Nearly 67,000 Vietnamese scammed of $88mn by pyramid company

Tuoi Tre News

Updated : 04/14/2017 15:00 GMT + 7

 

Le Xuan Giang is dressed in his military uniform during an event organized for Lien Ket Viet Company.
File Photo

Nearly 67,000 people in Vietnam fell victim to a multi-level marketing company, losing over VND2 trillion (US$88.4 million) in the fraudulent business scheme.

Officers from the Ministry of Public Security on Thursday announced the result of an investigation into fraud and property appropriation charges against Lien Ket Viet, a company specializing in network marketing.

The Supreme People’s Procuracy has been asked to begin legal procedures against Le Xuan Giang, chairman of Lien Ket Viet management board, Le Van Tu, general director, Nguyen Thi Thuy, deputy general director, and four other accomplices.

According to the case file, Giang founded the company and organized several events to gain trust and a positive reputation from his clients and potential investors.

Giang also invited retired military officers and generals to his events, requesting they grant his company fake certificates stating that the firm is managed by Ministry of National Defense.

The man also claimed to be a military colonel to add substance to claims that the company’s products – physical therapy machines, ozone deodorizing devices, and a variety of dietary supplements – belonged to units under the defense ministry.

In late 2014, Giang asked an acquaintance in Ho Chi Minh City to forge ten merits he would later say were awarded by the prime minister to Lien Ket Viet and its leaders.

Several ceremonies were later held to publicize these ‘achievements’ and manipulate clients.

From March 2014 to November 2015, Giang and his accomplices opened 35 representative offices in 27 cities and provinces across Vietnam, scamming nearly 67,000 people into signing deals worth a combined VND2.1 trillion ($92.8 million).

Contracts with Lien Ket Viet stated that clients would first buy merchandise and later resell it to their own customers.

With each product sold, clients were promised 65 percent commission, much higher than the 40 percent commission regulated by the central government for multi-level marketing operations.

Aside from multiple tiers of commission, the victims were also guaranteed a monthly salary and bonus from company leaders.

Long-term members would also be eligible for participation in regular lucky drawings for attractive prizes such as apartments, cars, and expensive tours.

During the first phase of the operation, clients were paid the commission they were promised. The payments gradually diminished, however, before being completely cut off in November 2015.

By the time victims realized they the operation was a scam, they had already lost a huge amounts of money.

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This entry was posted in Economics - Kinh tế, Hạ tầng thương mại - Business infrastructures and tagged by Trần Đình Hoành. Bookmark the permalink.

About Trần Đình Hoành

I am an attorney in the Washington DC area, with a Doctor of Law in the US, attended the master program at the National School of Administration of Việt Nam, and graduated from Sài Gòn University Law School. I aso studied philosophy at the School of Letters in Sài Gòn. I have worked as an anti-trust attorney for Federal Trade Commission and a litigator for a fortune-100 telecom company in Washington DC. I have taught law courses for legal professionals in Việt Nam and still counsel VN government agencies on legal matters. I have founded and managed businesses for me and my family, both law and non-law. I have published many articles on national newspapers and radio stations in Việt Nam. In 1989 I was one of the founding members of US-VN Trade Council, working to re-establish US-VN relationship. Since the early 90's, I have established and managed VNFORUM and VNBIZ forum on VN-related matters; these forums are the subject of a PhD thesis by Dr. Caroline Valverde at UC-Berkeley and her book Transnationalizing Viet Nam. I translate poetry and my translation of "A Request at Đồng Lộc Cemetery" is now engraved on a stone memorial at Đồng Lộc National Shrine in VN. I study and teach the Bible and Buddhism. In 2009 I founded and still manage dotchuoinon.com on positive thinking and two other blogs on Buddhism. In 2015 a group of friends and I founded website CVD - Conversations on Vietnam Development (cvdvn.net). I study the art of leadership with many friends who are religious, business and government leaders from many countries. In October 2011 Phu Nu Publishing House in Hanoi published my book "Positive Thinking to Change Your Life", in Vietnamese (TƯ DUY TÍCH CỰC Thay Đổi Cuộc Sống). In December 2013 Phu Nu Publishing House published my book "10 Core Values for Success". I practice Jiu Jitsu and Tai Chi for health, and play guitar as a hobby, usually accompanying my wife Trần Lê Túy Phượng, aka singer Linh Phượng.

One thought on “Nearly 67,000 Vietnamese scammed of $88mn by pyramid company

  1. Cách đây khoảng 10 năm, một số công ty đa cấp đứng đắn ở Mỹ nhờ mình mở network ở VN, Mình nói: “No, bởi vì hệ thống luật VN còn yếu, thiên hạ lại thích nói dối, và đa cấp thường dễ kích thích người ta nói dối, cho nên tôi chẳng cách nào quản lý người của tôi nếu tôi có một network rộng.”

    Số lượt thích

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