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'Decoding Commercial Crimes' series on |
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Have you seen the latest TV announcement-of-public-interests on pyramid schemes? Perpetrators introduce the schemes as "business opportunities" to their friends, making them victims of pyramid scam. As participants of the schemes can make a profit only by recruiting new members, the schemes operate with the entry fees paid by new members and will collapse if the membership recruitment is not successful. In January this year, the new Pyramid Schemes Prohibition Ordinance was enacted, replacing the Pyramid Selling Prohibition Ordinance. The new legislation target the persons in charge of the company and the personnel involved in the recruitment with more stringent penalties to reflect the seriousness of the offence. Under the current legislation, any person who knows or ought to know that the income of the schemes is entirely or substantially derived from introduction of new members, and who induces or attempts to induce another person to join the schemes, commits an offence. However, given most of the perpetrators may use specious means to disguise a pyramid scheme as a multi-level marketing network, the general public might have confusion in distinguishing it from a legitimate direct-selling scheme, which also adopts a multi-level marketing structure. For more information and tips on prevention of pyramid scheme-related fraud, surf RTHK's website at www.rthk.org.hk for the episode of "Decoding Commercial Crimes" on the Police Magazine TV programme. The next topic of the "Decoding Commercial Crimes" series is insurance-related fraud. |
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