Beijing-based Gaopeng.com, a group-buying portal set up on March 1, was going strong until a “lucky draw” saw it become mired in allegations of fraud that damaged the company’s reputation and tarnished the booming industry.
The company is owned by US-based Groupon.com and China’s Tencent.
Gaopeng organized an online “lucky draw” on May 4, with two popular iPhone 4s to be given as prizes on May 10. Word of the promotion flashed online and more than 110,000 netizens forwarded the news via micro blogs.
The winners were to be selected at random. However, when their names were announced on Tuesday, sharp-eyed netizens recognized that the winners were Gaopeng employees (their e-mail addresses gave them away).