Crime Branch officials of the Kerala police arrested Amway India’s managing director and chief executive William Scott Pinckney and two directors, Anshu Budhraja and Sanjay Malhotra of the multi-level marketing (MLM) company for alleged money laundering and breach of trust. The arrests were made under the Prize Chits and Money Circulation Schemes (Banning) Act 1978 (PCMCS Act), which only goes to prove that the Act is not as toothless as various state governments have liked to claim. Moneylife and Moneylife Foundation have always said that Amway and several other multinational chain-schemes do fall foul of the PCMCS Act and there are clear high court judgements to this effect.
Last month, after the collapse of Saradha group, the ministry of corporate affairs (MCA), in a face saving measure, has decided to hand over probe of such chit-fund, MLM, Ponzi and pyramid scheme operators to the Serious Fraud Investigations Office (SFIO). The ministry said the probe has been ordered in view of a larger public interest involved in the issues, although the state governments are the appropriate authorities for regulation of such chit fund companies and schemes under the Chit Fund Act, 1982. Since then dozens of schemes in Kolkata, which claimed to be chit funds have collapsed. Over 18 people have committed suicide out of despair over the loss of their life savings in Saradha alone.
Interestingly, the PCMCS Act, 1978, was promulgated only after large-scale loot by these dubious companies and a report by the James Raj Committee (1974) called for a total ban on such schemes arguing that they were prejudicial to public interest. Over the past 35 years, the Prize Chits Act has been rendered ineffectual because of the refusal by state police to act quickly enough—the only exceptions to this have been exceptional police officers like VC Sajjanar from Andhra Pradesh (AP) and sporadic action in Kerala.
The fact is there has been plenty of litigation on the issue, precisely because various authorities consider that the operations are illegal under the PCMCS Act of 1978. Moneylife Foundation, an NGO working towards spreading financial literacy, has repeatedly warned people about falling for MLM and pyramid companies with innumerable examples of losses incurred. Moneylife Foundation sent a representation to the prime minister, finance minister, governor of RBI and SEBI.
A set of powerful MLMs, which are part of an exclusive closed club, called the Indian Direct Selling Association or IDSA (on the lines of the Direct Selling Association of the US) has been lobbying hard to make a distinction between their operations and those of others, who they call, fly-by-night operators such as Speak Asia and Ad Magnet. In fact, the tens of thousands Ponzi/double-your-money schemes that exploit poor financial literacy cause the biggest losses to Indians across the economic spectrum today.
Amway can be at best a source of pocket money
Senior Amway representatives had met Moneylife to clarify their views on Amway. Richard N Holwill and Rajat Banerjee , who met us, admitted that although some distributors tend to go overboard in pitching the scheme, income from being a distributor of Amway can, at best, be a source of additional income or pocket money for most people. It is not the pathway to riches as MLM companies make it out to be. However, Amway also insisted that there is no longer any joining fee and the model does not necessarily require enrolment of distributors. However, there was no answer to expensive nutraceuticals being prescribed by doctors, whose wives or relatives were Amway agents.
In India, AP was the first state to enact a law to ban money circulation schemes in 1965. Both the Supreme Court and several high courts have passed landmark judgements against the operation of these schemes as they violate the law of the land and are detrimental to the interests of the public. There are on-going cases against Speak Asia and Amway, to cite two examples.
After the decision of AP High Court, a spokesperson for Amway India had said that the company had filed a special leave petition (SLP) before the Supreme Court. The HC in its ruling observed that the company's business model may come within the mischief of money circulation scheme under the PCMCS Act.
VC Sajjanar, a former superintendent of police, Economic Offenses Wing, Andhra Pradesh, who was involved in the investigation of Amway, said this (the comment of the spokesperson) was nothing but a propaganda used by the company to continue its MLM operations. “Section 3 of the PCMCS Act prohibits any entity from promoting, conducting any prize chit or money circulation scheme, enrolling any member of any such chit or scheme, or participating in it otherwise, or from receiving or remitting any money in pursuance of such chit or scheme. This is the provision we used to ban Japan Life, Amway and GoldQuest,” said the officer, who is now DIG at Hyderabad.
Moneylife has been writing about the menace of MLM schemes, including GoldQuest, QuestNet, Stockguru.India, Japan Life, Amway, Speak Asia, NMart, AdMatrix and so on. On the other hand Moneylife Foundation is helping people to become aware about money circulation or MLM schemes and is actively involved in making changes in the government policies through representations, memorandums etc.
Moneylife had been the first to flag Speak Asia as a fraud, way back in October 2010. In December 2010, Moneylife had reported about the dubious modus operandi of Stockguru.India and advised investors to stay away from investing in the company. It collapsed much later. Similarly, in August 2011, we informed our readers, how Surat-based NMart Retails, a division of Newlook Multitrade Pvt Ltd, is running a collective investment scheme (CIS) based on MLM model, under the guise of selling products through its retail chain. Needless to say all the three mentioned above duped lakhs of people. There are scores of other such examples.
EAS Sarma, former secretary to the Government of India (GoI), has written several letters to the prime minister, ministry of corporate affairs, ministry of finance, Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI) and others, on MLM menace.
“Many of these (MLM) companies are not even registered under the Companies Act. Even those registered evade regulation. Those booked regroup under different names and continue to cheat the people. All these companies and those that promote them should be dealt with an iron hand and be prosecuted effectively,” he said.
Kerala, said to be the country’s most literate state, is flooded with numerous “get-rich-quick” or “earn-huge-return” schemes offered by money swindlers. While the state director general of police has admitted noticing frauds amounting to over Rs1,000 crore, the worrying factor is that even a few policemen have been found to be involved in these MLM schemes.
The Kerala police have also warned hotels, restaurants and convention centres across the state, not to allow money-chain companies to hold any meetings on their premises.
MLMs, chain companies or networking companies—also known as chit funds or blade companies—have turned very powerful in several states, which are ruled by regional parties and have strong political connections. Their political funding protects them from any action. Also, as Mr Sarma has pointed out, “Many of these promoters have political links and they approach various ministries in the guise of marketing companies and make overtures to protect themselves. They know that they can play one ministry against the other and get away with their loot.”
Independent regulators are all IAS officers who owe their jobs to being compliant or their willingness to act as hatchet persons for politicians (barring the singular exception of Vinod Rai as Comptroller & Auditor General of India, (CAG). Nobody in the system is under pressure to prevent wrongdoing; hence, no regulator, bank chairman or union minister has lost his job in the past 20 years, despite the sharp increase in the size and number of scams. If this is true of massive scams and misappropriation of funds unearthed by the CAG (2G, coalgate, irrigation, aviation, mining, defence procurement, disbursement of government subsidies, etc), where is the question of holding anyone accountable for failing to go after MLMs, Ponzis and chit funds?
Remember, Saradha chit fund from West Bengal? Millions of people were connected to the chain-money or chit fund companies in West Bengal. These created the wrong kind of jobs and dubious economic growth, which is under threat with no new businesses coming up and chit funds unravelling.
There are more than 50 major schemes operating in the eastern India, commonly called chit funds, but really in the 'business' of paying old deposits with the new ones, thriving on the potent cocktail of illiteracy, greed and regulatory inaction. There are a few thousand smaller schemes that are also conning people with the same modus operandi. And, they are now imploding.
After the Saradha case blew up mid-April, the flow of money has completely stopped. The collapse of Saradha, with ostensible businesses in automobiles, cement, media etc., has claimed several lives.
The media too will be deprived of an important source of revenue. The Bengali print and TV media and the hoardings, thrived on advertisements from Rose Valley and MPS Greenery. Rose Valley has set up its own TV channel now but continues to advertise in popular media outlets like ABP’s Ananda channel. In a last burst of that cosy relationship, the print media is now getting huge ads from the surviving several chain-money schemes which are asserting that they are different from Saradha.
While the RBI has maintained that the deposit-taking companies does not fall under its jurisdiction, market regulator SEBI tried to rein in such companies in the past under its collective investment schemes (CIS) regulations. However, these companies managed to subvert the SEBI orders and continued to flourish with political patronage.
Another interesting aspect of all deposit-taking companies is the source of money. Nobody knew exactly where the money was coming from for these companies, but everybody suspected that it was some kind of a pyramid marketing scheme, made infamous 30 years ago by the failed Sanchaita Investments. Sanchaita Investments went bust in 1980s leaving behind a long trail of ruin and suicides by number of agents and depositors in West Bengal.
So far, all deposit-taking companies, chit funds and CIS operators have received patronage from politicians across the party lines. Especially in West Bengal, the ruler got changed but patronage has remained the same. The CID and state finance department officials had once raided Rose Valley’s office in Tripura, but to everyone's surprise, no arrests were made. Many people had attributed the outcome to Rose Valley's cosy relations with the Left Front.
The Saradha group is reportedly known to be close to Trinamool Congress leaders and the government.
According to Robert FitzPatrick, President of US-based Pyramid Scheme Alert, schemes like Amway, QNet or GoldQuest are an “endless chain”, or a “pyramid scheme”.
“I believe this form of fraud is a clear danger to national economies. They subvert efforts to accumulate wealth. They divert energy and funds from real businesses. They often divert people from seeking more education with their promises of fast wealth. They destroy savings and equity of lower income people. They confuse people as to what a legitimate value-based business is. Unless the regulators and analysts recognize and are willing to assert that this form of business is ‘inherently’ fraudulent and harmful, it is rather difficult to stop any one particular company. Such a fraud, whether the products are soaps, gold coins, vitamins or air in a box, will always cause 90%-99% of the investors to ‘fail’. Whether some of the people engage in retail selling or not, the income promise that relies on continued expansion is deceptive, that is, it is a lie. The financial harm to the vast majority is predetermined. Calling it a business does not make it so. A real business requires an exchange of value,” wrote Mr FitzPatrick to us. He is actively exposing several pyramid, Ponzi and MLMs.
Here are some of the important stories written and representations made by Moneylife over the years…
Moneylife Foundation’s representation to PM, FM and RBI on MLM schemes
In May 2011, following the exposé by Moneylife on Speak Asia Online Pte Ltd and its MLM scheme, Moneylife Foundation sent a representation to prime minister Dr Manmohan Singh, (the then) finance minister Pranab Mukherjee, finance secretary Sushama Nath and Reserve Bank of India (RBI) governor D Subbarao urging them to ban all MLM companies and their schemes in the country, or to bring all MLM companies under the regulation of either the RBI or the Securities and Exchange Board of India (SEBI), to stop them ensnaring gullible people.
West Bengal’s ‘chit fund’ mess and inaction of MCA
The massive money, which is raised surely shows somewhere on the balance sheet of the company, filed regularly with the MCA. The primary recipient of the information about these companies is the MCA, and surprisingly the MCA is the least proactive in the entire process of bringing these perpetrators to regulatory focus, sooner before tonnes of money vanish.
Dubious pyramid schemes or money-circulation schemes are looting Indians across economic strata, finds Sucheta Dalal. This will continue since Central and state governments seem unconcerned.
Pyramid schemes: Daylight robbery
Pyramid marketing companies are looting the public easily, while the government watches. Many countries have banned them outright.
Ponzi Scheme: Is RBI Passing the Buck?
A strange deposit scheme that is proliferating in the states of Orissa, Chhattisgarh, Karnataka and Maharashtra has already collected almost Rs1,000 crore and is expanding virtually unchecked. The scam has elements of money-laundering and possibly the use of fake and forged currency as well; however, the banking regulator would like to pass off the investigation to the respective state governments for investigation under the antiquated Prize Chits and Money Circulation Schemes (Banning) Act.
An international network marketing scheme hawking expensive limited edition coins is attracting a huge following. Sucheta Dalal examines this strange quest.
Moneylife readers know how MLM schemes ensnare lakhs of people by promising extraordinary returns. We learn from the ministry of consumer affairs that the government is now waking up to the need for better regulation of MLMs and Ponzis. At the same time, the powerful Direct Selling Association of the US is lobbying hard for an amendment.
‘Beware of deception by pyramid schemes, MLMs trying to lure people with promise of high returns’
Pyramids are pure fraud. Their business is unsustainable-they promise payment for goods or services of dubious value. The hallmark of these schemes is the promise of sky-high returns in a short period of time, for doing nothing other than simply handing over your money to them, and getting others to do the same.
Ponzi schemes: The fraudulent art of chain game
Even as India bans pyramid schemes under a statute called the Prize Chits and Money Circulation Schemes (Banning) Act, 1978, the country continues to be a happy hunting ground for pyramids because our legislation is deliberately unworkable.
Investors losing money, or falling for dubious Ponzi schemes, is not a recent phenomenon; this has been happening for decades and it is not restricted only to India. Why is it that people repeatedly fall prey to such schemes in spite of being aware of the frauds perpetrated by conmen under different guises?
Set up inter-departmental group to curb MLMs
EAS Sarma, former power and finance secretary, said the ministry of finance, RBI, SEBI, and the investigating agencies should collectively tackle this problem without any delay, as every day of procrastination will only result in thousands of hapless families cheated by the promoters of these schemes.
How MLMs wave an annulled letter to claim legitimacy of their operations and con people
Spokespersons and dealers of MLM schemes or network marketing schemes respond to questions about their legitimacy by brandishing a 2003 letter issued by the then secretary, ministry of corporate affairs (MCA). What they omit to mention is that the letter was subsequently annulled following complaints about its misuse. This means, the letter used by these scamsters is no more valid.
Pyramid and MLM schemes are scourge on people
While there are existing laws such as Indian Penal Code (IPC), the Prize Chits and Money Circulation Schemes (Banning) Act, 1978 (PCMCS Act) and others under which concerned agencies could prosecute the culprits, there is no effective mechanism in place to ensure a coordinated approach to identify the fraudulent operators in advance and book them well before they destroy the livelihoods of thousands of households and launder the ill-gotten funds to unknown destinations.
MLMs now want to ‘invest’ money in India, really?
A set of powerful MLMs, which are part of an exclusive closed club, called the Indian Direct Selling Association or IDSA (on the lines of the Direct Selling Association of the US) has been lobbying hard to make a distinction between their operations and those of others, who they call, fly-by-night operators such as SpeakAsia and Ad Magnet.
QNet, the MLM company, has no answers to Moneylife’s simple questions
QNet, the controversial Hong Kong-based multi-level marketing (MLM) operator with multiple names (GoldQuest, QuestNet, QNet, QI Ltd and QI group are the better known names) refused to answer simple questions like how much money their independent representative (IR) earns on an average every month and why their products are priced so highly. Instead, it sent us a threatening and defamatory mail that raises more questions as to their real motive.
2011: A year dedicated to MLM and Ponzi scheme frauds
If 2010 was the year of great Indian scams, 2011 was rather of Ponzi and MLM frauds. SpeakAsia managed to top the chart, but soon many others joined the bandwagon, duping gullible investors for several thousand crores.
How to avoid 'get-rich-quick' schemes and scams
Nothing comes free in this world, especially money. The universal truth is you need to earn your money by hard labour all the time and there are no shortcuts to double it in the shortest span of time. Therefore, even if your near and dear ones tell you he/she will double, triple, quadruple your money within a few days/months, politely reply to them that it is not possible and what they are advocating is a pure “get-rich-quick” type of scam.
Herbalife is a pyramid scheme worth zero dollars: Bill Ackman
Herbalife, a global MLM scheme also prevalent in India, is believed to be worthless according to hedge fund manager Bill Ackman, who made a detailed presentation on why consumers should avoid buying the company’s products and stay away from the MLM.
Inside story of the National Stock Exchange’s amazing success, leading to hubris, regulatory capture and algo scam
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Fiercely independent and pro-consumer information on personal finance.
30-day online access to the magazine articles published during the subscription period.
Access is given for all articles published during the week (starting Monday) your subscription starts. For example, if you subscribe on Wednesday, you will have access to articles uploaded from Monday of that week.
This means access to other articles (outside the subscription period) are not included.
Articles outside the subscription period can be bought separately for a small price per article.
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https://www.youtube.com/watch?v=jyZKDkz6iuk
It .
http://www.business-standard.com/article...
Two top representatives of QNet, a Hong Kong-based multi-level marketing company allegedly involved in a Rs 425-crore fraud here, were arrested today after being picked up from Delhi international airport, police said.
The controversial company's senior independent representatives, identified as Sandeep Kalra and Hitesh Miglani, were intercepted by immigration authorities at the Indira Gandhi International Airport at Delhi last night, said an officer with Mumbai Police Economic Offence Wing (EOW).
The duo, who arrived from Dubai in separate flights, was stopped at the airport as Look Out Circulars (LOC) were issued against them by the EOW probing the case.
The two suspects, who were suspected to have had pocketed lakhs of rupees through the scheme and organised several training camps to lure investors, have been subsequently brought to the metropolis and placed under arrest this evening, police said.
The LOCs have been issued against those whose statements have been necessitated in the probe but did not appear before the investigators despite summons.
Kalra hails from Delhi while Miglani is from Bangalore, police said adding that this is the first arrest of those against whom LOCs had been issued.
The EOW had earlier arrested 15 persons for allegedly duping investors by selling QNet products, including magnetic disks, herbal products and holiday schemes, through allegedly fraudulent means.
The EOW has invoked the stringent Maharashtra Protection of Interest of Depositors (MPID) against the company which has denied any wrongdoing on its part.
QNet has also been accused of using the banned binary pyramid business model. An FIR in the case was registered in August in 2013.
The accused had been charged with cheating and forgery under relevant sections of the Prize, Chits and Money Circulation Schemes (Banning) Act, 1978.
Later these QNETERS tried to do a "system" in Islam Gymkhana and had to cancel that also.
It is said that the third time these people placed advertisements in newspapers of mumbai to invite people into investing into a "Business Opportunity" and were holding that meeting in hall in dadar-west.
It is being said that today morning crime branch officials raided several residential places of QNET leaders all over mumbai and the following were detained/arrested.
Vivek Kumar Singh
Shashi Bushanrameshwar Pandey
Namrata Pandey
Sabina Mathews
Vijay Mathews
Jagdev Singh Parmar
Rohit Chandra
Mahesh Bhansali
All the above people have shared the "proceeds of crime" and huge amounts of money had been transferred into their bank accounts under the guise of "commissions paid". Sources say these huge amounts of money has been raised by running a money circulation scheme in India under the guise of "ecommerce" by QNET India.
It is now upto the rest of QNET IR,s to decide whether they want to continue to be part of this crime of "money circulation scheme" or they want to join the investigation and help the police and become "Government Aprovers".
It is your choice you want to become a accused in this crime, because some day some one will surely report you, it is better to give up this "white collared crime" now itself, then land into trouble later.
I appeal to you all IR,s to give this anti national activity once again, Please do not forget this is not happening the first time. Previously also in chennai assets,properties,cars, bank accounts etc of all TOP IR,s and team leaders were sealed by chennai CID.
These are experts taken from the interview of Absconding Accused Vijay Easwaran
“QNET operates in India through a Franchise company hence Absconding Accused Vijay Easwaran has no involvement in it, he is neither a director nor a shareholder of Qnet India.
He further threatened to seriously think of Pulling out of INDIA.”
BOSS, you are talking of pulling out? YOU and YOUR SCAM will be KICKED out of my nation INDIA wait and see and this will not be the FIRST TIME that you are KICKED at your FAT A$$ and thrown out, will follow your SHAM company and expose it till you call it QUITS, the sooner you PULL OUT the better warna you know that saying “Badey Beaabroo ho kar terey dar sae nikley”
So Mr. Absconding Accused Vijay Easwaran if you have a BRAIN to think of new new SCAMS there are people who can work together to EXPOSE your SCAMS...r u ready for it now….hahaha
Account Name: Vihaan Direct Selling India Pvt Ltd,
Bank Name: State Bank of India
Branch: Horamavu
Address: NO.2A Munireddy Layout,Horamavu Main Road, Banaswadi, Bangalore – 560043.
Account No: 32322965489
IFSC Code: SBIN0013397
Happy Diwali Q...next is what?
Hehe more to come ;)
Some IR asked this question emphasizing again and again on the word “HALAL PRODUCTS” but the council answering this question sees through the EVIL DESIGN and pronounces this business of “NETWORK MARKETING USING WATCHES AND JEWELLERY AS HARAM”.
Question: 20938
Saudi Arabia
I want to know about one business. Which is as following. Sir the business name is network marketing. The process is that I buy one product which is truely HALAL.e.g wathces, Jewellery etc. Aftre buying the product the company from where I bought the products asked me whether you want to become our business parter If I said Yes. Then I become the business partern of that company. And the money I paid to buy the product is my investment. Now if some more persons come to buy the product from this company through my refrece. Then company will give me commission let say 3% to 6% of each product. and the products are truely HALAL. And there is no cheating also. If I make the marketing of this company and asked the people to buy more product from this company then my i will get profit. If i stop then i will not getting anything. Please let me know whether this business is HALAL or not ... i shall be very thankfull to you if you email me this answer.
Answer: 20938
Mar 28,2010
(Fatwa: 548/L=186/tl=1431)
Network marketing involves cheating and invalid condition. Also, it involves earning profit by unlawful means; hence this business is unlawful according to Islam. It is not lawful to become a member of the company and receive profit.
Allah (Subhana Wa Ta'ala) knows Best
Darul Ifta,
Darul Uloom Deoband
The FATWA can be seen here http://darulifta-deoband.org/showuservie...
If you feel that all the people here who are writing are bought over by Ms. Dalal... then you are highly mistaken, because if you see in the depth of it, Its only that they are educating people to save their hard earned money....
Unlike you modern people who have just sold your subconscious mind to GREED (In your language Dreams).
Achieving dreams is good if its done through utilizing your skill set, like Sylvester Stallone did and there are many other people whose videos are shown in the systems to motivate people, not through focus on money. Here its a whole sole focus on money and not any skill.
Yes there might be a skill of talking... but that talking is also full of faking and a pretentious edification of self.
You guys have just lost it..... Your ethics, morale and respect.... for money you can do anything. Only money drives you.... Not these products.
If you see by large people who are involved in this are, from middle or lower middle cadre section who wants to make it big for themselves and have an additional source of income, But in this whole process, your acts are just motivated by greed and nothing else.... you woo people to come and join you on mere show of a few BMW's and encourage people to come out of their comfort zones, sell their gold, cars, houses and leave their jobs....
If you think that joining this would help you being an entrepreneur, then you are highly mistaken.
Yes you recruit people
Yes Its a low funded project
Yes Their are high income gains
Yes the company doesn't have any issues... I have been to VCON... I have seen it all... I have met Dato, Chief.... everybody.
Yes your commissions are paid on time.
But the whole issue revolves around this being a shortcut to make money... and in this whole process... you kill so many of your relations and in that moment of Motivation from the systems, you commit such horrendous achievable for your own self... Its like making yourself a captain for your team.... and then not delivering.... There is no focus on the products....
Yes this makes you learn how to make money but on the cost of the people to whom you commit so much through so many lies and hide things just to get the person on board.
This is all waste of time.
No body is bought over here by anyone, but yes the people who are on the QNET game still, have definitely sold their subconscious to Money and greed.
Come on Friends a golden opportunity for us LIKE minded people to come together and share our thoughts and experiences regarding this menace being played in India on the name of MLM/Network marketing and what not. LETS MEET !! YES !!
Saradha, Speak Asia, QNet, City Limouzine, StockGuru India, Sahara, MPS Greenery, NMart Retail… All these start as hot, new, investment opportunities and as alternative careers that offer high earnings and ways to escape the drudgery of 9-to-5 jobs. But, eventually, most of them fetch only small additional income and, worse, encourage you to lure and mislead your closest friends and relatives. You need to know how multi-level marketing (MLM) schemes and ponzis can destroy a large chunk of your savings or push you into debt. Understand the mechanics of these schemes, the laws that are applicable to them and why regulators fail to rein in dubious enterprises before they cheat thousands of people. Understand the basics of how to keep your money safe—the first step to smart investment! Collective investment schemes are not even under SEBI's regulation.
Sucheta Dalal, founder trustee of Moneylife Foundation and Managing Editor of Moneylife magazine, is one of the best known financial journalists in India. She has worked with many of India's leading newspapers including Times of India, Indian Express, Economic Ti mes and Business Standard. She was awarded the Padma Shri in 2006 for her investigative journalism spanning over 25 years which included exposing the Harshad Mehta scam in 1992. Sucheta Dalal will be conducting this seminar.
For registration please Contact:
Seraphina / Komal
at 022-49205000 or
email [email protected]
Log on to
foundation.moneylife.in
Amway is illegal because their own study showed only 3.4% of products are sold to outside customers, and that number is high because many of us were taught to show self consumption as outside sales by tricking the computer.
http://www.youtube.com/watch?v=UkuPGLEjv...
Say thanks to creator James for doing this :)
Listed below are some of the lines or words which mean nothing but QNET aka SCAM
Owner at Global marketing project
A Visionary at Global Marketing Project
Retired at I am THE COMPANY
e-Entrepreneur ! at Entrepreneur
Co Founder at My Office My Health
Global Marketing Projects at E- Enterprenuer
Works at Self Employed and Loving It!
Global Partner at Qnet
Worked at I am unemployable
Business Owner at Business Owner of a Global E-Franchise
Worked at Qnet
Past: THE V and QNET | Faith Egypt | Team Bring It
Global Entrepreneur at QNET (Official)
Past: InService Brotherhood Bootcamp
Works at Achieving the Dream
Chief Executive Officer at Unemployable
Works at Retired
Prosperity Consultant at Faith - Empowering You, Life & Business Coach, JPO Consultant, Networker at Tigers - Leveraging Vision andIndependent Consultant at QNET (Official)
Past: Genpact
Studies Leadership management style at Swiss E-learning Institute
Former Partnership at QI intl
Works at Self Employed and Loving It!
Worked at Honkong Based Multi Billion Dollar Company
Worked at Self-Employed (Business-Entrepreneur)
Retired of a JOB at Social Entrepreneur
Partner at ßusiness of Imp0rts & Exp0rts
Owner at E-Entrepreneur
Works at Qnet.net
Chief Executive Officer at Briltime Corp
If you see any of the above keywords on social media profiles of people trying to catch up with you ..just RUN RUN RUN :P
Regards
You can refer where it says
" Some people confuse pyramid and Ponzi schemes with legitimate multilevel marketing. Multilevel marketing programs are known as MLM's, and unlike pyramid or Ponzi schemes, MLM's have a real product to sell. More importantly, MLM's actually sell their product to members of the general public, without requiring these consumers to pay anything extra or to join the MLM system. MLM's may pay commissions to a long string of distributors, but these commission are paid for real retail sales, not for new recruits".
These countries have amended laws in last five or ten years but it seems that you tend to believe that prize chit fund and money circulation banning act 1978 which is 45 years needs no any such changes !!!
Why you still think for such companies like Amway, Avon and similarly others (who are members of IDSA) are illegal and defrauding people.
Why did yo decided to leave AMWAY?
I have a 3 friends trying to make me get in but there is something FISHY about it.
They said they are making 3000 dollars a month...they have a LONG LIST OF PEOPLE SUSCRIBE IT.
But add a product for cover, and call it an MLM, and people are willing to swallow its legality. Is this true? Really? Who says so?
It is a fact that a few large MLMs have survived against the best efforts of law enforcement officials to shut them down, spending millions of dollars to protect, lobby, and insulate themselves. But the same could be said for any organized crime. It is difficult to stop once it becomes so large.
And MLMs look so legitimate to the public, so decent. So many nice people are involved. Surely, it can't be illegal! The people lower down may even defend the very organization that is robbing them, hoping that they might get their chance to make "the big money" later.
But if it looks like a duck, walks like a duck, and quacks like a duck, it probably is a duck. Unless it is an MLM, and then it is NOT a pyramid.
Talk to a mobster, and he will tell you that he is "merely misunderstood in his benevolent intentions." "We are just trying to 'build our business.'" "It's all a conspiracy to make us look bad." "The Feds are out to get us because they are jealous or afraid of our new way of life." "Why, look at all the good we do!" "We are looking more legitimate every day." "Here's a statement from a famous DA that the Mob is really a good organization and no harm ever comes from it." "We've even got a minister to endorse us now!"
If you refer to link it clearly mentions that
"Pyramid schemes now come in so many forms that they may be difficult to recognize immediately. However, they all share one overriding characteristic. They promise consumers or investors large profits based primarily on recruiting others to join their program, not based on profits from any real investment or real sale of goods to the public. Some schemes may purport to sell a product, but they often simply use the product to hide their pyramid structure. There are two tell-tale signs that a product is simply being used to disguise a pyramid scheme: inventory loading and a lack of retail sales. Inventory loading occurs when a company's incentive program forces recruits to buy more products than they could ever sell, often at inflated prices. If this occurs throughout the company's distribution system, the people at the top of the pyramid reap substantial profits, even though little or no product moves to market. The people at the bottom make excessive payments for inventory that simply accumulates in their basements. A lack of retail sales is also a red flag that a pyramid exists. Many pyramid schemes will claim that their product is selling like hot cakes. However, on closer examination, the sales occur only between people inside the pyramid structure or to new recruits joining the structure, not to consumers out in the general public."
kindly refer to the link "http://www.ftc.gov/speeches/other/dvimf1..."
And by the way this article was published on 1998 !!!
And I think that Direct selling Industry is about $150 billion industry world wide
http://www.wfdsa.org/about_dir_sell/inde...
present in many countries !!!
I think, I believe with full of conviction that I can differentiate and difference between Companies who are doing mlms and those are working under guise of mlm by offering a product. One similar characteristic of such companies is that they will focus more on recruiting rather showing sales effort. I can, I have and I had retailed products of a direct selling company
One will need lakhs of Rupees of investment if he/she has to be in the system. what's wrong one tries to sell the products through team work provided they get income based on their personal sale and/or sales done by their team?
By the way you must be knowing in case of Amway that there's no investment required!!!!
Senior Amway representatives had met Moneylife to clarify their views on Amway. Richard N Holwill and Rajat Banerjee , who met us, admitted that although some distributors tend to go overboard in pitching the scheme, income from being a distributor of Amway can, at best, be a source of additional income or pocket money for most people. It is not the pathway to riches as MLM companies make it out to be.
Is it only in Amway and other MLM companies people tend to go overboard?
I can show numerous people who tend to go overboard in Insurance Industry.
So does it mean that by going overboard it attracts illegality?
For most MLMs, the product is really a mere diversion from the real profit-making dynamic. To anyone familiar with MLMs, the previous discussion (which focused so much on the fact that MLMs are "doomed by design" to reach market saturation and thus put the people who are legitimately trying to sell the product into a difficult situation) may seem to miss the point. The product or service may well be good, and it might oversaturate at some point, but let's get serious. The product is not the incentive to join an MLM. Otherwise people might have shown an interest in selling this particular product or service before in the real world. The product is the excuse to attempt to legitimate the real money-making engine. It's "the cover."
Intuitively, we all know what is really going on with MLMs. Just don't use the word "pyramid"!
"You see, if you can convince ten people that everyone needs this product or service, even though they aren't buying similar products available in the market, and they can convince ten people, and so on, that's how you make the real money. And as long as you sell to a few people along the way, it is all legal." Maybe...
But the way to make money in all this is clearly not by only selling product, otherwise you might have shown an interest in it before, through conventional market opportunities. No, the "hook" is selling others on selling others on "the dream."
Amway sells nutritional supplements
Herbal life sells nutritional supplements
Then why companies like pfizer, Sanofi, procter and gamble, Bayer, Novartis are in industry.
Infact according to Euromonitor international Vitamins and Dietary supplements is $90 billion industry (approx.)
Intuitively, we all know what is really going on with MLMs. Just don't use the word "pyramid"!
"You see, if you can convince ten people that everyone needs this product or service, even though they aren't buying similar products available in the market, and they can convince ten people, and so on, that's how you make the real money. And as long as you sell to a few people along the way, it is all legal." Maybe...
But the way to make money in all this is clearly not by only selling product, otherwise you might have shown an interest in it before, through conventional market opportunities. No, the "hook" is selling others on selling others on "the dream."
In a Company like Amway one has to atleast retail or sale product worth around Rs 20000 in order to be eligible for commission.
if he/she building teamwork he/she may sell products worth lakhs of rupees.
In companies like Amway commission paid is not on how many people you recruit but by the sales turnover and group dynamics.
If i recruit 100 people and products sold under me is zero then my income is zero.
Where is the "switch" that can be flipped in an MLM when enough sales people are hired? In a normal company a manager says, "We have enough, let's stop hiring people at this point." But in an MLM, there is no way to do this. An MLM is a human "churning" machine with no "off button." Out of control by design, its gears will grind up the money, time, credibility, and entrepreneurial energy of well-meaning people who joined merely to supplement their income. Better to just steer clear of this monster to begin with.
There is simply no way to avoid the built-in failure mechanism of MLMs. If a company chooses to market this way, it will eventually "hire" (with no base pay and charging to join) far too many people.
Thus, the only "control system" will be the inevitable losses and subsequent bad image the MLM company will gain after it does what it was designed to do: fail. And sooner or later we have got to stop blaming this particular MLM company or that, and admit that the MLM technique itself is fundamentally flawed.
In MLM a person's compensation is not on recruitment but on sales. it costs a mlm company zero expense if a person joins it.
Whereas in a typical marketing company a person has to qualify for it you know very well how much challenging it would be for a person to join a company which involves B2B sales.
Whereas in a company like amway products are simple in nature like soaps, hairoil, toothbrushes.
Why company would bother if people join mlm company? it's a win win opportunity for both.
You should know that it was this industry which played important role for livelyhood when countries were and are reeling under recession
http://www.express.co.uk/finance/city/40...
If your argument is so true regarding mlms that "There is simply no way to avoid the built-in failure mechanism of MLMs"
Then why Company like AVON which has been in the market for than 110 years.
Seeing the disastrous end of market naiveté in Russia should help clarify the fundamental problem with the MLM approach. In the real world, the profit of a company is directly related to the skill and prescience of the "hand" on the "supply knob," so to speak. In the USSR, that "hand" could not react fast or accurately enough to market realities through the best efforts of the bureaucrats.
With MLMs, the situation is much worse. Nobody is home. Even the Soviets had someone thinking about how much was enough! If the bureaucrat in Russia was having a hard time trying to play Adam Smith's "invisible hand" in setting the supply level in the Soviet Union, then an MLM "executive" is in a truly unfortunate position. Not only is there no one assigned to make the decision of how much is enough, the MLM is set up by design to blindly go past the saturation point and keep on going. It will grow till it collapses under its own weight, without even a bureaucrat noticing.
MLM is like a train with no brakes and no engineer headed full-throttle towards a terminal.
Can you tell me any corporate which put brakes on its sales revenue ?
MLM's growth is a manifestation not of its value to the economy, customers or distributors but of the recently high levels of economic fear and insecurity and rising expectations of quick and easy wealth. It is growing in the same way legalized gambling and lotteries are.
The most prominent motivating appeal of the MLM industry as shown in industry literature and presented at recruitment meetings is the crassest form of materialism.
Even Fortune 100 companies would blush as the excess of promises of wealth and luxury put forth by MLM solicitors.
These promises are presented as the ticket to personal fulfillment. MLM's overreaching appeal to wealth and luxury conflicts with most people's true desire for meaningful and fulfilling work in something in which they have special talent or interest. In short, the culture of this business detours many people from their personal values and desires to express their unique talents and aspirations.
regarding study commissioned by european commission on door to door selling - pyramid selling - multi level marketing rather telling my own judgement, my own feeling, my own verdict!!!
Do you have any such reports which proves your point ?
http://ec.europa.eu/consumers/cons_int/s...
http://ec.europa.eu/consumers/cons_int/s...
Link to the article - http://www.business-standard.com/article...
Talking about the morals of the Amway Business - Amway One by One Campaign has helped more than 10 Million Children in 10 Years !! More than $ 190 Million Donated & 2.7 Million Volunteer Hours !!
Link - http://www.multivu.com/mnr/55864-amway-o...
Amway Europe affiliates across 26 countries, along with Amway Business Owners and employees, supported & have donated more than $900,000 for all three preschools, giving educational support to 2,000 children.
Link - http://blogs.amway.com/onebyone/2012/10/...#.UG1Lc63Gn_U.facebook
The ethics of the business - Amway India Received Asia's Best Corporate Social Responsibility Award.
Link - http://www.amway.in/Docs/ACSRLA_Award_Wi...
Also Global Corporate Social Responsibility Award.
Link - http://www.worldcsrday.com/award_winners...
Link to the article - http://economictimes.indiatimes.com/opin...
Link - http://blogs.amway.com/amwayinsider/2013...#.UPROwb7_smI.facebook
Amway Charity Foundation is ranked 4th in the Transparency Index Rankings by China Charity & Donation Information Center. Amongst those in the Top 5, Amway Charity Foundation is the only organization to be set up by a foreign company !!
Link - http://www.amwayfoundation.org/en/latest...
Harvard Business Review Magazine Case study on Amway China & how one can learn from it.
Link - https://archive.harvardbusiness.org/cla/web/pl/product.seam?c=25093&i=25095&cs=04209ce96b14f658979117ff15018a2a
Forbes - Microsoft Team's up with Amway for Women Leadership
Link - http://www.forbes.com/sites/annedoyle/20...
Wall Street Journal - Amway Ranked 14th In Patent Board Worldwide & Number 1 in Research Density
Link - http://online.wsj.com/article/PR-CO-2013...
For you i guess all this maybe scam :)
The only credible person left on this earth is Mr Tex who updates his credible information on a 'wordpress blog'. You must be the president of some country. lol..
About the ethics & morals i can see that in the language you use to talk to others.. missing big time :).
Facts - Fact is that Amway operates in 108 countries & is $ 11.3 Billion revenue company & 25h largest privately held organization in America & your opinion wouldn't change that fact :).
Link - http://www.forbes.com/largest-private-co...
Henceforth I choose to ignore you believing in the quote mentioned below :)
Rightly said by Mark Twain - “Never argue with stupid people, they will drag you down to their level and then beat you with experience.”
My blog includes a collection of facts from various sources, it is not only "my" blog. You're an IDIOT. LOL
Enron, MCI, Tyco, Adelphia, etc., were big companies before they fell, the bigger they are the harder they fall, and size has NOTHING to do with being legal, ethical, or moral. IDIOT.
You're the stupid one, YOU refuse to discuss the facts.
Search the website there is plenty on RMP. Each article cannot mention all the tens of thousand schemes that are duping people. you may find others you have not heard about too, if you try and search MLM here
Thanks,
MDT
Shivinder and Malvinder Singh of ex-Ranbaxy are moving around with heads proudly held high after what their team did few years ago. No one seems to scrutinise Fortis, run by the same guys.
And you have to defend Amway. :-(
You can fight logic with logic and emotion only with emotion. Currently, I see only emotions flowing here.
If you believe in the Amway business, go ahead with it while following the rules of the govt (paying taxes, etc) and proper ethics. Let the experts worry about the merits and legal issues.
Link to the report - http://www.indicus.net/media/index.php/w...
"Nothing comes free in this world, especially money. The universal truth is you need to earn your money by hard labour all the time and there are no shortcuts to double it in the shortest span of time. Therefore, even if your near and dear ones tell you he/she will double, triple, quadruple your money within a few days/months, politely reply to them that it is not possible and what they are advocating is a pure “get-rich-quick” type of scam."