Citizens' Issues
MLM companies try forex deals, commodities training packages to lure new members

Hyderabad-based Variety Consultancy promises 15% return on investment per month for buying its forex and commodities training packages

Even as multi-level marketing (MLM) schemes such as Speak Asia and Tycoon Empire International Ltd are under the regulatory scanner, numerous such schemes continue to target gullible investors. Despite their exposure by Moneylife and regulators coming down on them, several MLM companies are still trying to sell the forex income dream.

One such company is Hyderabad-based Variety Consultancy, which promises 15% income on the principal 'invested' for every month for 14 months, and is selling forex and commodities training packages. It also promises additional earnings on referrals—a typical trademark of any pyramid scheme.

The company sells training and educational products, which can be used to learn and trade in foreign exchange (forex) and commodity trading. Its basic package costs Rs10,000 which the company says helps to "develop an understanding of basic trading techniques and risk control." The 'Silver' package provides basic to advance training along with practical training on a live forex trading platform, costing Rs1 lakh, while the 'Golden' package costs Rs2 lakh. It claims that the 'Golden' package provides 80 plus forex training videos, daily training classes, live forex training in its chat room for one year and daily trade reviews and mobile alerts.  

Experts say that schemes promising such extraordinary returns work on unsustainable business models and are bound to collapse, giving investors a run for their money. In the past, companies such as Stock Guru India and Tycoon Empire, promising similar returns, have duped thousands of investors. In fact, Variety Consultancy has not mentioned where it would be investing the collected money. This raises more doubts on the scheme.

According to Variety Consultancy's scheme, on investment, you are eligible for 15% returns on the principal for 14 months, regularly. This is dubbed 'commission income'.

On getting more investors to invest in the same plan, the company guarantees 'referral' income. This is purely based on the number of references generated by you. As soon as any reference comes under you, then you will get 10% of the principal amount invested by the person being referred. Incidentally, there is no cap on the number of references under you.  

The catch here is that the income on the principal decreases as level of your down line increases. So in level one, you get 4% income of the principal amount of your down line, in the next level it comes down to 2%. This goes to level 25, where the income would be just 0.25%.

Strangely, the company also promises giving regular income on your down line for 14 months. Again the income decreases as the level increases.

Moneylife had reported on how websites providing "stock option tips" have been luring investors by promising them returns as high as 100%, on investing in options and futures. They have found the legitimate options & futures trading market of the National Stock Exchange (NSE) a happy hunting ground for their shoddy business. See: Websites providing 'stock-options tips': By all looks, another huge scam in the making:.

A few states like Kerala and Tamil Nadu have started to curb such MLM and Ponzi schemes. Market observers say that the appropriate regulator and other state governments should act on such schemes before they dupe investors.

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COMMENTS

Kris

6 years ago

Very serious allegation against Amway

August 19, 2011 Manorma News TV Report.

http://www.manoramanews.com/cgi-bin/MMOn...

Wayanad Police Chief receives threatening letter.

The S.P of Wayanad (KERALA) , Mr. Jayanath received a threatening letter yesterday. Though the letter admires him for his action against Money chain companies, he was threatened not to proceed with investigation against Amway. The letter asks him not to bite Iron as it would cause loss of teeth.
The Police chief contacted the DIG and as per his advice a case has been registered. The Police have received clues about the origin of this letter and they have gone to Manjeri for enquiry.
The Manorama news further says that though all the Network Marketing companies were proceeding with court cases, Amway was indulging in "pressure tactics" only.

REPLY

seema

In Reply to Kris 6 years ago


Amway knows very well that if they go to a court of law they won't get any relief. That is why they are indulging in pressure tactics only.

Kris

6 years ago

Police conduct raid on CNI offices:

Creative Network International

[The national head quarters of the CNI is based at Bangalore and is controlled internationally from Malaysia.]

The New Indian Express:

http://expressbuzz.com/states/kerala/pol...

REPLY

kris

In Reply to Kris 6 years ago

MLM FRAUD - GREENCO SECURITIES

WEBSITE VANISHED [WWW.GREENCOSECURITIES.COM]


After the Police raid and sealing of Office, promoters of Thrissur (Kerala) based fraud MLM company are absocnding. One of the Chief promoters of this fraud company is the wife of a Policeman !

(Ref: MATHRUBHUMI dated 20.8.2011)

kris

In Reply to Kris 6 years ago

Money chain fraud

L I S case

More investigation Required: Police

It is a 332 crore Money chain fruad says prosecutor to the court

http://www.mathrubhumi.com/online/malaya...

LIS CASE VICTIMS- Please do someting to get our money back

http://www.consumercourt.in/investment/4...

Efforts to suppress LIS case was one for the reasons for all the future frauds says ADGP Mr. Senkumar IPS

http://www.thesundayindian.com/article_p...

It was on May 11, 2006 Police raided LIS offices. Then Hindu report:

http://www.hindu.com/2006/05/11/stories/...

“Double your money in just seven weeks” can be one of the most luring captions and it worked wonders for the LIS Deepasthamabham project. The agency with its headquarters in Ernakulam succeeded in attracting more than 1 lakh investors until their office was raided and sealed by Investigation Officer T P Senkumar.

http://ibnlive.in.com/news/big-fat-money...

Kris

In Reply to kris 6 years ago

The New Indian Express Report

Accused bribed top political party to derail LIS probe: Govt. to Court

The accused in the LIS financial fraud case have paid an amount of 1 crore rupees to a leading political party through its newspaper unit to derail the investigation in the case. ………………………………………….

Kishore N

6 years ago

MLM - FRAUD

NANO EXCEL BRIBERY CASE:

Govt accused of protecting corrupt

THE FINANCIAL department of Kerala is trying to provide shelter to a commercial tax official against whom the vigilance court has ordered a probe, VS Sunilkumar, MLA, has alleged.

http://www.cityjournal.in/Newspaper/2011...

Sony

6 years ago


Why the Central Government is not coming up with stringent rules to curb these type of financial frauds ?

kunwar

6 years ago

ha ha..khisiyani billi khambha nonche..LOLZ

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