Vietnamese man gets life in jail for pyramid scheme swindle

By Viet Dung   November 29, 2018 | 10:04 am GMT+7
Vietnamese man gets life in jail for pyramid scheme swindle
Nguyen The Anh (C) got life sentence for scamming nearly 8,000 investors in pyramid scheme. Photo by VnExpress

A Hanoi court Wednesday sentenced a man to life imprisonment for swindling millions of dollars through multilevel marketing schemes.

Nguyen The Anh, 39, general director of Phuc Gia Bao 68 Commercial Investment JSC and Phuc Gia Bao 868 Commercial Investment JSC, was found guilty of "appropriating property through swindling."

The court also sentenced Phuc Gia Bao 868's two deputy general directors to 14-16 years in prison, while another 11 accomplices who were branch directors of the two companies received 2-11 year sentences.

The defendants, chiefly Anh, were also ordered to return over VND100 billion ($4.3 million) that they had appropriated from their investors.

According to the indictment, Anh founded the two companies as multi-level marketing companies to sell global coffee marketer Organo Gold's products. Under his instructions, the companies' 18 branch directors organized conferences for investors, where they were given free coffee and promised interest rates of 24-80 percent per month.

Using the promise of high interest rates and preferential policies such as free travel tours and VIP cards, between July 2015 and February 2016, Anh's two companies managed to sign over 8,600 contracts with investors and received investments of over VND320 billion ($13.68 million).

Out of this money, the companies used over VND203 billion ($8.68 million) to pay investors' interests while the remaining VND120 billion ($5.13 million) went to Anh and his employees or were used to buy gifts and organize tours for investors.

As of the time of the trial, investigators had identified over 600 of Anh's victims. According to their reports, they had given him over VND146 billion ($6.24 million) but had only received VND40 billion ($1.71 million) in interest, and the remaining VND100 billion had been appropriated by Anh.

Speaking at the trial on Wednesday, Anh admitted to his violations. He instructed his employees to organize conferences to promote the companies and served investors coffee of unknown origin bought from the open market.

He also admitted to personally signing about 7,000 contracts with investors worth VND260 billion ($11.1 million) and processing about 90 percent of interest payments. Anh claimed that the money collected was also used to pay salaries for 2,000 employees and for paying land rent.

Regarding the VND80 billion ($3.42 million) he was ordered to return to his victims, Anh said he would work hard to pay this amount once he finishes serving his sentence, because he was penniless now.

Anh's deputies denied being his accomplices as accused, while the 11 branch directors claimed innocence, saying they were simply hired employees working for a salary.

The court however dismissed these claims, concluding that Anh had masterminded the fraud from the beginning with no regard for consequence while the other defendants were his active accomplices.

 
 
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