Smash Ponzi racket targeting homebuyers

A NEW TYPE of multilevel investment scheme has emerged in Yanjiao, a town in Hebei province to the southeast of Beijing. Slightly different from pyramid schemes, the new one is a shell company encouraging households to invest 49,800 yuan ($7,500) for promised returns of up to 4.5 million yuan. Such an offer could easily entice people into a trap. The Beijing News commented on Monday:

Although the new multilevel investment scheme claims to be different from Ponzi schemes, it is essentially no different from the ploys used by fraudsters earlier to cheat people out of their hard-earned money.

Yanjiao is about 33 kilometers from the Central Business District of Beijing and an important point on the development plan for Beijing-Tianjin-Hebei integrated area. So such pyramid schemes will not only undermine the social order of Yanjiao, but can also affect the security of Beijing.