Source： | Date：2020-08-06
China Banking and Insurance Regulatory Commission, Ministry of Industry and Information Technology, Ministry of Public Security, Ministry of Commerce, People’s Bank of China, and State Administration for Market Regulation remind you that:
Recently, some third-party platforms have promised to refund high proportions or even all of consumption expenditures and franchise fees, etc. under the banner of “entrepreneurship” and “innovation” and using gimmicks such as “refund costs for shopping”, “consumption equals earning”, and “you shop, I pay”, to attract consumers and merchants to invest. This type of “consumer rebate” differs from the normal rebate for promotion of merchants and has big risks:
Firstly, it is difficult to achieve high rebates. The rebate funds are mainly from commodity premiums and expenses paid by members and franchisees, and most platforms do not have legitimate real economies or income to match the returns promised by them, therefore, capital operation and high rebates are not sustainable.
Secondly, it is difficult to guarantee fund security. Some platforms absorb the funds of the public and merchants through “prepaid consumption” and “top-up”, etc. online or offline. As a result, massive funds are controlled by them, and there is the risk of transferring funds and running away with the money.
Thirdly, the business model has a risk of legal violation. Some platforms fabricate profit prospects, promise high rebates, and inspire or acquiesce in members or franchisees fabricating commodity transactions and directly paying a certain proportion of fees to the platforms to seek high rebates, while the platforms achieve the purpose of rapidly absorbing the funds of the public in this way. Some platforms, using the pyramid scheme approach and the so-called “dynamic income” as bait, even require participants to pay entry fees and develop lower-level participants to obtain commission. The above behaviors of the platforms and participants already have the characteristics of illegal activities such as illegal fundraising and pyramid schemes.
The operation mode of the platforms goes against the law of value, and participants will face serious losses if the financial chain breaks. According to the relevant provisions, participation in illegal fundraising is not protected by law, and participants shall assume the risk and responsibility by themselves; participation in pyramid schemes is an illegal act, and participants shall assume the corresponding responsibility according to law. The public and merchants please raise vigilance and enhance risk prevention awareness and identification abilities to avoid the damage to interests. And please actively reflect to related authorities any clues of offenses and crimes you may have.
Source: Website of China Banking and Insurance Regulatory Commission