Prosecution of leaders of Lien Ket Viet company for defrauding more than 45,000 people

In just over 1 year of operation, the board of directors of Lien Ket Viet Company has defrauded more than 45,000 people of over 1,900 billion VND from multi-level marketing activities...

Conducting an investigation into the business activities of Vietnam Production and Trade Joint Stock Company (Lien Ket Viet), the Ministry of Public Security's investigation police agency has initiated a case of Fraudulent appropriation of property, prosecuted the accused, executed a search warrant, and temporarily detained 7 leaders and general agents of this company for the above crime.

The defendants detained include Le Xuan Giang (Le Xuan Ha), Chairman of the Board of Directors; Nguyen Thi Thuy, Le Van Tu, both Deputy General Directors; Nguyen Xuan Truong, Vu Thi Hong Dung, Le Thanh Son, all members of the group promoting, propagating, and developing the multi-level system in the provinces; and Trinh Xuan Sang, in charge of information technology of this company.

Defendant Le Xuan Giang (in military uniform) at a conference of Lien Ket Viet. nh:lkv.com.vn

Hire people to develop fraudulent multi-level marketing systems

Defendant Le Xuan Giang was identified as the head who established Lien Ket Viet Company; at the same time, this defendant is also the Chairman of the Board of Directors and General Director of the Military Medical Equipment Corporation Joint Stock Company.

The business items of Lien Ket Viet company are quite poor, only a few cleaning machines, health care machines and functional foods and are conducted in the form of multi-level marketing to defraud consumers.

In April 2014, Le Xuan Giang signed a contract with Nguyen Thi Thuy to hire the "Business Management, Development, and Sales" Group so that Thuy's group could carry out sales promotion tasks.

Specifically, this group is responsible for organizing the development of the business system of Lien Ket Viet Company, consulting on customer attraction, organizing events (this cost is paid by Giang); consulting on the implementation of trade promotion programs, advising on development strategies, business methods...

To carry out the work, Thuy's group was given a code to lead the entire affiliate business system. These affiliates are actually people who pay to buy product codes under the multi-level form of Lien Ket Viet.

This group also has exclusive rights to the collaborator system, and enjoys permanent benefits in the system. To carry out the above tasks, defendant Giang's company must pay Thuy's group 25 million VND/month and 300,000 VND for each product code generated in the Lien Ket Viet Company system.

Impersonating a Ministry of Defense enterprise, receiving fake certificates of merit

After a period of time allowing Thuy's group to develop the market with a multi-level marketing network covering dozens of provinces and cities, in June 2015, Le Xuan Giang appointed Nguyen Thi Thuy as Deputy General Director in charge of the company's business.

The ceremony to receive fake certificates of merit set up by the Lien Ket Viet Leadership Board - Photo: lkv.com.vn

When they had the title, Thuy and the group members became more reckless in their business activities, pretending to be a business under the Ministry of National Defense, and loudly organizing the reception of certificates of merit from the Prime Minister, which were actually forged by the defendants... to create prestige to fool the people.

In addition, Thuy wrote propaganda scripts including promotional and competition programs such as: Great Victory Rose, Humanity Rose, Success Horse... to promote the payment of commissions at record high levels, even giving house and car rewards... to agents.

In fact, these huge bonuses are just taking money from those who pay into the system later to pay commissions to those who pay first. Thuy also determined to attract participants to her multi-level marketing system with a commission rate of up to 65%, exceeding the Government's regulation of 40%.

Defendant Le Thanh Son is advertising for the company on television.

From these expansions, Thuy organized a series of conferences, seminars to promote and expand the network to 21 provinces and cities across the country, attracting and enticing many people to buy product codes and pay money to appropriate them. In addition to the headquarters in Hanoi, the company also has a branch in Ho Chi Minh City and representative offices in 19 provinces and cities.

During the investigation of the case, the police determined that from June 2014 to July 2015, Thuy and the group members Trinh Xuan Sang, Le Thanh Son, Nguyen Xuan Truong, and Vu Hong Dung developed a giant multi-level system with more than 45,000 participants, with a total revenue of over 1,900 billion VND.

Notably, most of the individuals who participated in purchasing the product codes did not receive the goods but instead accumulated bonus points to receive commissions according to the instructions from Thuy's group. Through system development, this group received remuneration and commissions of up to nearly 44 billion VND.

When the investigation agency stepped in, the total balance in Lien Ket Viet's account was only over 45.5 billion VND. The investigation agency determined that the defendants had used multi-level marketing business activities to defraud over 1,900 billion VND.

According to Zing