Amway India is accused by the ED of accused of running a pyramid fraud in the guise of a multi-level marketing network. The company is famous for selling beauty and wellness products in over 100 countries. So, Amway India Pyramid Fraud Case against Amway is really not good news for the business. Recently India's Enforcement Directorate (ED) on April 19 accused Amway India of running a “multi-level marketing (MLM) scam” and provisionally attached its assets worth Rs 757.77 crore.
|Amway India Pyramid fraud case by ED news|
To know complete detail about Amway India Pyramid Fraud Case, read an article about why has the ED accused Amway India and attached Amway India’s assets worth Rs 757 crore?
Enforcement Directorate (ED) case against Amway India statement
Directorate of Enforcement is a specialized financial investigation agency under the Department of Revenue, Ministry of Finance, Government of India, and all direct selling companies are regulated and monitored by ED.
What is Amway India Pyramid Fraud Case?
Every MLM company must focus on selling products and services to consumers to gain profits. But some MLM businesses mainly focus on adding new members and providing high commissions from newly joined. Which is illegal and termed a Pyramid Scheme.
The Enforcement Directorate accused Amway India of running a multi-level marketing "scam" where it focused on signing up new members so that senior staff could earn a commission.
According to the Official Statement by Enforcement Directorate -
The main reason for Amway Fraud and many MLM fraud is -
The entire focus of the company is about propagating how members can become rich by becoming members. There is no focus on the products. Products are used to masquerade this MLM pyramid fraud as a direct-selling company,
“It is observed that the prices of most of the products offered by the company are exorbitant as compared to the alternative popular products of reputed manufacturers available in the open market,” the ED said.
Amway India Fraud Case Assets and Properties Attached details
- The ED issued a provisional order under the Prevention of Money Laundering Act (PMLA) for the attachment of assets worth Rs 757.77 crore belonging to Amway India Enterprises Private Limited.
- The attached properties include land and factory buildings of Amway located in the Dindigul district of Tamil Nadu, plant and machinery, vehicles, bank accounts, and fixed deposits.
- Attaching a property means it cannot be transferred, converted, or moved.
- Out of the total ₹ 757.77 crores of assets attached under the Prevention of Money Laundering Act (PMLA), immovable and movable properties are worth ₹ 411.83 crores while the rest are bank balances of ₹ 345.94 crores kept in 36 accounts belonging to Amway.
Amway Reply to ED in Defence
Amway India is one of the country's well-known multi-level marketing (MLM) and direct-selling companies all over the world. India has been a key market for Amway along with China, the US, Japan, Thailand, and Taiwan.
After the Amway India Fraud Case by ED, In defense of all accused fraud cases by the ED Amway has strongly replied to this.
Responding to the charges in a statement, Amway India said -
"The action of the authorities is with regards to the investigation dating back to 2011 and since then we have been cooperating with the department and have shared all the information as sought from time to time since, 2011. We will continue to cooperate with the relevant government authorities and the law officials towards a fair, legal, and logical conclusion of the outstanding issues."
In addition to this, they also put a response on their effects on business reputation.
As the matter is sub judice, we do not wish to comment further. We request you to exercise caution, considering a misleading impression about our business also affects the livelihood of over 5.5 lakh direct sellers in the country
They are cooperating with the authorities towards a fair, legal, and logical conclusion of the outstanding issues.
So, this was an Amway India Fraud Case as Pyramid Fraud Case details. I tried to put it all in summary format to understand clearly hope you like this article.
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