RingID embezzled Tk 212cr in 3 months

After Evaly, Dhamaka Shopping and Eorange, the jig seems to be over for another unscrupulous company, the social networking platform RingID, after one of its directors was arrested yesterday.

The police arrested Saiful Islam from the capital's Gulshan following a case filed on September 30 by an aggrieved user of RingID at the Bhatara Police Station under the Digital Security Act and Multi-Level Marketing Control Act.

Saiful is the brother of Shariful Islam, the managing director of RingID, which was established in July 2015 as a social networking platform with a dizzying range of features including live broadcasting, voice and video calls, instant messaging, stickers, media cloud, newsfeed, secret chat, multimedia sharing, online wallet.

Shriful's wife, Ayrin Islam, is the co-founder and chief executive officer of Ring ID, which had sponsored cricket tournaments a few years ago, like Evaly.

Ayrin and Shariful were arrested earlier on December 28, 2016 following a case filed by the Bangladesh Telecommunication Regulatory Commission over dues pertaining to revenue-sharing and licence fees from their interconnection exchange and international gateway operations.

They later secured bail from the High Court and left for Canada.

The two have been accused in the case along with 22 others, which include officials and agents of RingID.

In the last quarter of 2020, RingID pivoted into a business model that exploited the affiliate marketing programme, which is rather popular globally to drive sales and generate significant online revenue.

Affiliate marketing is a process by which an affiliate earns a commission for marketing another person's or company's products. Typically, the affiliate promotes a product and earns a piece of the profit from each sale made.

Often, directing people to a company's site is enough to get the affiliate the commission.

RingID posed as an affiliate and to maximise its commission from companies, it dipped into its sizeable pool of users for clicks.

It tempted users with two types of memberships: Silver and Gold.

For Silver membership, one has to pay Tk 12,000. The user can then earn up to Tk 7,500 per month by clicking on about 50 advertisement links.

For Gold membership, one has to pay Tk 22,000. He/she can then earn up to Tk 15,000 a month by watching about 100 advertisements per day.

Between May and July, RingID collected a total of Tk 212.3 crore by selling such memberships, said a press release from the Criminal Investigation Department (CID) of the police, which made the arrest.

If the existing members brought in newer ones, they were rewarded too, giving RingID the vestige of notorious multilevel marketing companies like UniPay2U, which had collected more than Tk 5,000 crore in a little over a year of its operation a decade ago.

Besides, like e-commerce sites, RingID was also conducting transactions through e-wallets in the name of selling various products at unusual discounts, the CID said.

In the primary interrogation, Saiful, who was placed in a two-day remand yesterday, admitted that RingID did not have the authorisation to collect such deposits from users, the CID said.

In the time of the pandemic, many were thinking of making easy money, which is why they fell for RingID's offer, according to Rezaul Masud, special superintendent of the CID's Cyber Intelligence and Risk Management cell.

"We just got the amount for three months. If we look into the amount they collected for the full year, the amount will be four times higher," he told The Daily Star yesterday.

About one lakh purchased RingID's membership.

"If someone gets Tk 7,000 a month from investing Tk 12,000, why would people not jump in? Their business has a kind of multi-level marketing model with fraudulence," Masud added.

In this vein, Ankhi Begum, the aggrieved user and whose complaint with the police led to Saiful's arrest, and her family had put in upwards of Tk 20 lakh in RingID.

They are yet to see any returns on their investments.

Two more cases have since been filed against RingID with Jashore's Kotwali Police Station, said Tajul Islam, officer-in-charge of the police station.

The Bangladesh Bank has already been requested to freeze RingID's bank accounts to curb money laundering.

An inquiry team of CID is also working in this regard.

Contacted, Ayrin told The Daily Star in an e-mail reply that the allusion of the Ponzi scheme to RingID's 'Brand Promoter Model' is incorrect.

"The 'Brand Promoter Model' is like the Affiliate Marketing Programme that in fact very popular worldwide."