Taiwan-born celebrity couple, Lin Rui-yang (right) and Chang Ting (left). Photo: IC photo.

Chinese celebrities including Lin Chi-ling and Tao Hong may face fines given their involvement in the Lin Rui-yang case that Lin's company, Shanghai Dowell Trading Group (Dowell), is under investigation on suspicion of facilitating a pyramid scheme, experts said.

According to the company's account on Douyin, a number of Chinese celebrities have endorsed its products, including A-list cinematic actress Lin Chi-ling, who once promoted the company's cosmetics, and Tao Hong, a well-known actress, who was identified as one of the shareholders in the enterprise.

"These celebrities that have engaged in Lin Rui-yang case may be fined, but we should firstly clarify the nature of these celebrities' roles during the promotion," Chen Yinjiang, deputy secretary general of the Consumer Protection Law Association of the China Law Society told the Global Times on Wednesday.

Chen said that Tao Hong, as a shareholder of the company, if she only made investment rather than being involved in the firm's daily operations, there is less likelihood that she violated the law.

"If a celebrity promotes a product, he or she must know about the performance of the recommended product and try it out for themselves. After using the company's products, many consumers have skin problems, so Li Chi-ling, who endorsed the product, should be held responsible," Chen said.

Lin Rui-yang's company is under investigation on suspicion of facilitating a pyramid scheme. Media reported that the market regulation authority of Yuhua district in Shijiazhuang city, capital of North China's Hebei Province, has been investigating Dowell since June 5, 2021 after receiving concerning public reports. It established a special group of 17 experts and dispatched nearly 400 officials to undertake a comprehensive investigation.
 
Chen said that if the company's alleged pyramid scheme is true, those celebrities involved will have to forfeit their endorsement fee or even face fines if they knew or should have known about the company's illegal business practices.

"Authorities should also improve related laws and regulations in order to ensure that the celebrities' profits from endorsement activities are in line with their responsibilities undertaken," Chen added.

Global Times