The Ministry of Public Security has ordered police in 27 cities and provinces to join an investigation into a fraudulent multi-level marketing company that managed to scam more than 60,000 people.
Colonel Tran Quang Huy said the ministry had initially identified about 45,000 victims, but the number quickly surged to 60,000.
“There are still more victims and the amount of money involved is not only VND1.9 trillion (US$85.2 million) as previously thought,” he said.
Last week, the ministry arrested seven members of Hanoi-based Lien Ket Viet JSC, including chairman Le Xuan Giang, deputy general director Nguyen Thi Thuy and five of their employees.
Police said since late last year, many people have reported that they paid deposits to join the company but never received any commission as promised.
The minimum requirement was VND8.5 million ($380) a person, but many put down more in hopes of earning huge returns. The largest single deposit was a staggering VND6 billion ($270,000).
“These people have borrowed money from relatives and friends to join the company after being promised high commissions,” he said.
Huy said Giang and his accomplices have spent more than VND100 billion to pay commissions to a number of people and kept the rest for themselves.
Nguyen Thi Thuy, deputy general director of Lien Ket Viet JSC at an event. Photo supplied by the police
According to investigators, Giang, 45, used to serve in the military in the early 1990s and then studied at a vocational school of the Ministry of Defense.
In 2005, he opened a private company to sell supplements and healthcare devices.
He obtained a license for multi-level marketing in June 2014 and has since used army uniforms and fake shoulder marks to impersonate as a military officer, falsely claiming that his company was managed by the Ministry of Defense.
He also forged certificates of merit awarded by the prime minister to win the trust of customers.
Investigators also said that the company’s deputy general director Thuy, who used to be a hairdresser in Hai Duong Province, was actually the mastermind of the scheme.