Zhunrize, launched in 2013 is a shopping and savings portal and offers affiliates a replicated storefront, which the company has branded “ZhunCity”. The shopping portal starts at $99 and $30 a month, up to $3,000 and $100 a month.
According to a SEC Press release:
“On September 22, 2014, the Securities and Exchange Commission filed a civil injunctive action in the Northern District of Georgia against Zhunrize, Inc. (“Zhunrize”) and its CEO, Jeff Pan (“Pan”). In connection with the filing of this action, the Commission obtained a temporary restraining order against the defendants and an order freezing all of defendants’ assets.
The Commission alleges that Zhunrize, an Atlanta-based multi-level marketing company, and Pan have been operating a fraudulent pyramid scheme that has raised over $100 million from investors worldwide.
According to the Commission’s complaint, Zhunrize purports to be a legitimate multi-level marketing business by which members purchase online stores and then sell merchandise through them, while earning commissions on products purchased by their customers and through store sales to other members and hosting fees paid by those members.
In fact, the company is operating as a pyramid scheme because its commission structure is based on the continual recruitment of new members, with the