63 sentenced over SW China pyramid selling

KUNMING - Sixty-three people involved in a pyramid selling scheme in Southwest China's Yunnan province have been given jail terms ranging from one year to 42 months, a local court has said.

According to this announcement issued on Sunday, the People's Court of Chenggong district in Kunming city ruled in the first-instance judgement that the 63 people, 51 of whom have been held in custody and 12 bailed pending final trial, are guilty of organizing pyramid selling in Kunming.

Forty of the fraudsters have been given suspended sentences, said the court.

The pyramid selling ring moved its operation to Kunming from Nanning, capital city of neighboring Guangxi Zhuang autonomous region, in November, 2011, with over 500 people and 20 million yuan (about $3.2 million) involved before it was shut down by police.

Using chain selling as a disguise, the chief suspects built a network based on interpersonal relationships where members in the pyramid selling ring were offered commission after persuading their friends and relatives to participate.

Pyramid selling has been banned in China since 1998 but still operates underground in some less developed regions.