Moneylife Events
Moneylife Foundation conducts seminar to help people avoid pyramid schemes

Almost every day, get-rich-quick, pyramid, multi-level marketing and Ponzi schemes try to dazzle the gullible to loot their hard-earned money. Ms Sucheta Dalal, Founder-Trustee, Moneylife Foundation, conducted a seminar to warn people to stay away from such fraudulent proposals

“Individual lawsuits are being registered and action is being taken against multi-level marketing schemes, but there are thousands of them which are still running,” said Ms Sucheta Dalal, managing editor, Moneylife magazine. She was speaking at a seminar organised by Moneylife Foundation.

Ms Dalal said that states like Kerala, Andhra Pradesh and Tamil Nadu have been active against fraudulent pyramid and MLM schemes, but police estimate that each state has more than thousand schemes going on. According to Andhra police, there are 10,000 schemes running there. Despite legal action and some court rulings, these schemes proliferate because the regulators are silent.

“Most countries like USA, UK, Singapore and The Netherlands have banned such schemes. India has the Prize Chits and Money Circulation (Banning) Act, 1978, which is the toughest law on paper, but since many influential people are associated with these MLM schemes, they get away with cheating people,” she said.

The 1978 Act is a Central legislation but is administered by states. However, in most cases, policemen and regulators are ensnared by the Ponzi schemes and hence, no action is taken. Moreover, very few complaints are registered until money is lost by investors, and by that time, it is usually too late.

Many MLM companies however, have a more complex model and offer a tangible product~ like Amway, Tupperware and Oriflame. Such companies usually have a global presence and persist for a long time. But apart from the top layer, none of the other investors make money.

Member of the audience talked about numismatic coin schemes and Gold Quest, an MLM scheme~ which promised high returns in gold or precious coins and took investors for a ride. “No coin is precious if it is not rare. If such coins are churned out by a factory and don’t have a market like for genuine collectibles, it is surely a fraudulent product”, Ms Dalal said.

Even though there have been lawsuits, most investors don’t get their money back. It is better to stay away from these schemes altogether~ rather than invest and repent, she said.

Even some insurance companies have started to sell their products through a multi-level-marketing (MLM) model, said Ms Dalal. She gave the example of National Insurance Company, which is a government undertaking. “The selling technique for some products look like MLM, but the company denies it,” she said.




6 years ago

Corruption, fraud, deceit, fudging and many more actions have reached monumental proportions. The cause appears to be monumental neglect of Government, Governance, Regulations, Oversight functions, Responsible Civil Society, Apathy of people, Extended honey moon period of the joy of freedom, Blissfully ignoring the cancerous role of hijacking of institutional mechanisms by elected representatives, Use of corruption as spring board by Elected Politicians, Institutionalization of the attitude that corruption in society or nation is like DNA to Human race without which there can be no human, (broadly under one phrase “Checks and balances”) and so on and so forth since 1947. Now the solace for political parties as well as people (Voters) is that any way corruption (covers a large number ranging from day to day bribes to fly by night business shops to mega companies to mega schemes to mega scams to balance sheets fudging to harassment of employees {Senior Colleague-Junior Colleague kind} in offices, organizations, adulteration, duplicate business ( ---the list is very long) has become incurable cancer and it is impossible to get out of it and hence it will be useless to support any one on this issue. If at all anybody supports this he would be an idiot and indulging in doing anything about it is madness. So the net result is Human race has two substances that separate life from death that is corruption and life material (so far it has not been discovered) which means Human is dead without corruption.

Madhusudan Thakkar

6 years ago

Thank You Sucheta ji.You are doing a wonderful job at Moneylife.Mainstream media and so called champions of "Independent Media" will never enlighten general public on these important issues of personal finance.Mainstream media will do anything for advertisements.

Mohan Das

6 years ago

Has National Insurance Company tied up with any Ponzi company for marketing Medicliam policies? If yes, which are these companies?

Who authorized sanction to a Thrissur (Kerala State) based MLM Company to sell Mediclaim policy?

How can a company that has closed its registered office (declared illegal & shut down its registered office by the police) sell insurance (mediclaim) policies of a Government of India undertaking?

National Insurance Company must give an official clarification.

Kishore N

6 years ago

How can National Insurance Company deny? National Insurance Company must immediately ask the Ponzi company to remove the page.

National Insurance Company page in Penta world India website:-



In Reply to Kishore N 6 years ago

Please one of the Products of Penta world India. It is nothing but mediclaim policy. These are hard facts. National Insurance must clarify.


In Reply to Raj 6 years ago

Medicalim policy is one of the products of Penta world India is selling through money chain route. Please see the products :

Kishore N

In Reply to Raj 6 years ago

National Insurance company cannot just deny and wash off their hands. What is IRDA doing?. There is some thing fishy. need a thorough inquiry.

Kishore N

In Reply to Raj 6 years ago

Penta world removes mediclaim products from its product list !


6 years ago

Thank You Ms. Dalal. We are grateful to you.

After spate of attacks, CIC passes resolution for protection of RTI users

The CIC has provided a fresh format for registering complaints regarding attacks on RTI activists. If an attack is reported, the CIC can direct the concerned departments to take ‘suo moto’ cognisance and publish the details of the same on their websites

The Central Information Commission (CIC) has passed a resolution to ensure the protection of Right to Information (RTI) activists, following a slew of attacks on them and murder of RTI activists in recent times. The CIC says that in case an attack is reported, it will examine the pending applications of the victim and order the concerned department(s) to publish the requested information suo moto on their websites as per the provisions of law.

The CIC has also provided a format for registering complaints about attacks on RTI activists. When a complaint is registered, the Information Commission will issue an order to the departments concerned that the information sought by the victim be displayed on the authorities’ websites in less than four weeks.

“Even if any of the information is exempt under Section 8 (1), the Commission is requested to order disclosing it, since it appears that the attack/murder was motivated by the desire to ensure that this information must not be revealed. Also, revealing this information will ensure that RTI users will not be attacked in future. Thus on both counts there is a larger public interest which would be served by revealing the information which was sought by (name of RTI user),” the CIC has observed. Apart from that, the police departments will also be required to display on their websites a monthly update on the investigation in the attack/murder.

The CIC has said that in case of an attack, a complaint must be filed immediately to the concerned Information Commission under Section (18) of the RTI Act, and must include details of the attack, police and hospital reports and details of the RTI applications which may have been the cause of the assault. Even in cases where no complaint is registered, the Information Commission can suo moto initiate an inquiry.

In 2011, many attacks on RTI users have been reported. In January alone, five attacks were reported from Uttar Pradesh, Maharashtra and Jammu & Kashmir. In June, 72-year-old advocate and RTI activist Bhagu Devani was stabbed in Porbandar, Gujarat. On 15th August, RTI activist Shehla Masood was shot dead. In 2010, some 28 attacks were reported, including 10 murders.

“The Commission strongly believes that it is the duty and responsibility of the respective Governments to safeguard the life and liberty of the RTI users… and  also resolves that it will take proactive steps in ascertaining the status of investigations/prosecutions of the cases involving information-seekers and endeavour to have these processes expedited,” says the resolution.


Are we losing our hard-earned Right to Information?

The RTI Act has become a powerful tool in the hands of social activists and it has managed to thwart many possible scandals in the government and the bureaucracy. Is that why a few political leaders in the current regime are trying to water down the stringent provisions of this Act?

Does the RTI (Right to Information) Act hurt governance? That seems to be the argument from the current government at the Centre. In fact, the Congress returned to power in 2009 with its coalition UPA-II by showcasing the RTI Act as its biggest achievement to empower people.

Now we are tempted to ask this question—was the RTI Act passed only for the purpose of returning to power? Now it appears that the current regime is having a hard rethink over the Act. With the RTI Act playing a key role in exposing the UPA’s various mega-scams (too numerous to be detailed here) especially by bringing into the public domain the explosive note by the Finance Ministry on the then Finance Minister P Chidambaram’s alleged role in the spectrum scandal, the Act has indeed become a source of major worry for the government.

Law Minister Salman Khurshid and Corporate Affairs Minister Veerappa Moily are already demanding a relook at the RTI, declaring that “it has not found favour with jurists and activists (read NAC, or National Advisory Council, activists)”! In fact, this outburst is yet another attempt by the UPA to water down the law whose main aim was to make government functioning more transparent.

The Congress now favours a debate on the aspect of RTI impinging on governance. Its spokesman Manish Tewari says that there was no denying the fact that RTI was empowering people but “whether this efficacy is impinging on governance is to be seen.” An invigorating debate is going on over RTI with an entire spectrum of views coming from various stakeholders; and the Congress is to hear all sides on the issue before formalising its stand.

A senior Congress leader, (according to media reports), on condition of anonymity, has said that in the prevailing situation, “the bureaucrats will be scared to put their views in writing on various issues.” Terming these bureaucratic sentiments as “legitimate apprehensions,” the leader says that the RTI issue should be handled in a “sensitive manner”.

This is in sharp contrast to the earlier stand of the Congress, which never missed an opportunity to tom-tom the fact that RTI was one of the most important pieces of legislation which the party had managed to bring into law.
The credit, of course, for passing the Act was given to party President and NAC Chairperson Sonia Gandhi. To avoid the wrath of the activists and civil society, the Congress is still short of openly coming out and saying if the RTI Act should be amended or diluted.

J S Verma, former Chief Justice of India, does not buy this contention. Even former civil servant-turned-activist Harsh Mander, also a member of the Sonia Gandhi-headed NAC feels there should be no tinkering with the Act.
Mr Khurshid had recently said that RTI “misuse” was affecting “institutional efficacy and efficiency”, with even the bureaucracy becoming reluctant to record its opinion. Demanding a relook at RTI, he feels that a “balance” has to be maintained between transparency & accountability and institutional efficiency.

Mr Moily complains that RTI “transgresses into the independent functioning” of the government. “In the context of RTI exposures, people are misreading things,” he has said. “Transparency, yes, but it cannot scuttle the independence of individuals and ministries expressing difference of opinion. It’s time for a national debate on this issue,” he has declared.

This change in thinking both within the Congress and the government has come against the backdrop of the political crisis faced by the UPA government recently, as the RTI had “accidentally” helped Delhi lawyer Vivek Garg get the controversial Finance Ministry note which accused the then Finance Minister P Chidambaram of failing to stop the 2G spectrum scandal by not insisting on an auction.

We citizens are upset over the words coming from the government and the Congress on the RTI Act. The Act has emerged as a major instrument for exposing scams taken place in the past and can effectively put a stop to any future scams. What do these ministers want? Should the guilty not be punished? Should scams be allowed to happen? Should the truth not come out before the public?

No change in the transparency act should be brought about without taking us, the users of the RTI Act, into confidence.

Surely, Mr Khurshid finds the recent spat between the Finance Minister and the Home Minister a little too hot to handle. That’s why he wants a “balance to be maintained” between transparency & accountability and institutional efficiency. Not surprisingly, he wants a dispassionate examination “at what stage confidential documents, particularly communication between the PM and ministers, can be given under the RTI Act”. The days of ‘a rethink to amend the law on file notings’ resurface again. The RTI Act was modelled on the US Freedom of Information Act. The main premise of the Act itself was that there would be maximum disclosure and minimum confidentiality. Why should any honest officer have anything to worry about, in case his file nothings are provided under the RTI Act? Also, the Act itself has adequate safeguards to check its misuse.

Let Mr Khurshid specify what he means. If it’s the government’s new line of thinking, it must be because of the material provided under the RTI Act that has led to scams being unearthed. Don’t we have the right to monitor the functioning of the government? If not, what then is the use of the RTI Act?

This Act has done more to check corruption than any other administrative reform. It has created a billion-plus Lokpals among us, with each and every citizen armed with the power to inspect the functioning of the government.

It is a misplaced premise that civil servants are scared due to the (possible) misuse of the Act. Having spent a major part of my active life in the Union Government, I can say that any government servant, who does his work conscientiously, need never be bothered about his decisions being subjected to inspection. In fact, there is an urgent need for the government to further strengthen and consolidate the Act.

Team Anna member and senior Supreme Court advocate Prashant Bhushan feels the newfound unease within the government on the RTI Act is because the corrupt are afraid of the consequences if their misdeeds are exposed through the Act.

There’s a strong possibility of the Lokpal being set up soon. The Hisar by-poll is almost a referendum on the proposed Lokpal. No wonder ministers have suddenly started seeing the ‘danger’ in the Act.

One can only ask: Are we losing our hard-earned “Right to Information”?



Nagesh Kini FCA

6 years ago

The pluses and minuses of the RTI Act are many.
First the plus side - the present well crafted Act has ferreted many mal-governance issues and exposed scams that were investigated and confirmed by a detailed CAG audit.
On the down side is the gross abuse of the Act, by the so-called self-styled
'intellectuals' - the aam admi and tycoons care a damn - are misusing the Act by filing multiple and frivilous applications on the same issue making a mockery of this useful tool.
Both Mr. Khurshid and Moily have hidden agenda in wanting to tinker with the RTI Act.
The applicant has to prove his locus standi and let an independent panel oversee any irregular rejections.

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