8 arrested for suspected involvement in 'Ponzi-like job scams'

SINGAPORE: Eight men have been arrested for their suspected involvement in two separate series of "Ponzi-like job scams", the Singapore Police Force (SPF) said on Sunday (Mar 20).

The arrests were made during the police's anti-scam enforcement operations.

Five men aged between 18 and 26 were arrested during an operation conducted between Mar 8 and Mar 18, while the other three, aged between 26 and 30, were nabbed during an operation that was carried out on Mar 17 and Mar 18, SPF said in a news release.

Investigations into both series of scams are ongoing.

E-COMMERCE AFFILIATE BUSINESSES

The five men arrested in the first enforcement operation are suspected of being involved in perpetrating Ponzi-like job scams involving an e-commerce affiliate business (EAB).

Another two men and seven women, aged between 18 and 72, are also being investigated for their suspected involvement in the job scams.

The police received several reports between December 2021 and March 2022 about victims receiving unsolicited WhatsApp messages and Facebook or Telegram posts with advertisements promoting highly paid part-time affiliate marketing related jobs.

The scammers would offer fake online jobs that required the victims to complete easy tasks such as making online purchases, the police said.

In order to perform more job tasks and earn their commission, the victims were directed to recruit more members to upgrade their membership status.

"In most cases, the victims would be convinced that it was a legitimate job as they would receive commissions and profit during the early stage of their memberships," said the police. 

"Victims would realise that they had been scammed when they did not receive further commissions or were unable to make withdrawals from their member accounts."

During the 11-day operation, officers from the SPF Commercial Affairs Department mounted simultaneous islandwide operations and arrested the five men. The other two men and seven women were traced and investigated for their suspected involvement in the EAB-related job scams.

Preliminary investigations revealed that the EAB is believed to be running Ponzi-like schemes where the new job seekers’ money was used to pay the promised commissions to existing job holders. 

Four of the men arrested are believed to have facilitated the schemes by disclosing their Singpass login details and their own bank accounts to unknown people "for easy money", said the police.

Their Singpass details were then used by the syndicate to open corporate bank accounts that were used to launder proceeds of cheating. Preliminary investigations also revealed that the scammers would change the URLs for the EAB website to continue to perpetrate the job scams.

The four men will be charged in court on Monday with the offence of disclosing their Singpass login details under the Computer Misuse Act. First-time offenders who are convicted can be fined up to S$10,000, jailed for up to three years, or both.

Investigations against the other three men and seven women are ongoing.

MULTI-LEVEL MARKETING STRATEGY

The three men arrested in the second operation were allegedly involved in a series of scams related to a bogus company that purportedly ran a Ponzi-like scheme using a multi-level marketing strategy. 

On Mar 17, the police received information about an emerging job scam platform where users received unsolicited messages on Telegram, Facebook or Instagram posts, or came across online advertisements promoting highly paid affiliate marketing related jobs.

The job scam portal purports to be an e-commerce service platform that specialises in providing marketing services for major e-commerce websites, improving the popularity and sales for shopping websites, and solving the problem of low footfall on shopping websites.

It also claimed to have created more than 5,000 jobs in nine countries around the world.

The scammers also offered fake online jobs which required the job seekers to complete easy tasks such as making purchases with various e-commerce companies. 

In order to perform the job and earn a commission, the job seekers were directed to sign up for free membership accounts on websites provided by the scammers.

To boost the memberships, the platform provided additional rebates when the existing member recruited new members, and when a certain number of tasks were achieved by the existing member or the newly recruited members.

After signing up for the free membership, the job seekers would be asked to top up their account maintained on the platform before they could start performing the job to earn commissions. All top-up and withdrawal transactions were performed using cryptocurrency. 

"In most cases, the job seekers were convinced that it was a legitimate job as they would receive commissions and profit during the early stages of their memberships," said the police. 

"They would realise that they had been scammed when they did not receive further commissions or were unable to make withdrawals from their member accounts."

Officers from the Commercial Affairs Department mounted simultaneous islandwide operations on Mar 17 and Mar 18 and arrested the three men. 

The offence of fraud by false representation of position not connected with contracts for goods and services carries a jail term of up to 20 years, a fine, or both.

The police urged job seekers to be wary of online job advertisements that promise the convenience of working from home and being paid a high salary for "relatively simple" job responsibilities. 

Legitimate businesses will not require job seekers to make upfront payments to secure job offers and earn commissions or utilise their own bank accounts to receive money on the businesses’ behalf.

"These acts are common ruses used by scammers to lure individuals into participating in their schemes or scams," SPF said.

To avoid becoming involved in money laundering activities, members of the public should always reject requests to use their personal bank or cryptocurrency accounts to receive and transfer money for others, the police said.