China has convicted three organizers of a crypto pyramid scheme that defrauded over 10,000 people. The Zhongxiang City Procuratorate confiscated 22.59 million yuan in illegal gains. The organizers received three-year prison sentences, suspended for five years, and were fined 350,000 yuan each.
Arrest and Sentencing of Organizers
Chinese authorities have convicted three ringleaders of a crypto pyramid scheme that defrauded over 10,000 people. On September 18, the Zhongxiang City Procuratorate confiscated over 22.59 million yuan (roughly $32 million) in illegal profits, and each leader received a three-year prison sentence, suspended for five years, and was fined 350,000 yuan each.
The Fraudulent Scheme and Organizers
Chen, Ding, and Fu orchestrated the scheme, which deceived victims through a fake virtual currency project that amassed more than 57 million yuan. The scheme started in late 2021 when the trio created an app promising high returns through virtual currency investments. They heavily promoted the project through social media platforms and offline meetings, luring victims with promises of “guaranteed profits” and easy money.
Exposure and Outcomes
The breakthrough came after one of the victims, Mr. Wang, invested $5,000 after being drawn into a WeChat scam. Following the exposure of the scheme, Chinese authorities took active measures to return funds to the victims and arrest the organizers.
This case highlights the importance of vigilance and awareness among citizens about the risks associated with investing in virtual currencies. Organizers of such schemes face severe consequences, including prison sentences and hefty fines.
Comments