What is MLM?

MLM refers to the illegal behavior of organizers developing personnel to obtain wealth through the development personnel or requiring the developed personnel to obtain qualifications for joining on condition of paying a certain fee. The essence of MLM is the "Ponzi scheme," that is, the money of futurecomers to the previous ones.

MLM

MLM arises from

The national criminal law stipulates that organizations and leaders use the name of business activities such as sales of goods and services, and require participants to obtain qualifications by paying fees or purchasing goods and services, and form a hierarchy in a certain order, directly or indirectly based on the development of personnel. If the quantity is used as a basis for remuneration or rebate, to induce or coerce participants to continue to develop others to participate in, to defraud property, or to disrupt the economic and social order of pyramid schemes, they shall be sentenced to fixed-term imprisonment or imprisonment for less than 5 years and fined; if the circumstances are serious, they shall be punished for more than 5 years Term of imprisonment and fines. ^[3]

Organizations and leaders, in the name of business activities such as selling goods, providing services, and project investment, require participants to obtain qualifications for joining by paying fees or purchasing goods, services, and investment.

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In early 1996, the Guangdong Provincial Administration for Industry and Commerce first investigated and dealt with the illegal marketing of a "Shuang Ankang" rocker by a company in Dongguan, involving 28 provinces and cities nationwide with a value of 124 million yuan. At the beginning of 1997, the Yunnan Provincial Administration for Industry and Commerce investigated and dealt with the German "ace 88" online layer gaming activity. Those who participated in the event first had to pay 50 marks (RMB 300 yuan). MLM case. Order No. 10 of the State Council issued in 1998 prohibits any form of MLM business activities. From 1998 to 2001, Hainan Provincial Department of Industry and Commerce inspected and registered more than 50,000 MLM personnel, destroyed more than 1,000 MLM dens, and captured 280 MLM leaders. In the first half of 2001, industrial and commercial administrations across the country investigated and dealt with 1,219 cases of illegal pyramid schemes, terminated 1,183 illegal pyramid schemes, and cleared more than 110,000 participants. In 2001, when Premier Zhu Rongji inspected the work of the State Administration for Industry and Commerce, he stressed the need to thoroughly expose the essence of fraud in pyramid schemes and pyramid schemes in disguise, and to increase publicity and propaganda from the perspective of safeguarding the vital interests of the people. Eliminate the soil on which they depend. In 2001, the National MLM Office was established.

Focus on cracking down on "capital operation" MLM

On August 11, 2011,

The MLM sales target is mainly themselves, buying the company's products themselves, and promoting this sales method to the offline. In fact, the offline is mainly targeted at their relatives and friends.

Among the 141 virtual currency MLM cases searched online in the Chinese Judgment Documents, the latest judgment was made by the court on May 2, 2018. The number of such criminal cases has been increasing year by year. In 2014, the court ruled 5 cases, and since then, it has increased exponentially to 62 cases in 2017.
According to statistics, 141 virtual currency MLM cases involving MBI, M3 coins, dark coins, Asian coins, Stellar coins, Golden Edge shopping alliance electronic currency, Yangtze River international virtual currency, Qile bar, Weishi media electronic currency, dividend dot currency , Virtual gold coins, HGC, COA, LFG, SRI, bismall, AHKCAP, CPF, 100 million cents, K coins, R coins, Baichuan coins, K treasure, Zhongfutongbao, Hongtong coins, Rains electronic money, Global BlackRock No. 1 wealth management coin, Grassberg, BCI, M coin, Wing coin, EV coin, performance coin, FIS, U coin, ES, Tibetan treasure performance coin, Huiai electronic coin, Jianye electronic coin, subsidy coin , High Frequency Trading Coin (HFTAG), Happy Compound Coin, Quicklink Website Virtual Currency, World China Coin, Entcoin, CPM, Carat Coin, Extreme Coin, Wuhua Alliance Virtual Coin, Legg Mason E, China Coin, Mimi At least 65 kinds of names such as virtual currency, FIS, World Cloud United Cloud Coin, Live Currency, Vicat Coin, Markcoin, Charity Coin, Promise Coin, ATC, IPC, Central Currency, Five Elements, Huiai Coin, Sailing Currency, etc. "Virtual currency". ^[2]

These virtual currency MLM organizations have at least 15,655,622 members in the country.
According to the ruling documents, in the above-mentioned virtual currency MLM case, "Vicacoin" involved the highest amount, totaling 7 billion, and its global membership number was 10.77 million, the largest number. From the perspective of the development scale of MLM organizations in the country, the number of "Munco" (also known as World UnionPay and World Cloud Union network MLM platforms) MLM organizations has been down 4439449; the second is the "Dark Coin" MLM organization that has over 340 members Ten thousand people. ^[2]