tp-alan_kippax3

RCMP have charged 44-year-old Alan Kippax of BIM Corp. over an alleged Manitoba pyramid scheme. ((CBC))

Thirteen people involved in an Ontario-based network-marketing business have been charged in an alleged pyramid scheme that illegally "recycled" funds between investors, the RCMP said Thursday.

Seven Manitobans, five people in Ontario, a B.C. woman and Mississauga, Ont., corporation called Business in Motion International Corp. (BIM) are charged under the illegal gaming and betting section of the Criminal Code, police said.

The RCMP investigated complaints about the company that surfaced in the community of Steinbach, south of Winnipeg. Police said the charges related to the company's activities there between spring 2008 and fall 2009.

Cpl. Chris Lambert said the investigation focused on business opportunities offered by the company and its agents. Large meetings for prospective clients were held in Steinbach and were advertised by word-of-mouth starting in summer 2007, police said.

'The business plan that they proposed, we're alleging that was an illegal lottery.'—RCMP Cpl. Chris Lambert

According to Lambert, they were very well attended at first, with a "significant portion" of the community of about 12,000 people coming out to hear BIM's pitch.

People attending meetings were asked to pay a $3,200 entrance fee to get in on the scheme Lambert said. Over time, that fee grew to about $3,600, he added. 

A 2009 CBC News investigation into BIM showed the company's main product was a travel package promising vacation deals called the UltraLife Club. A $3,200 membership in BIM came with a pitch that thousands of dollars in commissions could be earned by becoming a distributor and selling to others, CBC reported.

"The business plan that they proposed, we're alleging that was an illegal lottery," Lambert said.

The money was allegedly "recycled" to participants in the scheme, which depended on the continued recruitment of new clients.

"The idea is, you were supposed to go in there with no preconceived notions," Lambert said.

The RCMP used various techniques in its investigation, including embedding undercover officers within the scheme, Lambert said.

The suspects in the case made an initial court appearance in Steinbach on Wednesday.

RCMP said their investigation focused solely on the Steinbach complaints. Lambert couldn't say if other BIM investigations are underway elsewhere in Canada.

With files from the CBC's James Turner