The deaths that sparked China’s crackdown on illegal pyramid schemes
People who join the schemes can be beaten and intimidated if they try to leave and the deaths of three members prompted the authorities into action
China’s latest crackdown on pyramid schemes was prompted by three shocking deaths – one young man who was beaten, another found dead in a pond and a third left to die on a road.
Like elsewhere in the world, the scams have proliferated in China as fraudsters trick people into thinking they can become rich quickly. Members are charged a joining fee and required to recruit new investors with promises of high returns.
But the three deaths in July put a spotlight on more extreme tactics used by some organisations in the world’s second largest economy, where the schemes can raise tens of billions of yuan.
Warning that pyramid schemes have become “more rampant”, four government agencies responded in August by launching a three-month crackdown that targets misleading online job adverts designed to lure young people.
Many of those who sign up online to promises of easy riches discover a harsh reality in which they are faced with intense demands, harassment or even physical abuse.