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Quest for gold turns nasty

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A case study on Microsoft.com is unwittingly promoting a company which has been accused of operating a pyramid scheme targetting people in south-east Asia and Africa.

This page on Microsoft's website explains how Hong Kong-based GoldQuest International Ltd made big savings by moving to Windows Server 2003. The page proudly trumpets GoldQuest's achievements and "500,000 active customers in 120 countries".

"GoldQuest has grown into a ecommerce powerhouse, generating 70 per cent of its $200m annual turnover online," the page gushes. Microsoft claims it has saved the company $82,000 a year in IT costs and helped it increase revenue by $10m a year.

The only trouble is, GoldQuest has been accused of operating a form of pyramid-scheme targetting gullible folk in some of the world's poorest countries.

The company, based in Hong Kong, sells "commemorative" gold and silver coins. But people are encouraged to gain commission by getting more people to sign up. If you can sell coins to two other people, who in turn must recruit two more, then you start receiving commission.

A spokesperson for the Central Bank of Sri Lanka's legal department told The Register that it was investigating GoldQuest with the assistance of the police.

A campaigner in Sri Lanka told us: "It's a nasty scheme. I first heard about it in 2003 and even quite educated people have fallen for it." He explained that the company had also targetted Ethiopia, Sudan and Tanzania.

Sri Lanka's central bank has made four separate appeals to the public to avoid such schemes.

In Bhutan, the Royal Monetary Authority reportedly warned the public about GoldQuest, saying: "The pyramid will collapse eventually when more members cannot be found, besides it does not generate any productivity."

According to Iranian state media, authorities in the country recently arrested "some key members of this group," while Iran's central bank declared GoldQuest activities were illegal and against Islam.

A spokeswoman for Microsoft told us that GoldQuest is "managed by a partner" and the case study was prepared by a partner for the launch of Windows Server 2003.

We asked GoldQuest for comment, but it did not return our calls.

More details here, here, and here. ®

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