Scam slammed: The CCB team and the assortment of evidence taken from the pyramid swindlers

Commercial Crime Bureau investigators have helped impose the heaviest sentences to be meted out to pyramid swindlers in 20 years.

The two men and two women were each sentenced to up to four months prison (suspended) and fined up to $30,000 on August 25, the first pyramid swindlers to face jail since 1980.

In November 1998, CCB officers found a newspaper advertisement promoting profits of $2.4 million for people paying $240 to join a "game" organised by a company. It was found to be a syndicate deceiving people by promoting a pyramid selling scheme.

Extensive investigations by Fraud Division Team Four officers saw the quintet's arrest in December, 1998 charged with promoting the scam.

Undercover officers had attended a seminar and were introduced to a card game. Each applicant was lured into depositing $25 to each of the seven bank accounts printed on a game card issued to them. Another $65 had to be paid as a registration fee for the applicant to became a qualified member.

Members were then given a watch and five game cards to recruit new applicants. Seven bank accounts, including those of the member, were printed on each card. Members could then issue cards bearing his bank account to new applicants who would repeat the procedure.

Fraud Division Team Four Woman Senior Inspector Winifred Mui Bo-man said the cunning defendants set the limit to be paid by each victim to $240, so they would not be enticed to report the minor loss to Police.

"The success of the detection was attributed to the hard work and team spirit of all officers in CCB. As we had no informant in this case, all the information came from the Intelligence Section," she said.

Undercover Fraud Division officers recorded evidence of the defendants' activities.

"We also had assistance from our Treasury Accountants who helped work out the formula used in the scam. With their help, we found the formula was mathematically possible but practically impossible as the number of participants required to keep the game going would exceed the Hong Kong population!"

Fraud Division Chief Inspector Jean Ward described the investigation as time-consuming and manpower intensive.

"We made great efforts in analysing the computer programme for processing participantsa account numbers which would be automatically deleted from the programme shortly after they joined the game. It meant the participants were always in a losing situation."

He said the ever-changing modus operandi of the culprits and the reluctance of the victims to report the cases made investigations more difficult.

"This conviction can remind the public that all pyramid selling schemes as defined by Pyramid Selling Prohibition Ordinance Caption 355, are illegal.

"Colleagues of other divisions should consider this case when handling similar ones," CIP Ward said.

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