
Alleged fraudsters swindled more than 400 people - mostly housewives - out of HK$3.3 million in a pyramid selling scheme that promised returns of up to 5,500 per cent, a court heard yesterday.
The ruses included a claim that they worked for an international company running an organic pig farm in Shenzhen.
Victims were lured to invest in health products including air freshener, essential oils, shampoos and pillows after being promised the amazing returns, the District Court heard.
Five people have pleaded not guilty to a joint charge of conspiracy to defraud between August 2004, and April last year.
Prosecutor Susanna Ku said Tsui Chi-kin, 37, head of Vantage International Development, held weekly talks to promote the scheme that drew up to 200 participants.
Co-defendants Lan Hung, 44, Lam Che-cheung, 44, Lam Yuk-fan, 53, and Yau Ah-ngan, 56, were said to be team heads who induced the victims to invest.
Ms Ku said the victims paid a membership fee to join the scheme that qualified them for coupons they could redeem for products. They were also promised attractive cash rebates if they made further investments and additional rewards for introducing new members.
The prosecutor said the promised money was often delayed or not paid. Some were paid a portion of it but no one was paid in full. Others were unable to redeem products they bought.
Tsui had claimed the firm was a international one with lucrative business, including a mainland subsidiary that ran an organic pig farm and a slaughterhouse in Dongguan , Ms Ku said.
He had claimed the farm reared a new breed of pig, 'Sakura', from a patented technology developed by universities and the meat would soon be available for local hot pot caterers and members.
Tsui had told members the firm was legal because he had obtained advice from lawyers, including one identified as 'Ching Hung' .
The case was reported to police in November 2004 and an undercover investigation led to the arrest.
The trial continues today before Deputy District Court Judge Andrew Chan Hing-wai.