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49 jailed in auction scam to solicit fees

FORTY-NINE people who defrauded 800 collectors in an auction scheme out of 13 million yuan (US$1.9 million) have received jail terms from 12 and half years to 14 years for fraud.

Qingpu District prosecutors said the fraudsters opened an overseas shell company that was made out to be a licensed auction house based in the United Kingdom. They recruited people to impersonate specialists to find and persuade collectors to sell their items at “auction.”

Prior to the auction that was actually never held, collectors were charged fees for their items being “exhibited.” Then, they would be told that their items hadn’t sold. The items were returned but the so-called fees went into the pockets of the scammers, prosecutors said.

In one case, a man surnamed Wei, who owns a ruby family treasure, was cheated out of 40,000 yuan. He said he was told by a firm calling itself Shanghai Qiancang Exhibition Company that his item would fetch at least 100,000 yuan at auction.

Wei paid 20,000 yuan for his ruby item to be showcased at a Singapore auction. One month later, he was informed that his item was not sold, but he could pay another 20,000 yuan to be entered into a UK auction. Again, there was no actual sale, at which point Wei realized he might have been cheated and he contacted police.

Investigation found Chen Xiudong, who had worked as manager for a local auction house, set up Qiancang in 2015. Later, he registered an overseas company called UK Phillips Auction House. It was a shell company. Chen recruited people to pose as specialists and find victims.


 

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