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Pyramid selling groups are falling afoul of law enforcement officials with increasing frequency, top officials said.

Officials from the State Administration for Industry and Commerce (SAIC) and the Ministry of Public Security said on Tuesday they would jointly wage a month-long campaign against illegal pyramid selling groups starting on Monday.

Zhong Youping, vice-minister of the SAIC, said pyramid selling appeared to be on the rise and spreading from prosperous coastal areas to the less developed western part of the country as well as other rural areas.

"They often act under the guise of 'direct sales' or 'chain stores'," he said.

"And their illegal deeds are often connected with illegal fund-raising and swindling."

The main focus of the campaign is to tackle several large pyramid selling organizations that cover extensive regions and involve huge numbers of people and large amounts of money.

Activities like luring people away from where they live and then restricting their freedom after they join the group and violent confrontations with government workers will be severely punished.

Zhong said confrontations between pyramid selling groups and law-enforcement officials had been intensifying.

He said 54 law-enforcement officers from 13 provinces had been injured in clashes with members of such groups since the beginning of last year.

For example, local police and industrial and commerce bureau staff in Siping, Jilin Province, were besieged and attacked by more than 140 members of a pyramid selling group during an attempted crackdown.

Zheng Shaodong, assistant to the minister of public security, said illegal pyramid selling had absorbed about 40 to 50 billion yuan ($5.3 billion-$6.6 billion), posing a huge threat to the country's economic security.

The SAIC reported 15 large cases of pyramid selling last year, each involving more than 100 million yuan.

The largest one involved a Shandong Province-based group selling cosmetics. It had members from 20 provinces. The case involved more than 500,000 people and more than 2 billion yuan.

(China Daily July 12, 2007)