Authorities find more online variations of illegal pyramid schemes

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More and more online applications are showing signs of illegal cash flow and multilevel business operation which had caused many people to go bankrupt, the Ministry of Public Security said.

A company called Winsbank paying users “commission” via a 10-tier reward system

A company called Winsbank paying users “commission” via a 10-tier reward system

There are only 21 licensed multi-level marketing companies as of August 2020 compared to 30 at the beginning of the year, said the latest report from the Ministry of Industry and Trade.

More notably, up to 12 multi-level companies exited the scene with reasons ranging from revoked or non-renewable business license to voluntary withdrawal. This proved that scams running on pyramid schemes were starting to die out, the Ministry commented.
In recent years, however, scammers no longer have to hold large gatherings to lure people in and get their attention.
They are taking advantage of social media, advertising themselves as the “gateway startup” for small businesses and entrepreneurs, targeting young people looking for ways to make quick and easy bucks.
They mostly reward users with virtual tokens that are not recorded on any official documents, while main servers are located overseas and the project owners do not live in Vietnam. As a result, authorities have a hard time tracking down these illegal businesses.
Authorities advise each person to educate themselves on the potential risks when making online investments.

By Van Phuc - Translated by Tan Nghia

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