Authorities in China have frozen $94 million of TST Tin’Secret’s assets, on suspicion the business is conducting a pyramid scam.
Consumer concerns in Hebei province, in northern China, reportedly prompted the freeze.
TST Tin’Secret and its parent firm, Shanghai Dowell Trading, are both names I’m unfamiliar with.
The MLM firm was formed by Taiwanese actress couple Zhang Ting and Lin Ruiyang in 1996.
A short check finds TST Tin’Secret operates in China, Malaysia, and Singapore.
According to a statement released by “the market regulator in Shijiazhuang;
The government has asked the People’s Court to take preservation measures by the law since it is suspected that pyramid scheme monies were transferred to or hidden within financial institutions; the matter is still being investigated.
On the surface, it appears they have proven that TST Tin’Secret is a pyramid scam.
In China, however, the exact meaning of this is unclear.
If TST Tin’Secret were a pyramid scheme, one may conclude that most of its consumers are also distributors because of the nature of its cosmetic items.
In reaction to the freeze, TST Tin’Secret hailed Chinese officials for confiscating their assets.
To the Administration for Market Regulation of Shijiazhuang Yuhua District, our sincere appreciation; with their help, our business was able to mitigate any potential threats and is now functioning smoothly.
The appropriate divisions may count on full support from our organization.
It may sound strange to Americans, but in China, rallies against the government are quite effective.
Particularly if you are a married couple from Taiwan operating what looks to be a profitable business in mainland China.
According to the South China Morning Post
In 2017 and 2018, Shanghai Dowell Trading paid the most yearly taxes in the Qingpu District of Shanghai; in 2018, the firm claimed to have paid 2.1 billion yuan (about US$330 million) in taxes.
A tax bill of $350 million indicates that TST Tin’Secrets has a sizable revenue stream.
A common administrative penalty for such infractions is a monetary fine. We’ll be on the lookout for any new information.