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  • Amway India Post 20% growth in 2012

    Amway India Post 20% growth in 2012

    Amway India made a turnover of Rs 2288 crore for the fiscal year 2012 with growth of over 20 %.

    In 2012 Amway did Rs 100 crore business from Gujarat, against Rs 85 crore in 2011 and Rs 67 crore in 2010.

    Sandeep Prakash, Associate Vice Head of state, Amway India West stated, “The double-digit growth for the last 5 years is buoyed by the launch of products in health and beauty, penetration of items in semi urban and rural markets of the state and the remarkable effort put by the suppliers.”.

    Currently Amway has 135 offices pan-India out of that, 50 % of Amway offices are in villages and cities. Amway is rising and getting optimistic results in the states of Gujarat, Maharashtra, West Bengal, Karnataka, Delhi & UP.

    It is expected that Amway’s first new Tamil Nadu facility to commence manufacturing by mid-2015 and the same would  cut its dependency on imports for premium Artistry brand of products. Currently India contributed total 5 % of company volumes in 2012, where as China provided near 35 %.

  • Kerala Government Soon To Pass Bill To Regulate MLM

    Kerala Government Soon To Pass Bill To Regulate MLM

    Soon Kerala will become the first state to pass law on MLM industry in India. The bill on MLM will be presented in the assembly in coming session.  All the aspects related to the control and the operations of MLM companies in Kerala has been discussed and same to be presented in the assembly during the next session.

    The Bill will clearly distinguish MLM and Direct Selling companies and exclude the latter from the Prize Chits and Money Circulation Scheme (Banning) Act, 1978.

    Some time back, the ceo of Amway was arrested by Kerala authorities under PCMC act, and that caused lot of tension among other direct selling companies in India, some say, this might have triggered the formulation of the Bill.

    The bill will eventually help direct selling companies from being charged under PCMC act.

    The Bill was jointly drafted by industries secretary and along with representatives of home,law,commercial taxes and consumer affairs departments.

    They recommended a constitution on mlm to regulate and same to be regulated by an authority in the state for the registration,control and supervision on MLM companies. The authority shall also have the same powers as are vested in a civil court under the code of civil procedures 1908 while trying a suit.

    On the other hand, central government is already working with 7 member committee on a national level Bill to control the MLM business.

  • Government conducting probe against 154 companies, Sachin Pilot’s Reply to Rajya Sabha

    Government conducting probe against 154 companies, Sachin Pilot’s Reply to Rajya Sabha

    The central government is probing grievances of financial scams against 154 companies, which also includes those connected with Saradha Group and Rose Valley Group, Parliament was informed today by Sachin Pilot.

    In a written reply to Rajya Sabha, Sachin Pilot said ” We received complaints against 154 companies/organizations during the last 3 years,”

    Pilot stated his ministry has ordered probe of the balance sheets and various other files in these cases.

    “Some cases have been referred to the Economic Offences Wing of the concerned state government for additional examination,” he added.

    As per the list provided by the Minister, the complaints also include against 10 Saradha Group entities such as Saradha Realty, Saradha Agro Development, Saradha Exports and Saradha Garden Resorts & Hotel.

    Besides, the list includes names of 14 entities related to Rose Valley Group consisting of Rose Valley Industries, Rose Valley Marketing and Rose Valley Hotels and Entertainment.

    Vaishnavi Corporate Communication, Speak Asia, Reebok India, Alchemist Infra are among the various other business entities, against whom grievances were also received and they are also under probe because of their names in the list.

    Questions were also raised, like what steps are being initiated by the government to detect corporate wrongdoings.

    Pilot said “the ministry is in the procedure of developing an early warning system to recognize cases of frauds or possible scams at the earliest.

    “Pilot said, the testing of the early warning system is anticipated to be finished during 2013-14,”

    In addition, Pilot said, numerous measures had been embarked on to safeguard the investor’ interests with programs on awareness and education.

    Some of these steps include issue of multi-lingual print media ads from time to time to warn the investors about fraudulent investment schemes, MCA-21 site for lodging complaints and for tracking their status and a system of sending out SMSes cautioning investors.

    If you have any issue with your present company, you may directly register your complaint with Ministry Of Corporate Affairs by this link : http://goo.gl/xEwpSp

  • Mizoram Direct Marketing Limited has No connection With Mizoram Government

    Mizoram Direct Marketing Limited has No connection With Mizoram Government

    Finally, Mizoram government disowned Mizoram Direct Marketing Limited, a company which claimed itself to be a state government’s joint venture with RMP Infotec. A strict disciplinary action would be taken against the senior IPS officer, who is said be behind all this.

    A disclaimer issued by the chief secretary’s office said Mizoram Direct Marketing Limited, signed up under the Companies Act 1956 on March 11, 2013 was launched by Principal Secretary of the state Industries division P C Lallawmsanga in his personal capacity, and not on behalf of the government of Mizoram.

    Mizoram govt. disclaimer on mizodirect: http://www.mizoram.gov.in/documents/19/c3250786-f970-4caa-91b7-82f7029b6ad9

    Click to download disclaimer: Attachment

    The disclaimer said” If government officials float any business then they require Mizoram government’s policy decision taken by the Cabinet, where as in Mizoram Direct Marketing Limited no such prior approval was taken.

    Lallawmsanga, Principal Secretary of the state Industries has not been authorized to sign the MoU between the state government and Chennai-based RMP Infotec Pvt Ltd. Chief Secretary, L Tochhong on Thursday told media persons that the government was contemplating taking disciplinary action against Lallawmsanga, a 1984 batch Tamil Nadu cadre IPS officer holding the rank of Additional DG of Police.

    Punitive action will be taken against 2 more directors – Teresy Vanlalhruaii and Lalbiakthanga Chhakchhuak, sources stated.

    Mizoram Chief Secretary informed Lallawmsanga not to attend the Kolkata launching function, but latter disobeyed her orders claiming that he has blessing of the state chief minister.

    It is also suspected that some other government officials in the state Information and Communication Technology department and National Informatics Centre (NIC) were involved as the website was also reportedly designed by the state government-owned Zoram Electronics Development Corporation Ltd. (ZENICS). In the recent update: Lallawmsanga, Industries secretary suspended.

  • Ponzi Schemes Vs direct selling companies

    Ponzi Schemes Vs direct selling companies

    There are few things to keep in mind while differentiating between a ponzi scheme and a direct selling company. As per Wikipedia, the definition is given below. Rest in detail, you can read the points to understand more about ponzi schemes and direct selling companies.

    As per Wikipedia, A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors, rather than from profit earned by the individual or organization running the operation. The Ponzi scheme usually entices new investors by offering higher returns than other investments, in the form of short-term returns that are either abnormally high or unusually consistent. Perpetuation of the high returns requires an ever-increasing flow of money from new investors to keep the scheme going.

    • In a Direct selling company, the distributor is given commission, when the services or the products taken by the distributor for personal use or when it is sold to others.
    • In a ponzi scheme, the earning to the network depends on recruitment of new people into the network.
    • In a genuine Direct selling company, the products or the services of the company are already established in the market place.
    • In a ponzi scheme, most of the times, the start-up cost to join is very low and the products or the services they offer are not recognized in the market place, basically they are cheap. It means, the person who is not connected to the company would not buy the product at the rate they are being sold.
    • In a genuine Direct Selling company, the entry to get started and the cost of starting to sell for a certain market for the first time is quite low.
    • In a genuine direct selling company,  the option to exit are always available.
    • In a ponzi scheme, they do not offer exit option.
    • In a direct selling company, a newly signed up person can earn even more than the person who had actually joined above and/or earlier than him.
    • In a ponzi scheme, the person who joined as an early bird makes more money than the person who joins after him.
    • In a direct selling company, the focus is on sales of products/services and therefore they emphasize on good amount of product training.
    • In a ponzi scheme, the focus is on meetings and recruiting of new participants into the system..
    • In a direct selling company, the business model is based on selling of the products/services to the right consumer and rewarding the people, who top the list.
    • In most ponzi Scheme, there are no functions, and no real trading occurs. The cash from new members is distributed among the ones, who started earlier. To make it simple, its rotation of money and nothing else. Currently, most ponzi schemes are involved with collection and distribution of money from external sources like Foreign exchange trading,  Stock exchange, Surveys, Blogging, Time shares, Emu farming, Goat farming, buying gold or land, etc.
    • In a direct selling company, the compensation plan which pay (from the margin assigned per product for distribution to the network) their distributors on the basis of products or services sold, not on recruiting.
    • In a ponzi scheme, the money taken from people against guarantee of a high returns in the future. Their business plan is unsustainable, considering that it assures returns which fully rely on getting financial investments from new members.
  • StockGuru India Mastermind Jailed, Wife is Already In Jail

    StockGuru India Mastermind Jailed, Wife is Already In Jail

    StockGuru India mastermind Lokeshwar dev jain was sent to jail in Ratnagiri, Maharashtra. Priyanka Saraswat Jain, wife of the accused has already been jailed two days ago on same charges.

    On production warrant, the local police arrested the accused of StockGuru India and brought them to police station from Tihar jail.

    ASI, Om kumar, said” the accused couple defrauded people mostly of  Delhi, Bhopal, Dehradun, Jaipur, Sikkim and many other places through their chit fund offices and they had also opened their regional offices at these places ” .

    People were lured into the scam business by asking them to invest 10 thousand rupees and in return they were offered 20% rate of interest every month. Every time, they changed their names, when they scammed people in the past fraud cases.

    Lokeshwar dev jain and Priyanka Saraswat Jain married each other just few years ago and hatched these scam plans together. They also have two children, who are now in Ratnagiri orphanage.

    Delhi police and income tax department have already seized their movable and immovable properties.

  • Mary Kay Exits India Pointing Out Regulatory Concerns & Poor Sales

    Mary Kay Exits India Pointing Out Regulatory Concerns & Poor Sales

    Direct selling brand Mary Kay India finally ended its Indian operations pointing out regulatory concerns and due to the slow growth from the very beginning. Mary was also a member of IDSA.

    Same development news was also communicated to the suppliers and also to the Mary Kay representatives in India.

    Mary Kay Inc stated: “We have actually seen the regulatory environment in India for both direct selling and cosmetics companies substantially change and change once again at a disconcerting and inconsistent rate, while the nation’s infrastructure continues to create overwhelming barriers. In spite of significant investments of time and money, our operation in India has not performed as we had hoped and anticipated. So, we have actually made the choice to reallocate the company’s resources to other international markets.”.

    Mary Kay Inc come to India in 2007 and has invested close to $20 million in its venture. They launched a number of India-specific products and had nearly 100 stock-keeping units in categories such as skincare, fragrances and cosmetics.

    They were also thinking of setting up a third-party manufacturing facility in Baddi, Himachal Pradesh.

    Mary Kay, which has 2.5 million distributors in about 35 markets worldwide, ended up being popular for providing pink Cadillacs to its leading sales persons. In India, it had about 4,500 beauty agents and 4 third-party warehouses.

    Lot of other direct selling brands have raised the same concern. The ambiguity in mlm laws in India is giving negative prospects. With the same concern, soon the World Federation of Direct Selling Associations (WFDSA) is planning to hold its first meeting in India with various stakeholders to address the industry’s concerns.

    Our Take: Surely, it is not a good sign. The government of India has been postponing the regulation required for the direct selling industry for a very long time. The other big players such as Amway, Oriflame, Tupperware and Herbalife have already raised same concerns in the past. Something must be done at the earliest to show confidence to good direct selling companies before other big players think of  making same move.

  • SpeakAsian Vivek Sharma alias Aman Azad’s Anticipatory Bail Plea Denied

    SpeakAsian Vivek Sharma alias Aman Azad’s Anticipatory Bail Plea Denied

    The Bombay high court on Friday rejected the anticipatory bail application of Vivek Sharma, who is also called with a nick name, Aman Azad in the SpeakAsia fraud case. He started as an agent for SpeakAsia but later on, he ended up earning lot of money through SpeakAsia fraud. The court also asked the police to apprehend Azad as early as possible.

    “Azad has filed an anticipatory bail application prior to the HC a couple of months ago and hearing was on. On Friday, the court declined his ABA application and asked to arrest him without any delay. Furthermore, he was not present in the court room during the hearing,” explained BP Shelke, he is also the chief investigating officer in this case.

    SpeakAsia  ripped off over 24 lakh investors with total of  Rs 2,276 crore. Police till date apprehended over 15 leaders, sympathizers or office bearers of the SpeakAsia. The top brass of the company are also required in the case but they are hiding in foreign countries.

    “After SpeakAsia’s business was shut down, Azad started managing the internet site of the firm and lured investors that the police have not made any case against SpeakAsia and soon it will re-start working again. He was also managing the All India SpekaAsia panelists organizations (AISPA) website. We have actually traced its server and are thoroughly keeping an eye all those people who are posting comments and remarks on the website,” said an officer.

  • Beware Of These Dialy Frofit,Forex & High-Yield Investment Program Companies

    Beware Of These Dialy Frofit,Forex & High-Yield Investment Program Companies

    The names of companies given below are of serious fraud nature. All these companies are either based on Forex, HYIP and so-called helping plans like defunct MMM India.

    Names of companies with high risk Unviable Business Plan:

    Few things you should keep in mind, while investing in such companies:

    • If a company is operating from a foreign soil, then big no to the opportunity.
    • Ask for Legal Registration as per Indian laws.
    • To swindle money, most fraud companies take help of online gateways such as perfectmoney.com, egopay.com, solidtrustpay.com etc, (we already know what happened to liberty reserve)
    • Ask for names and the contact information of owners.
    • Ask if payment slip is given after depositing the cash.

     

    As per RBI “Remittance in any form towards overseas foreign exchange trading through electronic/internet trading portals is not permitted under the Foreign Exchange Management Act (FEMA), 1999. The reserve bank has also clarified that the existing regulations under FEMA, 1999 do not permit residents to trade in foreign exchange in domestic / overseas market.

    Here is the RBI Notification on FOREX: https://networkingeye.com/2011/04/rbi-notification-on-forex-trading/

    Recently RBI also cautioned, that if any company, who offers more than 12% return on your investment in a year are of high risk nature and you could also lose your hard earned money as well.

    Soon we will publish detail report on some of the above companies. The report will focus, how these companies at the end of their business cycle turns out to be a scam.

  • IDSA & Members Seeking Cilarity on MLM Regulations

    IDSA & Members Seeking Cilarity on MLM Regulations

    In order to get legal sanctity and recognition from both central and state government authorities, the Indian direct sellers like Tupperware, Amway, Oriflame and their association body IDSA might quickly approach the commerce ministry in coming days.

    Right now direct selling sector is of Rs 7,000-crore in India with 18  companies who are promoting through direct sales are seeking the clear meaning of “direct sellers” and distinction from multi-level marketing entities, including those dealing in money circulation schemes.

    On the other hand, Amway representatives in the United States are preparing to satisfy commerce minister Anand Sharma, who is presently on an official visit to United States.

    “We will prepare a strategy paper and approach the commerce ministry soon. Our proposals of own set of strict guidelines for identifying real direct sellers from the rest are being studied by the finance ministry. We are hopeful that something favorable could come out in a month’s time,” Chavi Hemanth, secretary-general of the Indian Direct Selling Association stated.

    Nevertheless, government sources showed that both the consumer affairs ministry and the department of financial services are against  exclusion of direct selling entities such as Tupperware, Amway and others from the ambit of Reward, Chit Funds and Money Circulation (Banning) Act, 1978. Both are presently examining the link in between illegal profitable schemes, including ponzi schemes, pyramid schemes and those promoted by the multi-level marketing companies.

    Sources in the customer affairs ministry are of the view that instead of a main regulator or a main law, these direct selling entities ought to be subjected.