Odaily Planet Daily News: The Zhongxiang City Procuratorate of Hubei Province recently filed a public prosecution against Chen and three others for organizing and leading pyramid schemes. After a judgment in accordance with the law, Chen and three others were convicted of organizing and leading pyramid schemes and were sentenced to three years in prison, suspended for five years, and fined RMB 350,000. At present, the relevant judgment has come into effect. The police investigation found that a pyramid scheme organization headed by Chen, Ding, and Fu decided to issue self-created virtual currency to obtain income. The three agreed on matters such as the promotion model, reward system, and profit distribution mechanism, and went to other places to find Lu, the head of a software design company (handled in another case), to develop a virtual currency software APP. In February 2022, the APP was officially launched. On February 19 of the same year, Chen and three others held a press conference for the APP, and called on friends to participate in the virtual currency project. At the same time, under the name of investing in virtual currency projects, a pyramid scheme organization "XX Community" was established. In order to improve the promotion efficiency, Chen and his two friends used the Internet platform and held offline training sessions across the country to promote the virtual currency project, develop members through the "XX Community", and induce others to invest in virtual currency to become members and develop downlines. According to the prosecutor in charge, Chen and his two friends gave corresponding rebates to upline members according to the number of downlines developed and the amount of downline members paid, forming an upline and downline hierarchy. After several months of careful promotion, the organization grew rapidly. For the convenience of management, the three people divided the organization into five major war zones and sixteen pioneer groups according to the region, and selected key members to be responsible for each. The five major war zones organized members to hold morning meetings every day through online chat software, calling on members to complete the performance tasks assigned. As of the time of the incident, the APP had more than 10,000 registered member accounts, with the highest level being 17, and the amount involved in the case reached more than 57 million yuan. "The virtual currency has no actual value, and the project does not have any real business activities. It relies entirely on the continuous development of downlines to maintain operation. The money earned by the online people is actually the money invested by the downlines. Once there is no steady stream of downlines investing funds, the project will collapse." The prosecutor in charge introduced that Ding, Fu, and Chen directly or indirectly developed more than 41 downlines through the APP, and their organizational form has constituted a pyramid scheme in the sense of criminal law.On January 11, 2023, Chen, Ding, and Fu were arrested by the police. After being arrested, the three confessed their crimes truthfully and voluntarily returned all illegal gains of more than 22.59 million yuan. On December 22, 2023, the case was transferred to the Zhongxiang City Procuratorate for prosecution. The prosecutor in charge believed that the actions of Chen, Ding, and Fu were clear in facts, and the evidence was solid and sufficient. Their actions violated the provisions of Article 224 of the Criminal Law of the People's Republic of China and constituted the crime of organizing and leading pyramid selling activities. After the court filed a public prosecution in accordance with the law, the local court made the above judgment. (Jimu News)