Trump’s MLM Pitch Misled Consumers, Lawsuit Says
A class-action complaint filed Monday in Manhattan federal court accuses President Trump, three of his adult children and The Trump Corporation of misleading consumers through their endorsements of two MLMs – ACN Opportunity, LLC and the now-defunct Trump Network – and The Trump Institute, which ran real estate seminars until 2009.
 
The bulk of the 160-page lawsuit centers on Trump’s endorsements of telecommunications marketing company and Direct Selling Association member ACN before turning to The Trump Network and The Trump Institute.
 
And it ends by claiming defendants violated the Racketeer Influenced and Corrupt Organizations Act (RICO), conspired to violate RICO, and engaged in false advertising, unfair competition, unfair and deceptive trade practices, fraud, and negligent misrepresentation.
 
The allegations in the complaint can be summed up as follows:
 
  • For at least 10 years, beginning in 2005, Trump secretly received millions of dollars in payments while deceptively marketing ACN to distributors by falsely telling them that they had a great opportunity to make money without risk, that he had personally done a lot of research into ACN and personally experienced the opportunity, and that his endorsement was “not for any money.” Trump even praised ACN on his reality TV show, “The Celebrity Apprentice,” posing with the company’s founders. ACN distributors paid a “$499 registration fee” to join. The four plaintiffs, each of which uses a pseudonym in the complaint, allege they made little to no money after their initial investment in ACN.

 

 

  • From 2009 to 2011, Trump was secretly paid to endorse another MLM – The Trump Network – and he made deceptive claims about the demand for the product, in this case, vitamins, and the business opportunity, among other things.

 

 

  • In 2005, Trump licensed his name to another company known as The Trump Institute. That venture purported to sell Trump’s real estate secrets of success through high-priced training seminars but despite Trump’s endorsements of the company he was not involved with it and his secrets were not disclosed in the seminars. Instead, consumers received plagiarized materials.

 

 
In a statement to The Washington Post, the Trump Organization, to which the White House referred comment, called the allegations “completely meritless” and the timing of the complaint politically motivated.
 
This is not the first time Trump has faced class-action litigation over his endorsements of a business opportunity. In 2016, while admitting no wrongdoing, then-president-elect Trump agreed to pay $25 million to settle class-action allegations of fraud against his defunct for-profit institute Trump University. As with The Trump Institute, that enterprise also promised consumers that they would learn Trump’s real estate secrets.
For more of TINA.org’s coverage on MLMs, click here.
 
 
Like this story? Get our top stories by email.

User

COMMENTS

Syed Aleem

4 months ago

Hi I have being a member with IMA from nearly two years before I introduce my capital I enquire them a lot and from that date till know they have never delayed my return nor delayed in returning the capital because one of my relative withdrawan his capital from FROM IMA and the same return to his account with out delay as per I know IMA they are running smoothly following the rule of the land I am really very much satisfied with IMA

REPLY

Tasmiya Naz

In Reply to Syed Aleem 2 months ago

Such an Idiotic qnet (MLM) it is.
I have been also involved by one of my senior. It's just an stupidity by not working hard and earning money through somebody else's earned money. By referring. . such a Idiotic business . All qneters want money without working. They don't want to work under somebody. . They involve innocent hard working people into it. By washing there mind with bloody shits. !!
In Bangalore it is growing very much. People of qnet are making Youngsters involved in such a stupid direct selling business. .
Please do something about it.

QNet and Vihaan Fail to Make Entry in the List of Direct Selling Entities in India
QNet, the controversial multi-level marketing (MLM) scheme, and its franchisee Vihaan Direct Selling (India) Pvt Ltd, both of which often try to hide behind the 'direct selling or product company' tag have failed to make an entry into the list of direct selling entities in India. 
 
The list, released by the department of consumer affairs under the ministry of consumer affairs, food & public distribution on 31 October 2018 has names of 327 entities mentioned as provisional direct selling entities.
 
The list has names like Amway India Enterprises Pvt Ltd, K-Link Healthcare (India) Pvt Ltd, and eBiz.com Pvt Ltd against whom there are some cases registered or probe is going on. For Amway, the list states one case is under investigation by the Directorate of Enforcement (ED) under the provisions of the Prevention of Money Laundering Act (PMLA), 2002. 
 
"Several criminal cases against Amway India Enterprises Pvt Ltd and its functionaries are pending or under investigation in the states of Andhra Pradesh, Telangana and Kerala. These are only those cases which have been brought to the notice of department of consumer affairs," the portal says.
 
Moneylife had earlier reported about eBiz.com. As per department of consumer affairs, there is a pending first information report (FIR) against eBiz.com at Hanamkonda Police Station at Warrangal in Telangana, which was registered in the year 2008. (Read: eBIZ.com uses MLM route to dupe students with IT package offer)
 
However, despite trying very hard to establish itself as direct selling or direct product selling company in India, QNet and its franchisee Vihaan have failed to make a cut in the list issued by the department of consumer affairs.  
 
As reported by Moneylife in December 2016, while a few powerful members were not allowing QNet’s entry into the Indian Direct Selling Association (IDSA), its franchisee Vihaan’s application too was rejected by other association, Federation of Direct Selling Association (FDSA). 
 
While rejecting Vihaan's membership application, the FDSA had said, "The Federation is repeatedly being approached by Economic Offences Wing (EOW) of Mumbai Police seeking various information regarding the company (Vihaan). The (Scrutiny) Committee feels it has collected the information about the pending court cases and is serious on the sub-judice status of the company. The Committee feels that the sub-judice status of the company (Vihaan) will jeopardise the faith of the government/ industry bodies in the Federation, hence recommends that the company need to come out clean before being considered by the Federation." (Read: QNet: FDSA too rejects Vihaan's membership application
 
QNet, the Hong Kong-based controversial MLM scheme has been facing backlash from several other countries as well. Earlier this year, QNet had to cancel its high-profile, flagship annual even called V-Con that that was scheduled to be held in Dubai between 8th to 12th September. 
 
In an email response, Zaheer K Merchant, director for corporate affairs at QNet, told Moneylife that, “As stated in the Facebook post, we had to make a decision to postpone the event due to circumstances beyond our control. You will note that several other large events were cancelled or rescheduled in Dubai in recent months, including the Dubai International Film Festival. We have no further comment here.”
 
QNet did not mention what these 'circumstances’ were, for cancelling its prestigious event. According to sources, the V-UAE 2018 was cancelled after Saudi Arabia declared QNet as haram and activities of the MLM company as ‘misleading activity’. On 1 September 2018, the ministry of commerce and investment (MCI) in Saudi Arabia issued a warning against QNet saying that its activities are prohibited in the country. 
 
From India alone, there were about 10,000 independent representatives (IRs) who have booked flight tickets to Dubai and also bought tickets at $350 each for the V-Con event. (Read: QNet Cancels V-Con Dubai Leaving Thousands of Agents in Soup)
 
On 1 September 2018, the Ministry of Commerce & Investment in Saudi Arabia had issued a warning against QNet (https://mci.gov.sa/en/MediaCenter/News/Pages/01-09-18-01.aspx) saying that its activities are prohibited in the country. 
 
Later in mid-September, the MCI from Saudi Arabia raided meeting places of QNet in that country. “QNet marketing activity aims to mislead and deceive dealers and clients with quick profit. Therefore, they try to raise money illegally by claiming that they are investing such money. This kind of activity is considered illegal because it depends on deceiving, cheating, fraud and manipulation,” the Ministry had said in a release. (Read: QNet: Saudi Arabia Raids Meeting Places of the Banned MLM)
 
Back home, there are several court cases and probe going on against QNet, its franchisee Vihaan and many people associated with the MLM scheme. In fact, two year ago, the Bombay High Court, in its judgement has observed "the deceit and fraud is camouflaged under the name of e-marketing and business".
 
While rejecting anticipatory bail applications of five accused in the multi-crore QNet scam, Justice Mridula Bhatkar, in a hard-hitting order on 6 May 2016 had said, "The motto of the company 'sell more, earn more' appears very attractive and innocuous. However, this motto is fully camouflaged. The company stands on a basic statement that people can be fooled. Thus, the true motto is 'sell more earn more' by fooling people. In fact, it is a chain where a person is fooled and then he is trained to fool others to earn money. For that purpose, workshops are conducted where study and business material is provided with a jugglery of words, promises and dreams. Thus, the deceit and fraud is camouflaged under the name of e-­marketing and business." 
 
"The claim that the wellness products i.e., Biodisk and Chi Pendent are medicinal and spiritual products, are after all, a matter of faith. However, the applicants/ accused have launched these wellness products with ulterior motive and with correct judgment of vulnerability of the people. The holiday packages, which were sold or offered, without any choice left to the buyers. The entire business was Internet based and, therefore, the persons who are responsible i.e., the top brass i.e., the applicants/ accused, were not approachable to the persons who were aggrieved. The nature of the business was knitted in the interest of the directors and shareholders in such a manner that the persons who are at the lower level of the pyramid cannot get any access to put up their grievances. The manner in which the persons were contacted, incentives offered, the workshops were conducted, are best examples of inducement," Justice Bhatkar had remarked. (Read: QNet: “It is a chain where a person is fooled and then he is trained to fool others to earn money” says Bombay HC order)
 
Gurupreet Singh Anand, a computer consultant from Lokhandawala, Andheri in his first information report (FIR) stated that his wife was duped for Rs30,000 by some people who had introduced themselves as the independent representatives (IRs) of QNet. 
 
While arguing before the HC in person, he had contended that the illegal money circulation scheme is being conducted in India by changing names from GoldQuest to QuestNet to the current QNet.
 
Earlier, the SFIO in its detailed ‘secret’ report on GoldQuest International Pvt Ltd and Quest Enterprises India Pvt Ltd has called multi-level marketing (MLM) schemes run by overseas operators as “a potential threat to national security”. (Read: QNet: Secret SFIO report says MLM, Ponzi schemes ‘a threat to national security’)
 
Like this story? Get our top stories by email.

User

COMMENTS

Tasmiya Naz

2 months ago

Alert !! Qnet is growing in Bangalore very much.
Even I was fooled by one of them ! It is such a Idiotic business. Where they fool people to earn money by fooling others.. ❌
If we do not stop this qnet or MLM. They will snatch money of the hard working people. ❎Mainly the people from Kerala are making qnet here in Bangalore and fooling people here. So it's growing faster .
People of qnet don't want to work hard. They just want earn money by others money. ! Such a Fraud company.
Police of Bangalore has to look under this matter.
❌ALERT to each one of those. Do not get involved in such type of MLM. Because I know what it is. !! They fool people ( mind wash ) easily. !!!

And people get trapped. !!
Please save us from this bloody shit business QNET .❌❌❌

REPLY

Qnet Analyst

In Reply to Tasmiya Naz 2 months ago

And these people in Bangalore they mainly work in which companies ?

Qnet Analyst

3 months ago

What are the events of QNet in 2019 ? They have events in Dubai, Thailand, Bangkok, Malaysia every year and 1000s of Indians and 1000s of people from middle east travel to these events. What events are planned in 2019 ? If QNet is on radar by so many agencies how can so many people get Visa to travel to Qnet events so easily?

REPLY

Atul Rathore

In Reply to Qnet Analyst 2 months ago

They don't have any proof of their existence and they are putting questions on a 21 year old group.
You guys have seriously no clue
What mistakes you are doing.
If still you have some humanity within then publish truth as well...apart from your publicity.

Tasmiya Naz

In Reply to Atul Rathore 2 months ago

Exactly. !! They are just publishing there qnet company with nonsense ideas and shits. By which people get fooled af !! ❌

Heera Gold Chairman Nowhera Shaik arrested in Hyderabad
Dr Aalima Nowhera Shaik, chairman of the controversial Heera Islamic Business Group, better known as Heera Gold, has been arrested by Hyderabad Police. Hyderabad Police Commissioner Anjani Kumar told media persons about the arrest of Dr Shaik, who is accused of collecting money as deposits from thousands of Muslim people from several states. Police also conducted searched her residence in the city, the Commissioner says.
 
In a statement Hyderabad Police said, "Central Crime Station (CCS) has taken up investigation, recorded statements of various stakeholders and other victims and collected evidences from different sources and found substantial incriminating evidences against Ms Shaik. Based on available evidences, Ms Shaik was arrested on 15th October at New Delhi and brought to Hyderabad on transit remand."

As per information available, the Police said, Ms Shaik is heading 15 companies under different names under Heera Group of companies. "Many of the companies are involved in collection of deposits and investment in different modes of gold scheme from public, where there companies commit a return of around 36% per annum for the invested amount. While exact number of investors, depositors is not known because the companies have not disclosed complete information before the Police. It is estimated that the number of depositors could be in thousands in different states of the country," the release says.

Hyderabad Police has identified more than 160 bank accounts of Heera group from across India and are seeking more details from the banks. The Police says, "Different properties have been identified and necessary action under the Telangana Deposits of Financial Establishment Act, 1999 and the Prize Chits and Money Circulation Schemes (Banning) Act, 1978, are under consideration."
 
Last month, over a 100 victims of Heera Gold held public protests in Hyderabad along with victims and investors from other parts of India.
 
The protests were led by Shahbaz Ahmed Khan, who had told Moneylife that over 200 investor victims have filed complaint against Heera Gold and its founder Dr Aalima Shaikh Nowhera (Nowhera Shaik). “Every day, I am receiving calls from panicky victims of Heera Gold from across the country seeking my help in recovering their investment. There are many who had invested more than Rs1 crore in Heera Gold and are now facing difficulties. They are neither receiving interest nor getting the principal amount back,” Mr Khan had said.
 
Earlier, in July this year, market regulator Securities and Exchange Board of India (SEBI) told Moneylife that activities of Heera Gold, are in the nature of Ponzi or multi-level marketing (MLM) scheme.   
 
Replying to an email sent by Moneylife with videos of panicky investors, the market regulator’s Hyderabad office wrote to say, "Upon examination into the matter, it was found that the activities of Heera Group are in the nature of Ponzi Scheme. Further, the nature of activities of Heera Group was also discussed in the meetings of State Level Co-ordination Committees (SLCC) of Andhra Pradesh and Telangana, which are headed by Chief Secretaries of the respective states. It was decided in the meetings of SLCC that the activities of Heera Group appear to be beyond the regulatory ambit of SEBI and RBI and the case would be taken up for investigation by relevant authorities such as CID-EOW, and Serious Frauds Office of India (SFIO). Accordingly, SEBI had already referred the case to CID-EOW, Enforcement Directorate, Commissioner of Police-Hyderabad."  
 
On 10 September 2018, Farzanaunissa Mohammad Khaja filed an FIR under Section 406, 420 of Indian Penal Code (IPC) and section 5 of the Telangana Deposit of Financial Establishments Act, in Bajara Hills Police Station at Hyderabad. Ms Khaja has alleged in the FIR that her husband had invested Rs25 lakh in Heera Retail Hyderabad Pvt Ltd, but the company has refused to return her money.
 
Thousands of investors of Heera Gold are in a panic since past several months over payment delays and rumours about financial difficulties faced by the group, which has amassed vast sums of money by specifically targeting the Muslim community by invoking the name of “Allah” in its sales pitch. 
 
The trigger for people gathering to protest at Heera Gold’s plush offices in Bengaluru, Hyderabad, Mumbai and other cities was the decision to 'share profit' once in three months instead of every month. But that is not the only issue.
 
In 2017, Dr Shaik, CEO of Heera Gold formed the All India Mahila Empowerment Party under the banner of justice for humanity. This party even contested 221 out of the 225 seats in the recently concluded Karnataka Assembly elections with a 'diamond’ as its symbol. It is rumoured to have lost large sums of money. This and other rumours has triggered panic among people who want their money back. 
 
Heera Group claims to be a gold trading company with business all over the world. In the past four years, the lack of any enforcement action by investigation agencies has allowed it to grow rapidly and diversify into diverse business. In the past two years Moneylife has raised the issue of Heera Gold's Ponzi operations with two SEBI Chairman — Mr UK Sinha as well as Mr Ajay Tyagi — because it operated like a vast collective investment scheme. Neither of the two SEBI chairmen bothered to respond.  
 
Our communication we said, "We hope SEBI will take note of this and hasten action so that people do not end up losing money. Many women too are being conned into borrowing against property to invest in these companies on the claim that the returns would be significantly higher than the interest they would pay on their loans."
 
Investigations and information by a premier government agency, perused by Moneylife, claim that Heera Gold is involved in hawala activities. The note lists various actions against the group. For instance, on 17 May 2014, the Hyderabad Police apprehended six accused, while Heera Group promoter, Dr Shaik was named an absconding accused. Subsequently, on 21 May 2014, the Enforcement Directorate (ED) searched Heera Group premises and seized documents pertaining to the illegal transfer of money through hawala.
 
In August 2012, Asaduddin Owaisi, member of parliament (MP) from Hyderabad, had registered a case against Dr Shaik for cheating a large number of local investors from his constituency. The Hyderabad Police are investigating this case as well.
 
The Heera Group began its operations in 2010 and since then, claims to have created 25 legal entities. Of these, only 10 were found to be registered on registrar of companies (ROC), Hyderabad and only four are found to have filed balance sheets (FY2012-13), which are being analysed. It is not registered under FCRA, says a government source.
Like this story? Get our top stories by email.

User

COMMENTS

Saqib Mohammed

5 months ago

What are regulators doing about other Ponzi schemes like IMA (I Monetary Advisory) which runs on similar lines and promised 30%+ return?

Zahir Lala

5 months ago

Such Ponzy Scheme Company goes hand in hand with Govt org like SEBI & EOW.
This Ponzi scheme company sets particular financial targets. Once the targets are achieved they gets the offices raided by EOW & SEBI and than all drama follows. owner is now arrested but for how long? nothing will be done against her, just wait and watch.
Time and again, a ponzi scheme company is established and innocent citizen gets trapped.

tanay

5 months ago

This has been possible only due to the untiring efforts of one man, Mr. Shahbaz Ahmed khan

Rajendra Ganatra

5 months ago

Too much. Ponzi scheme for so long. Our regulators are shaken only when crisis occurs when there is nothing to retrieve.

We are listening!

Solve the equation and enter in the Captcha field.
  Loading...
Close

To continue


Please
Sign Up or Sign In
with

Email
Close

To continue


Please
Sign Up or Sign In
with

Email

BUY NOW

online financial advisory
Pathbreakers
Pathbreakers 1 & Pathbreakers 2 contain deep insights, unknown facts and captivating events in the life of 51 top achievers, in their own words.
online financia advisory
The Scam
24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
Moneylife Online Magazine
Fiercely independent and pro-consumer information on personal finance
financial magazines online
Stockletters in 3 Flavours
Outstanding research that beats mutual funds year after year
financial magazines in india
MAS: Complete Online Financial Advisory
(Includes Moneylife Online Magazine)