A pyramid scheme involving 1.3 billion yuan (US$186 million) is under investigation in northern China, said the Inner Mongolia police yesterday.
Senior executives of an Inner Mongolia forestry company have been detained for alleged pyramid sales of so called "forestry ownership" to more than 30,000 people.
Famous comic play writer He Qingkui was reported to be the image ambassador as well as the honorary chairman of the company. Police alleged he earned more than six million yuan from the company.
He was the life partner of famous comedian Gao Xiumin and the senior writer for Gao and comedian Zhao Benshan. Zhao and Gao were once the most popular comic drama partners in China and staged Spring Festival Gala every year till Gao died in 2005.
Zhao also acted in an advertisement for a well-known ant-farm pyramid sales company whose boss had been detained for further investigation.
Chen Xianggui, the board chairman, and Liu Yanying, the general manager, allegedly tricked victims into "buying" 28,700-hectare plots of useless poplar forestry using false propaganda and brainwashing techniques.
Police around the country have filed more than 40 investigations into the con and caught more than 70 suspects.
Police of Inner Mongolia, where the company registered, have caught 13 suspects including Chen, Liu and the other two senior executives.
Meanwhile, assets of the company have been frozen. A liquidation procedure on the company's headquarters has been completed by the end of last year.
He Qingkui was reported to be unwilling to return the money, police said.
He was not the first Chinese celebrity to become embroiled in business scams. Ge You, a film actor who starred in A Farewell to My Concubine and The Banquet also acted in a TV advertisement for a pyramid scheme company which sold forestry ownership, too.
Ge later apologized and returned 500,000 yuan.
(Shanghai Daily April 2, 2008)