Chinese supplement firm Quanjian’s founder faces criminal detention with 17 others amid false advertisements allegations

By Tingmin Koe contact

- Last updated on GMT

Quanjian's official website shows the picture of founder Shu Yu Hui.
Quanjian's official website shows the picture of founder Shu Yu Hui.

Related tags: false advertising, MLM, anti-cancer

Eighteen employees at Chinese supplement firm Quanjian, including founder Shu Yu Hui, are under criminal detention amid alleged involvement in fake advertising for its multi-level marketing (MLM) activities.

Besides Shu, a doctor surnamed Zhu was also amongst those detained, Tianjin police said on January 7. 

"(On) January 1 2019, police from the Tianjin city has conducted investigations on Quanjian Natural Medicine Science & Technology Development for its suspected involvement in organising (and) heading MLM activities and (putting up) fake advertisements," ​Tianjin police said using their official Weibo​ account.

Shu, 51, was detained as of January 7, while Zhu was investigated for practicing without license on January 2.

Besides the 18 of them, two more employees were released on bail, the police added. 

The company has become the subject of media attention lately for a spate of scandals, including allegations of making dubious claims in its product advertisement, such advertising cancer-curing herbal remedies.

Quanjian’s businesses span across the healthcare, health supplements, Chinese medicine, finance, and sports industry. It is also the financier of Tianjin Quanjian Football Club.

Overseas operation

Quanjian also sells its products in places outside of China, including Singapore and Malaysia.

NutraIngredients-Asia​ understood that Quanjian Singapore previously sold non-food products, including sanitary napkins in Singapore, but had stopped importing products from Quanjian over a year ago.

According to an anonymous source, unless one is a member, one will not be able to buy products from Quanjian.

Timeline of saga

The saga began when a healthcare website Clove Doctor (Ding Xiang Yi Sheng) published information on Quanjian’s practices in late December.

Part of the content included the story of Zhou Yang, a four year old Chinese girl who passed away from cancer after her father had forsaken medical treatment and fed her with supplements from Quanjian instead.

The family first got into contact with Quanjian after their story was shown on China Central Television (CCTV).

An employee from Quanjian contacted the girl’s father Zhou Er Li and brought him to visit Shu.

Zhou subsequently paid RMB$5,000 (US$730) for a bottle of essential oil, a sachet of powdered beverage and a packet of Chinese medicine, which it is claimed did not contain details of the product formula.

Zhou said he was told that those were “anti-cancer drugs” for his daughter and that his daughter no longer needed medication or chemotherapy.

Subsequently, Zhou requested his daughter to be discharged from the hospital despite the doctor’s objection.

His daughter’s condition worsened after consuming Quanjian’s products for over two months.

It was at this point of time that Zhou was bombarded with numerous phone calls, asking if his daughter had indeed recovered from cancer.

Unknown to Zhou, it turned out that a video titled “Zhou Yang’s germ cell tumor has been treated by Quanjian’s secret formula” had been circulating online.

Zhou sued Quanjian and demanded the company to apologise.

Zhou also claimed to have received a call threatening him to drop the lawsuit, as there were several millions of people working for Quanjian and that he would become their enemy if he refused to do so.

Zhou eventually lost the lawsuit in 2015, after the court deemed that there was insufficient information to prove that information circulating online came from Quanjian.  

Rebuttal

In a notice​ posted on its official website, Quanjian refuted the claims made by Clove Doctor.

It said that Clove Doctor had “published a false article, (and) had made used of false information gathered from the internet, which amounts to a slander against Quanjian, (and had) caused the public to have a skewed understanding of Quanjian.”

“With regards to the false report on Zhou Yang, Quanjian has never officially publicised information on (us) providing treatment for her.”

It asked Clove Doctor to immediately remove its article and to publish an apology.

It added that since 2005, the firm has invested an average of RMB$50m (US$7.29m) on corporate social activities and had donated more than RMB$500m (US$72.9m) thus far.

Clove doctor sued

In response to Quanjian, Clove Doctor insisted that it would not remove the article.

In addition, it said that it had received a lawyer letter from Quanjian and was prepared to seek legal recourse.

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