Beijing police have arrested 14 key suspects in connection with the capital's biggest-ever pyramid selling case, official sources said on Sunday.

Police have also seized their private cars, real estate property and part of their illicit gains, said the Beijing Municipal Public Security Bureau.

The 14 were in charge of pyramid selling in Yilin Wood Company, which swindled more than 1.6 billion yuan (206 million U.S. dollars) from about 20,000 people across the country since April 2004, the bureau said.

Police have received reports from 4,500 people who were cheated in the case.

The company cheated investors by promising them high returns on sales of woodland. It used a pyramid selling model, in which one salesperson recruits other sales people and they then recruit more, according to the bureau.

Last December, nine managers of the company were arrested.

Even though pyramid selling is accepted in some countries, it was banned in China by a government regulation in 1998. Authorities said such schemes have become a synonym for cheating and hoodwinking in China.

People guilty of organizing and running pyramid schemes involving a large number of people face prison terms of five years or more and can be ordered to repay up to five times the profits generated by their illegal business operations, according to Chinese law.

Source: Xinhua