Pyramid sales generated profits for investment firm, court told

Three executives of an investment company that claimed it could earn clients large profits on the sales of products including sheep placenta extracts and skincare items, yesterday denied it was a pyramid scheme.

The company, Perfect Life Global, claimed it generated profits by reselling factory goods. But prosecutors claim the only real income came from investors' money.

The accused, Stephanie Leung Fung-yan, 28, Sunny Chan Ching-chung, 47, and the company's boss, Sigmond Yu King-ming, 40, are standing trial at the District Court for conspiracy to defraud clients.

The court heard that more than HK$3 million in cash was seized by police at a flat jointly rented by Leung and Chan at Grand Plaza Apartments in Kornhill Road in August 2004.

Investor Ng Suet-hung, 39, told the court the company only accepted cash. She invested HK$66,000 after being introduced by a friend and attending promotions in June 2004 that promised high returns. Ms Ng, a housewife who has lived in Hong Kong since 2000, said people 'sang and celebrated' at the meeting.

'A lot of people had made money. Some people went up saying a certain amount of money had been invested and now a certain amount had been made,' she said.

She added that some claimed investments of 'a few hundred thousand dollars' could make profits of up to HK$80,000 to HK$100,000.