CFW appeals to the government to implement the G.O.against Amway

March 8, 2013, 3:49 am

≫ Next: SEBI moves SC for arrest of Sahara chief

≪ Previous: The bubble of finance company Abhaya Gold burst

$

0

0

Corporate Frauds Watch wrote a letter on 8-3-2013 to the chief minister of Andhra Pradesh and principal secretary of Home department to implement the G.O.M.S. No 178 of 2008 restraining Amway India from advertising in any media including internet regarding its illegal business model. This is in view of the latest judgement issued by the AP High Court refusing to entertain the plea of Amway India to review the judgement stating that there was nothing to review and the writ petition on the G.O. could be heard by the division bench. Now the division bench would hear the writ petition on the G.O.

Dated: 8/3/2013

To

The Principal secretary,

Home Department,

Government of A.P.,

A.P. Secretariat,

Hyderabad.

Respected Sir,

Sub:       Promotion of illegal Money Circulation Scheme by Amway – Non-implementation of G.O. restraining Amway from issuing advertisements to promote its illegal scheme – Reg,

Ref:        G.O.Ms.No.178 (Home General-B) Department, dated 15/9/2008.

*****

1.            I respectfully submit that we are Corporate Frauds Watch Society, Vijayawada which is a Non-Political, Non-profitable, Non-Governmental and Voluntary Organisation. We have been espousing the social cause of creating awareness against the illegal Money Circulation Schemes and frauds.

2.            It is bring to your notice that Amway India Enterprises has been promoting illegal Money Circulation Scheme in the guise of Multi-Level Marketing and looting and cheating the public.  On that a criminal case was registered against Amway and its members by C.I.D. in the year 2006.  On that Amway went to Hon’ble High Court of A.P. to declare its activities does not fall under the provisions of Money circulation scheme, but after due enquiry, the Hon’ble Division Bench of High Court of A.P. held that the scheme floated by the Amway falls under the provisions of Money Circulation Scheme in WP No.20470 and 20471/2006. Subsequently, Amway approached the Hon’ble Supreme Court of India but the Hon’ble Supreme court of India also dismissed the SLP filed by Amway. Thereafter CID police filed charge sheet in the criminal court.

3.            It is further bring to your notice that the Government of A.P. issued a G.O. cited in the above reference restraining the Amway from giving advertisements in print and electronic media. Amway again approached the Hon’ble High Court of A.P. but the Hon’ble High Court did not stay the operation of G.O. Supreme Court of India also did not stay the operation of G.O. issued by the Government of A.P. But unfortunately, the G.O. is not being implemented by the Police department though Amway is aggressively issuing advertisements and no stay was granted by any court against the operation of G.O. issued by A.P. Govt.

4.            Hence, I request to kindly look into the matter and initiate action in this regard in the interest of general public from being cheated, for which we are grateful to you sir. I am herewith attaching the G.O. cited in the above reference for kind perusal and information.

Yours faithfully,

(M.Shyam Sundar)

Secretary.

To                                                                                                                                                           Dated: 8/3/2013

The Chief Minister,

Government of A.P.,

A.P. Secretariat,

Hyderabad.

Respected Sir,

Sub:       Promotion of illegal Money Circulation Scheme by Amway – Non-implementation of G.O. restraining Amway from issuing advertisements to promote its illegal scheme – Reg,

Ref:        G.O.Ms.No.178 (Home General-B) Department, dated 15/9/2008.

*****

1.            I respectfully submit that we are Corporate Frauds Watch Society, Vijayawada which is a Non-Political, Non-profitable, Non-Governmental and Voluntary Organisation. We have been espousing the social cause of creating awareness against the illegal Money Circulation Schemes and frauds.

2.            It is bring to your notice that Amway India Enterprises has been promoting illegal Money Circulation Scheme in the guise of Multi-Level Marketing and looting and cheating the public.  On that a criminal case was registered against Amway and its members by C.I.D. in the year 2006.  On that Amway went to Hon’ble High Court of A.P. to declare its activities does not fall under the provisions of Money circulation scheme, but after due enquiry, the Hon’ble Division Bench of High Court of A.P. held that the scheme floated by the Amway falls under the provisions of Money Circulation Scheme in WP No.20470 and 20471/2006. Subsequently, Amway approached the Hon’ble Supreme Court of India but the Hon’ble Supreme court of India also dismissed the SLP filed by Amway. Thereafter CID police filed charge sheet in the criminal court.

3.            It is further bring to your notice that the Government of A.P. issued a G.O. cited in the above reference restraining the Amway from giving advertisements in print and electronic media. Amway again approached the Hon’ble High Court of A.P. but the Hon’ble High Court did not stay the operation of G.O. Supreme Court of India also did not stay the operation of G.O. issued by the Government of A.P. But unfortunately, the G.O. is not being implemented by the Police department though Amway is aggressively issuing advertisements and no stay was granted by any court against the operation of G.O. issued by A.P. Govt.

4.            Hence, I request to kindly look into the matter and initiate action in this regard in the interest of general public from being cheated, for which we are grateful to you sir. I am herewith attaching the G.O. cited in the above reference for kind perusal and information.

Yours faithfully,

(M.Shyam Sundar)

Secretary.

---

SEBI moves SC for arrest of Sahara chief

March 15, 2013, 10:49 pm

≫ Next: Finance, real-estate firms owned by brothers raided

≪ Previous: CFW appeals to the government to implement the G.O.against Amway

$

0

0

By PTI - NEW DELHI 15th March 2013 02:41 PM

SEBI on March 15th moved the Supreme Court seeking arrest of Sahara  group promoter Subrata Roy Sahara and barring him from leaving the country after two companies of the group failed to comply with court's order to refund Rs 24,000 crore to its investors.

The market regulator mentioned the matter before a bench headed by Justice K S Radhakrishnan which agreed to hear its plea and posted the case for hearing in the first week of April.

SEBI urged the court to allow it to "take measures for arrest and detention in civil prison of promoter of Sahara Subrata Roy Sahara and the two male directors---Ashok Roy Choudhary and Ravi Shankar Dubey ---after giving reasonable opportunity of hearing."

SEBI also sought direction that their passports be deposited with the Supreme court.

Sahara group and SEBI are locked in legal dispute over the refunding of 24,000 crore by its two companies--Sahara India Real Estate Corporation (SIREC) and Sahara Housing Investment Corporation (SHIC)--to its investors.

Earlier, the last hope of Sahara group to get more time to refund Rs 24,000 crore to its investors was today dashed in the Supreme Court which dismissed its plea and pulled it up for not complying with the court's earlier order to return the money by first week of February.

A bench headed by Chief Justice Altamas Kabir, which had earlier extended the deadline to two companies of the group for refunding the money from November end to first week of February, had refused to grant more time.

SIREC and SHIC along Roy are facing contempt proceedings in the apex court before another bench which had on February 6 allowed SEBI to freeze accounts and seize properties of its two companies for defying court orders by not refunding the money to investors.

http://newindianexpress.com/business/news/article1502815.ece

Finance, real-estate firms owned by brothers raided

March 28, 2013, 4:36 am

≫ Next: Promoters of fraud firms sent to jail

≪ Previous: SEBI moves SC for arrest of Sahara chief

$

0

0

Sending shock waves down the spine of scores of illegally-operating financial and real-estate business establishments across Prakasam district, the Prakasam district police headed by Superintendent of Police Dr Raghuram Reddy on Sunday raided offices of Nakshatra Real Estates and Maitri, a finance company-- owned by two brothers-- for alleged frauds involving several crores of rupees. A case of cheating was registered against the Nakshatra company. However, the police so far has not booked Maitri for any misappropriation of funds.

The police reportedly carried out the raids to prevent the two companies from jeopardizing interests of the investors. A large number of customers who purchased plots and depositors invested in finance schemes are worried over the latest development.  

While the raid on Nakshatra firm followed a complaint given by a victim to the One Town Police here, the searches in the money circulation company of Maitri were prompted by suspected siphoning of depositors’ funds.

The police have received complaint that the real-estate company had cheated by assigning plots not owned by the firm. He alleged that some of the plots that formed the venture of the real-estate company were located in assigned land. During the raids, the police reportedly recovered crucial files pertaining to different ventures. Based on the evidence of cheating during the questioning of the company organisers, the police chose to register a case.

Both the police and management of the real-estate firm were reluctant to share information about the raids creating anxiety among the clients who purchased plots and invested their hard earnings in the ventures. The firm reportedly sold hundreds of plots in the name of different ventures. Now, the buyers are puzzled on the number of plots made out of government lands.

On the other hand, depositors of money circulation schemes who pumped in their daily wages with the hope of better future are equally concerned over the fate of their investment.

The police raided main branch of Maitri here and seized several files. The police have crucial information about funds diversion to the Nakshatra company. Incidentally, the two companies belonged to the same family and owned by two brothers.

The private finance firm reportedly collected huge sums of money accounted for several crores of rupees from poor and daily-wage workers in the name of different money-growth schemes.

The company is stated to have slipped into serious financial crisis as the money was diverted to the real-estate firm. The company is reportedly facing difficulty in repayments because of the slump in real-estate for a long period. In this backdrop, the finance firm opted to shut some of its branches in the district much to the nervousness of the depositors. The police anticipated that the company may announce insolvency anytime and took action to avoid financial loss to depositors.  

Promoters of fraud firms sent to jail

April 2, 2013, 12:14 am

≫ Next: Indian Express-ICIJ probe: Vijay Mallya, Ravikant Ruia in tax havens

≪ Previous: Finance, real-estate firms owned by brothers raided

$

0

0

An Ongole court on Monday remanded the three arrested organisers of Maitri Finance and Nakshatra Real-estate companies for 14 days. They were sent to Prakasam district jail.

The Ongole One-Town Police produced the accused brothers —Lakku Madhava Reddy, Lakku Malyadri Reddy and Lakku Konda Reddy— in the court by booking them under the provisons of the Prize Chits & Money Circulation Schemes (Banning) Act, 1978 Section 420 of IPC for cheating and land grabbing cases.

Cases against 10 others were also registered for financial fraud as part of the money-circulation schemes offered by the two firms run in violation of rules.

Indian Express-ICIJ probe: Vijay Mallya, Ravikant Ruia in tax havens

April 4, 2013, 4:53 am

≫ Next: LURE OF LUCRE MAY LAND YOU IN TROUBLE

≪ Previous: Promoters of fraud firms sent to jail

$

0

0

The 612 Indians on the list of those who have invested in tax havens such as the British Virgin Islands include two MPs, a former royal and top industrialists. RITU SARIN puts together details of 20 among them

SONU LALCHAND MIRCHANDANI

Mirchandani is the founder of popular consumer electronics firm Onida. Mirchandani and his wife, Soni, opened a BVI company called Strong Wing Overseas Ltd in 2006 with an authorised capital of $50,000. Both are directors and shareholders of the company.

Mirchandani, however, said he did not recall opening such a BVI entity. "The personal details in the papers are mine. Maybe someone else has opened the company in my name," he said when shown the documents.

Investigation finds 612 Indian firms in tax havens

TEJA RAJU

Teja is the eldest son of Ramalinga Raju, the disgraced former chairman of Satyam Computers Ltd. Teja is said to be the brain behind Maytas Infrastructure, whose planned merger with the software giant went on to unravel the alleged corporate fraud that sent Ramalinga Raju to jail for 32 months.

The Rajus set up two BVI companies, Global Network Overseas and Stapley Universal Limited. Teja Raju is listed as the beneficial owner of both but records show their current status as "defunct". Each company was registered with an authorised capital of $50,000.

Teja Raju denied any link with the companies. "Looks like a case of mistaken identity," he said.

RAVIKANT RUIA

An NRI, Ruia is vice-chairman of the Essar group, which has interests in steel, oil, gas and power. His company has been embroiled in the alleged irregularities in the telecom spectrum allocation of 2001-02; last month, a special court named Ruia an accused.He has registered three firms in the BVI and his daughter Smiti is a shareholder in two of them. Also, one of Ruia's flagship companies, Essar Power, has five BVI accounts with their authorised capitals ranging from $100 to $100,000.

Essar officials said that of the eight companies, five were liquidated in 2011 and 2012 and three are "existing and operational". They said necessary filings and compliance have been done in India in accordance with laws and Smiti has declared her holding in Paprika Properties Ltd and Paprika Holdings Management Ltd in her wealth tax returns. "These companies were started as SPVs to make investments and are in the knowledge of the authorities concerned," Essar said.

RAMAKRISHNA KARUTURI

Bangalore-based Karuturi is the chairman of Karuturi Global Ltd, the largest producer of cut-roses in the world. He has diversified into farming and has leased 300,000 hectares of land in Ethiopia to produce cereals and edible oil.

In 2007, Karuturi registered companies in tax havens and with huge authorised capitals. He is shareholder or beneficial owner of six companies that have a collective authorised capital of $2.2 million. His wife, Anitha, is also a shareholder in one company, Maxworth Investment Ltd.

Reached in Ethiopia, Karuturi said he did not recall the companies and did not respond to subsequent calls.

VIJAY MALLYA

The other MP on the list, Mallya registered a BVI company called Venture New Holding in 2006 with an authorised share capital of $50,000. Mallya, who has been in the news for the trouble over his Kingfisher Airlines and with the tax authorities, is the beneficial owner of the firm."Dr Mallya is a non-resident Indian with business activities in different parts of the world. It is common practice to use BVI registered companies in connection with such activities which are not confined to India alone. All disclosures in regard to Dr Mallya's wealth have been duly made to Parliament," a UB group spokesperson said.

VIVEKANAND GADDAM

Gaddam is a Congress MP from the Peddapalle reserved constituency in Andhra Pradesh. The seat was earlier represented by his father, former union minister G Venkatswamy. Gaddam, who has a MBBS degree, is an industrialist and owns asbestos firm Visaka Industries. He is also chairman of CII's Andhra Pradesh chapter.

Gaddam and his wife, Saroja, became directors and shareholders of British Virgin Islands (BVI) company Belrose Universal Ltd in 2009. The address mentioned in documents is the official Hyderabad address that is also mentioned in his Parliamentary records.

Reached for his comment, Gaddam said he was not aware of the existence of any such offshore company. "I do not remember being involved with such a company and have no connection with it," he said.

ABHEY KUMAR OSWAL

Son of Ludhiana-based business tycoon Vidya Sagar Oswal, Abhey is chairman of Oswal Agro Mills and Oswal Chemicals and Fertilizers and managing director of Oswal Spinning and Weaving Mills. In 1999, tax authorities raided his establishments for suspected evasion.

He is one of the biggest Indian players on the BVI list. Starting in 2006, he registered 11 companies in Samoa and the BVI and controlled them through the Rising Wealth Trust, registered in the Cook Islands. While the trust owns shares in several of the companies, Abhey owns shares in others. Abhey is the protector of the trust and his son Shael is the settler. The combined authorised capital of the 11 companies is $5.3 million."I have not registered any offshore firms. You must be in the knowledge of business entities of my son Shael Oswal, who is a Singapore resident and an NRI. My companies or myself have no relation whatsoever with his business or business entities," Abhey said.

SAMIR MODI

Son of top industrialist K K Modi, who owns the diversified Modi Enterprises, Samir is an executive director in Godfrey Philips. He pushed the group's diversification by launching a string of new ventures such as Modicare, Colorbar and Twenty Four Seven.

His BVI company is called Gilvin Rock Enterprise Limited. He and his wife, Shivani, are joint directors and shareholders in the firm ,which has an authorised capital of $50,000. "The company was set up as a route for investments but hasn't done any business or trade transactions," he said.

CHETAN BURMAN

Chetan Burman is a fifth-generation member of the Burman family, which owns the Rs 1,500 crore ayurvedic and food products brand Dabur. He was executive director of Dabur Nepal but has now branched out into other ventures.

Burman registered a BVI company in 2007 called Heavenly Bloom World Ltd. He is both director and shareholder of the company, which started with an authorised capital of $50,000.

Burman said the BVI firm was set up to route exports, mainly of honey, through Singapore but that plan didn't take off. "The company was set up through a verbal communication since I wanted to make Singapore the export hub for my products. But no trade transactions actually materialised and the company has thus remained dormant," he said.GAEKWAD RADHIKARAJE SAMARJITSINH

In January 2008, members of the former royal family of Baroda opened a BVI firm with an authorised capital of $50,000. The directors and shareholders of the company, called Brentwood Consulting Limited, are Gaekwad Radhikaraje Samarjitsinh, wife of Samarjitsinh Gaekwad, and her sister Kumari Meenal. The Laxmi Vilas Palace, one of the largest residences in the country, is given as Radhikaraje's address in documents.

She did not respond to questions sent to her.

RAHUL MAMMEN MAPPILLAI

The founder of MRF Tyres, the late K M Mammen Mappillai, was among those on the list of 18 people who had accounts in the European tax haven of Liechtenstein. It has now come to light that members of the MRF family registered a BVI company, Moon Mist Enterprise Limited, in 2007 with an authorised capital of $50,000. Its directors are Mammen Mappillai's two sons, MRF chairman Kandathil Mammen and its MD Arun Mammen. Kandathil's son Rahul Mammen Mappillai, also an MRF director, is the third shareholder.

Rahul did not respond to questions sent to him.

GURBACHAN SINGH DHINGRA

Dhingra is vice-chairman of Berger Paints, the second largest paint manufacturer in the country. In the BVI, Dhingra is the beneficial owner of a company called Crossley Hill Corporation. It was incorporated in 2008 with an authorised capital of $50,000.

Dhingra, however, denied any links with the company. "I have nothing to do with this company even though the address being quoted by you is my address. You must have got wrong documentation," Dhingra said.RASHMI KIRTILAL MEHTA & BHAVIN RASHMI MEHTA

The Mehtas are prominent Mumbai-based diamond traders, with a base in Belgium, and are facing allegations and action for parking money in offshore accounts. Rashmi is the son of patriarch Kirtilal Mehta and Bhavin is Rashmi's son. Some of their relatives, including Rashmi's brother Prabodh Mehta, were named in the list of 18 Indians who had accounts in the LGT Liechtenstein Bank. In April 2011, the family was raided by tax authorities and their tax evasion cases are under assessment.

Rashmi and Bhavin are directors and shareholders in a BVI company called Bapaji Inc. The company was incorporated in 2004. Another BVI company, called Dimension Worldwide Ltd, is linked to the Mehta

family but its status is described as "defunct".

The Mehtas did not respond to questions sent to them in Belgium.

LANKALINGAM MURUGESU & REETA LANKALINGAM

Known as the Papad King, Murugesu is the chairman of the Lanson Group, involved in the manufacture and export of papads. The group also owns Lanson Toyota, a Toyota car dealership of which Reeta, Murugesu's wife, is the joint MD. They also own a biotech firm called Lanson Biotech involved in ayurvedic research.

Murugesu and Reeta are joint shareholders in a Hong Kong-registered Portcullis TrustNet company called Ready On Company Limited. The company was "sold" to the couple in 2008 and began with an authorised capital of HK $10,000.

Murugesu confirmed having set up the company. "We started the company for better tax planning but with full tax now required to be paid by export units like ours, no trading through it really materialised. We just thought it is better to pay full taxes," he said.

THIAGARAJAN MURUGESAN

Breaking away from his family business of cotton trading and textiles, Murugesan launched the now-defunct Paramount Airways, a niche airline catering to the southern sector, and was its MD at the age of 28. He started five BVI companies in 2008, each with an authorised capital of $50,000. He is director and shareholder in all of them.

Thiagarajan confirmed the existence of the five BVI companies but clarified that they are "wholly owned" subsidiaries of Indian companies of the Paramount group and not individual holdings. "The BVI companies were opened with the aim of getting foreign investments in the textile business but that did not happen. So these are just companies on paper with very little or hardly any capital. Since the investments did not come in we did not activate the companies," he said.

MAITREYA VINOD DOSHI

Doshi is the chairman of Premier Ltd, formerly Premier Automobiles Ltd, one of India's oldest automobile manufacturers. He opened a BVI company called McGuffin Ltd in 2006 with an authorised share capital of $50,000 and is named as the beneficial owner.

"McGuffin Ltd has invested FDI in our Indian company with prior approval of the RBI. We regularly file all the required disclosures with the RBI as per their rules. All details of McGuffin have been given to the income-tax authorities as part of my local company's routine tax assessment, including audited balance sheets, shareholders list certified by auditors and details of investments made by it. All remittances by McGuffin have been made through HDFC Bank after due KYC checks," Doshi said.

YASHOVARDHAN LOHIA

Lohia is the CEO of Chamong Tee Exports, one of India's largest tea exporters. Lohia registered Golden Charm Universal and Golden Success Offshore Inc in the BVI in 2007 but these are now shown as "defunct".

Lohia did not respond to questions sent to him.

MEENAKSHI JATIA

One of the three daughters of the late jute baron Arun Bajoria, Meenakshi and her husband Sharad Kumar Jatia are among the claimants to Bajoria's empire, valued at Rs 2,500 crore and the subject of family disputes.

The couple are named jointly as directors and shareholders in two BVI companies, Supreme Bonus Enterprises Limited and Plazzo International Management Ltd. Each was acquired in 2007-2008 with an authorised capital of $50,000. She did not respond to questions.

SAURABH MITTAL

Mittal is a co-founder and vice-chairman of Indiabulls, the country's first e-commerce and Internet brokerage company.

BVI documents show Mittal registered a company named Alta Vista Development Corporation in 2008. He is both director and shareholder in the company, which began with an authorised capital of $50,000. He did not respond to questions put to him.

NEESHA SUNIT KHATAU, PANNA SUNIT KHATAU & REENA SUNIT KHATAU

They are heirs to the 150-year old Khatau empire. Panna is the wife of Sunit Khatau, the late chairman of the group who was shot dead in 1994. She is chairman of their flagship textile firm, Khatau Makanji Spinning and Weaving Company. Neesha and Reena are her daughters and directors of the company.

In 2007, the three registered four companies in the BVI through Portcullis TrustNet and are either together or individually named as beneficial owners of the firms. In each case, the authorised capital is $50,000. Neesha did not respond to questions sent to her.

Source: http://www.indianexpress.com/news/indian-expressicij-probe-vijay-mallya-ravikant-ruia-in-tax-havens/1097494/

LURE OF LUCRE MAY LAND YOU IN TROUBLE

April 24, 2013, 9:18 am

≫ Next: Article 3

≪ Previous: Indian Express-ICIJ probe: Vijay Mallya, Ravikant Ruia in tax havens

$

0

0

Beware of new online fraud;

police cautions public

Hyderabad: Andhra Pradesh Crime Investigation Department (CID)  on April 21 cautioned people not to fall prey to the new online fraud unleashed by Sergei Mavrodi, a Russian, who was earlier arrested in several criminal cases and underwent a term in prison.

Additional Director General of CID T Krishna Prasad said that Sergei has been promoting Mavrodi Mondial Moneybox (MMM) scheme through the website www.mmmindia.in, promising 100 per cent interest per month on the investments made by the people.

Minimum amount of deposit starts from Rs 5,000 while a member would be allowed to deposit a maximum of Rs 50,000.The Russian has been luring and duping gullible people claiming that the deposits were being collected for a social cause and to provide a platform for the like-minded people to help each other, the CID chief said.

The Russian claims on the website that Mavro is like any currency. It has two different exchange rates – one for selling and one for buying. The members could sell or buy Mavro using the special automatic software on the official website and the exchange rates would be decided by Sergei twice a week.

The website says deposits would be confirmed only after the member transfers full amount intended to deposit. The deposit would be released only after one month from the date of purchase, but it could be sold even before release at zero per cent interest rate, the website says.

The CID chief said that the scheme was already prevailing in Maharashtra, Gujarat and Punjab and was likely to enter Andhra Pradesh. Hence, he appealed to the people of the State not to fall prey to the bogus scheme.

Article 3

April 28, 2013, 7:48 am

≫ Next: GOPAL SHEKHAWAT ARRESTED IN SURAT

≪ Previous: LURE OF LUCRE MAY LAND YOU IN TROUBLE

$

0

0

'MMM India,' another, unoriginal, contagious fantasy of Sergei Mavrodi.

About 15 years ago, I coined the common-sense phrase: 'premeditated, or dissimulated, closed-market swindle,' in order to deconstruct all Ponzi schemes, pyramid frauds, money circulation games, chain-letter scams, etc. However, although a few commentators have used my term (sometimes without attribution), a 'closed-market swindle' is not yet defined in law. That said, it is universally accepted that lying to, or withholding key-information from, people in order to take their money, is fraud which is a form of theft. Common-sense also reveals that, by 'passing any law, but failing to enforce it, has the effect of authorizing the very crime which you are trying to prohibit.'  The lie which is fundamental to all 'closed-market swindles' is that people can earn income by contributing their own money to participate in any alleged 'profitable commercial opportunity' which is secretly an economically-unviable fake, due to the fact that the alleged 'profitable commercial opportunity' has been rigged so that it generates no significant, or sustainable, revenue other than that deriving from its own participants. For more than 50 years, 'Multi-Level Marketing' racketeers have been allowed to dissimulate closed-market swindles by offering endless-chains of victims various banal, but grossly-over-priced, products, and/or services, in exchange for unlawful payments, on the pretext that 'MLM' products and/or services, can then be regularly re-sold for a profit in significant quantities. However, since no gang of 'MLM' racketeers has ever proved that 'MLM' wampum has actually been regularly re-sold to the general public for profit in significant quantities,'MLM' participants have, in fact, been peddled infinite shares of their own finite money. In the final analysis, other than their ephemeral external presentations, internally there is no real difference between all closed-market swindles; for any alleged 'opportunity to make money,' wherein (when challenged, and/or rigorously investigated) the promoters are unable to provide independent quantifiable evidence to prove that their alleged 'viable commercial activity' has had any significant, and sustainable, source of revenue other than its own losing participants, is self-evidently a dissimulated closed-market swindle. David Brear (copyright 2013) ___________________________________________________________________________________________________

Sergei Panteleevich Mavrodi (Сергей Пантелеевич Мавроди b.1955) http://en.wikipedia.org/wiki/Sergei_Mavrodi

If you search for Sergei Mavrodi on Wikipedia, you will find him initially described as a Russian'businessman and financier.' However, the only truthful part of this exciting comic-book story is the fact that he was born in Russia; for, in reality, he is (without a shadow of a doubt) a megalomaniacal psychopath .

 i.e. 

Sergei Panteleevich Mavrodi is suffering from a chronic mental disorder resulting in paranoid delusions of grandeur and self-righteousness, and the compulsion to pursue grandiose objectives.

Classically, Mavrodi believes himself not only to be a historically significant businessman and a financier,but also a morally, and intellectually, perfect Russian super hero who has been chosen to free humanity from the slavery of the evil world financial system. Indeed, if you watch the above video from 2011 (in which Mavrodi quite-openly admits that he is on a mission to destroy the pyramid scheme known as the world financial system and that his chosen weapon of mass-financial-destruction, is another, even more powerful, pyramid scheme), it beggars belief that he is not already locked up in a secure hospital.

In the aftermath of the unexpected fall of the Soviet regime (which left millions of ordinary Russians, particularly pensioners, facing destitution as the buying power of the once-protected rouble collapsed, and hyper-inflation took-hold) Mavrodi (an importer of office equipment) stepped-forward in the role of economic saviour and instigated what was soon to become one of the most-extensive closed-market swindles of all time, known as 'MMM.' http://en.wikipedia.org/wiki/MMM_(Ponzi_scheme) . It has been estimated that between 1992 and 1994, 30 millions ill-informed Russians were deceived into giving a total of several billions US dollars to Mavrodi and his criminal associates, in the deluded belief that they were all going to receive a future reward of 1000%. Typically, Mavrodi began to make the truth increasingly unthinkable, by using some of his ill-gotten gains to buy media advertising (including a series of humourous television commercials) as well as obtain public association with popular Russian sports, charities, celebrities and opinion-makers. 

In 1994, Mavrodi's offices were raided and he was arrested for tax evasion, but although millions of angry victims were left out out of pocket, he avoided being held to account by getting himself elected to the Russian parliament. During his election campaign Mavrodi steadfastly pretended that the Russian government was trying to destroy 'MMM' in order to steal the company's money, and that 'MMM' investors would only be paid out if he could influence the government from inside the political system. However, no pay-out was forthcoming, and Mavrodi's immunity from prosecution was cancelled in 1995. 'MMM' was finally declared bankrupt in 1997. Mavrodi then went of the run until he was arrested in 2003. During this time, he spread a rumour that he'd gone to USA. In reality, he'd probably never actually left Russia. Indeed, it is now believed that Mavrodi had been hiding in Moscow, protected by a well-rewarded gang of former Soviet intelligence agents/thugs/racketeers who had access to a labyrinth of safe-apartments.

With the help of a relative, Mavrodi instigated another closed-market swindle in 1998, this time known as 'Stock Generation.' His new scam was nothing less than an Internet-based counterfeit stock market. http://en.wikipedia.org/wiki/Stock_Generation, but it was dissimulated as a 'lawful gambling game' and was targeted at greedy Americans and W. Europeans. Largely because of its deliberately-incomprehensible linguistic, and mathematical, presentation, the essentially-simple closed-market swindle known as 'Stock Generation,' initially duped a United States District Court in Massachusetts, but it was closed-down by the United States Court of Appeals, when common-sense was finally applied in 2000. Few of Mavrodi's estimated 20 000 and 275 000 victims, complained even though they lost a estimated total of at least US$5.5 millions.

Following his arrest in Russia in 2003, Mavrodi was initially sentenced to 13 months prison for holding a false passport.  He was subsequently convicted of fraud and tax evasion, and was released from a penal colony in 2007.






Since 2011, Mavrodi has been running a closed-market swindle known as 'MMM 2011' or 'MMM India,' in which countless victims have been deceived into buying effectively-valueless pieces of paper printed to resemble an authentic, valuable currency, the so-called 'Mavro.' 



There are even 'Mavro' coins.

Amazingly, Mavrodi openly-admits that 'MMM 2011/ India' is a pyramid scam. He is widely-quoted as saying : 'It is a naked scheme, nothing more ... People interact with each other and give each other money. For no reason!' However, since Mavrodi's 'MMM' organization has exhibited the universal identifying characteristics of a cult, his activities are neither original nor unique and, consequently, they cannot be fully-understood in isolation.

http://en.wikipedia.org/wiki/Eric_Voegelin

Erich Hermann Wilhelm Voegelin (1901-1985), was a gifted German academic, who, in the decade preceding WW II (working largely-alone), produced an insightful explanation of ‘Nazism’ as a form of perverted religion or cult. Sadly, during the 1930s, few people took much notice of Eric Voegelin. 

Whilst teaching political theory and sociology at the University of Vienna, he published two books, ‘The Race Idea in Intellectual History’ and ‘Race and the State’. In these, he pointed out the elementary, mistakes which invalidated various, popular ‘racial theories’. In 1938, Voegelin (aged 37) tried to publish 'The Political Religions'. In this, he focused on contemporary totalitarian ideologies derived from the ‘racial theories’ which he’d previously criticised as absurd pseudo-science. He now pointed out the glaring structural similarities of these ideologies to religions. Courageously, Voegelin was comparing medieval pseudo-sciences and 'Gnostic' cults to the 'Völkish’ or ‘Pan-German’ movement and its terrifying post-WW I incarnation, the 'Nazi party'.

In 1938, the ‘Nazi’ leader, Adolf Hitler, had held absolute power in Germany for almost 5 years. He had just taken control of Austria. The self-gratifying ‘Aryan Master Race’ delusion was spreading like a virus. In essence, Hitler controlled his fanatical core-adherents with a  comic-book story in which he was a morally and intellectually perfect Aryan super hero, the 'führer,' on a mission to save his 'noble race' from the slavery of the world financial and political system which was controlled by an 'evil secret society of sub-human Jews, Freemasons,' etc.

The dozens of books, essays and reviews which Eric Voegelin published during his lifetime, are almost impossible for the average person to take in.

Eric Voegelin

To give readers some idea of the scale of his thinking, Voegelin’s Major work, ‘Order and History’, began to be published in the USA in 1956 when he was aged 54, but it remained unfinished when he died 31 years later. In simple terms, Voegelin was as a philosopher-historian who took an elevated, and broad, view. He observed that, throughout human history, there have been periods of mass-alienation... following wars, revolutions, plagues, natural disasters, economic depressions, etc. ... during these periods, dangerous manipulators (acting like ancient, Gnostic Prophets by pretending moral and intellectual authority and offering some form of Utopian existence in the here and now) who at other times might be dismissed as absurd crackpots and charlatans, have found it much easier to become accepted as authentic Messiahs and to acquire a mass-following.

Thus, Voegelin, not only described, but also predicted the arrival of the latest generation of economic alchemists, like Sergei Panteleevich Mavrodi.


David Brear (copyright 2013)


http://www.business-standard.com/article/beyond-business/russian-riddle-113041200530_1.html

http://www.moneylife.in/article/mmm-india-another-mlm-taking-people-for-double-your-money-ride/32367.html

http://www.firstpost.com/investing/grow-rs-5000-to-rs-3-4-cr-in-a-yr-is-mmm-the-biggest-ponzi-scheme-ever-700184.html

http://www.business-standard.com/article/economy-policy/russian-financial-scheme-for-rural-india-113040600017_1.html

http://www.business-standard.com/article/markets/the-only-rule-in-a-russian-roulette-113040800507_1.html

http://qz.com/71919/forget-bitcoin-this-virtual-currency-doubles-your-money-every-month/

http://www.business-standard.com/article/economy-policy/ap-police-caution-people-against-mavrodi-scheme-113042400727_1.html

http://www.business-standard.com/article/finance/investors-blink-as-mavrodi-slashes-rates-of-mavro-113042600234_1.html

GOPAL SHEKHAWAT ARRESTED IN SURAT

April 30, 2013, 7:35 am

≫ Next: NMART ACCUSED BROUGHT TO ONGOLE

≪ Previous: Article 3

$

0

0

Finally, the accused in the multi-crore NMart fraud, Gopal Shekhawat, was arrested by the Andhra Pradesh police in Surat on Tuesday.
The Prakasam district police headed by Dr N Raghuram Reddy, superintendent of police, finally made a headway in the investigation of the case and arrested the accused who had been evading the arrest for the last several months.
Additional Commissioner of Police (Crime) Narasimha Kumar and Deputy Inspector General of Police (SIB) VC Sajjanar contributed their efforts for the arrest of the accused
It may be recalled that Corporate Frauds Watch lodged a complaint with the Prakasam district police against the illegal money circulation scheme indulged in by NMart duping several millions of people up to several crores of rupees.
The police swung into action and arrested Gopal Shekhawat in Surat last year but he obtained bail from a Mumbai court on the promise that he would present himself in the Ongole court by September 3rd. However, he jumped the bail and since then he had been absconding.
The police also issued a lookout notice for the absconding proclaimed offender.
On April 30, the Prakasam district police arrested Gopal Shekahwat and produced him in a local court for obtaining the transit warrant to shift the accused to Ongole.
The local court has issued the transit warrant also known as PT warrant to transport him to Andhra Pradesh.
Gopal Shekhawat would be produced in the Principal Sessions Court at Ongole as soon as he is brought to Ongole. 

---

NMART ACCUSED BROUGHT TO ONGOLE

May 2, 2013, 8:34 am

≫ Next: Police seek custody of Gopal Shekhawat

≪ Previous: GOPAL SHEKHAWAT ARRESTED IN SURAT

$

0

0

·        Rs. 662 crore scam unearthed by Prakasam SP

Superintendent of Police Dr Kolli Raghuram Reddy here on Thursday presented Gopal Mohan Singh Shekhawat, accused in the multi-crore scam before the media.

Addressing the media, the SP said that the accused indulged in illegal money circulation scheme and collected deposits violating the provisions of AP Protection of Depositors of Financial Establishments Act, 1999.

Elaborating on the modus operandi of the accused, the SP said that Gopal Shekhawat through his company New Look Retails Pvt Ltd, collected Rs. 662 crore from 12,02,762 depositors at the rate of Rs. 5500 from each person violating the provisions of the RBI Act, 1934.

The accused gave 48 vouchers each worth Rs. 220 to encashed in the next 48 months. He also offered attractive incentives and gifts to the members.

Following a complaint lodged by a civil society organization Corporate Frauds Watch, the Kandukuru police registered a criminal case and started investigation.

The SP said that though the Kandukuru police arrested Gopal Shekhawat on August 28, 2012, the accused managed to get bail in Mumbai on the promise that he would present himself in the Ongole court on September 1, 2012. However, he jumped the bail and since then he was absconding.

In the meanwhile, the accused secured anticipatory bail from Ongole court in November, 2012, but the Andhra Pradesh High Court cancelled the anticipatory bail paving way for the arrest of the accused, he said.

The Kandukuru and Chirala police earlier arrested the other directors of the company and were sent to judicial custody.

The relentless pursuit of the accused resulted in his arrest, he said and announced rewards to Kandukuru DSP Ashok Kumar, CIs Rayapati Srinivas Rao and Venkateswara Rao and SI Bhaktavatsala Reddy.

The police seized Rs. 50 crore worth property of the accused along with two cars – Rolls Royce and Mercedes Benz – and a helicopter all worth Rs. 10 crore. The police requested the Bank authorities concerned to freeze the accounts of the accused in which there is Rs. 2.19 crore.

The SP said that the accused is also facing several criminal cases filed against him in Guntur, Chilakaluripet, Chirala, Vijayawada, Visakhapatnam and Medak in the State and Kozhikode in Kerala.

Police seek custody of Gopal Shekhawat

May 5, 2013, 10:20 am

≫ Next: Sachin Pilot's MLM companies list does not include Amway India

≪ Previous: NMART ACCUSED BROUGHT TO ONGOLE

$

0

0

The police of various districts where criminal cases were filed against Gopal Mohan Singh Shekhawat, the kingpin in the multi-crore scam of NMart aka New Look Retails Ltd, are seeking his custody for his interrogation. They, it seems, wanted to know as to how much money he has illegally collected from public and where did he stash the cash apart from spending on luxurious cars and a helicopter. 
Already Prakasam district police filed a petition for his custody. They may question the accused for at least three days if not a week. The Visakhapatnam police have also filed a petition for the custody of multi-crore scamster to grill him about the details of the scam.
Guntur DSP (Crime) Ravindra Babu said that they are going to file the custody petition to interrogate the accused. 
Chilakaluripet police are also ready for filing a petition seeking the custody of the accused.
However, one has to wait and watch how many more police would seek custody of the NMart chief, prime accused in the multi-crore scam.
There is already a criminal case in Kerala and the Kerala police may also want to question the accused.
Three criminal cases were filed in Aurangabad, Maharashtra, and they may also ask for custody of Gopal Shekhawat. 
Meanwhile, the CID is also preparing the list of criminal cases against the accused.
It is worth to note here, that the counsels of NMart kingpin filed a writ petition in the AP High Court soon after Prakasam district police filed the FIR against the company seeking the transfer of the case to the CID of AP. 
The motive behind the petition is well known. However, before the AP High Court heard the petition, the counsel of NMart had withdrawn the petition with the plea to submit once again. However, the NMart counsel never submitted the writ petition again in the high court.

Sachin Pilot's MLM companies list does not include Amway India

May 7, 2013, 5:48 am

≫ Next: Thieves want legitimization of their racketeering

≪ Previous: Police seek custody of Gopal Shekhawat

$

0

0

Union Minister of State for Corporate Affairs Sachin Pilot submitted the list of MLM firms illegally operating in the country. However, he did not mention the name of M/s Amway India Enterprises though the Andhra Pradesh High Court squarely held that the business model of Amway India is nothing but a money circulation scheme under provisions of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978. 

4/24/13 www.thehindubusinessline.com/industry-and-economy/pilot-submits-list-of-illegal-mlm-schemes/article4647537.ece?css=print 1/4
Sachin Pilot submits list of illegal MLM schemes
Our Bureau
April 23, 2013: The Union Minister of State for Corporate affairs on March 14, 2013 presented to Lok Sabha a state-wise list of companies against which complaints were received for indulging in Ponzi/ MLM (multi-level marketing) schemes. Pilot was responding to queries raised by D B Chandre Gowda and Adhi Sankar.

WEST BENGAL
(1) M/s. Vibgyour Allied Infrastructure Ltd.
(2) M/s. Rose Valley Real Estates Constructions Ltd.
(3) M/s. Rose Valley Industries Ltd.
(4) M/s. Silver Valley Communications Ltd.
(5) M/s. Rose Valley Food Beverage Ltd.
(6) M/s. Rose Valley Marketing India Ltd.
(7) M/s. Rose Valley Infotech Pvt. Ltd.
(8) M/s. Rose Valley Hotels and Entertainments Ltd.
(9) M/s. Rose Valley Projects Ltd.
(10) M/s. Rose Valley Patrika Ltd.
(11) M/s. Rose Valley Films Ltd.
(12) M/s. Modern Investment Traders Pvt. Ltd.
(13) M/s. Rose Valley Travels Pvt. Ltd.
(14) M/s. Brand Value Communications Ltd.
(15) M/s. Rose Valley Housing Development Finance Corporation Ltd.
(16) M/s. Rose Valley Airlines Ltd.
(17) M/s. Rose Valley Fashions Ltd.
(18) M/s. Rupasi Bangla Projects India Ltd.
(19) M/s. Rupasi Bangla media and Entertainments Ltd.
(20) M/s. Rose Valley Realcom Ltd.
(21) M/s. Saradha Realty India Ltd.
(22) M/s. RTC Properties India Ltd.
(23) M/s. RTC Real Trade India Ltd.
(24) M/s. Jasoda Real Estate Ltd.
(25) M/s. Saradha Printing & Publication Pvt. Ltd.
(26) M/s. Saradha Agro Development Ltd.
(27) M/s. Saradha Biogas Production Pvt. Ltd.
(28) M/s. Saradha Tour and Travels Pvt. Ltd.
(29) M/s. Saradha Automobiles India Ltd.
(30) M/s. Saradha Constructions Company Pvt. Ltd.
(31) M/s. Saradha Shopping Mall Pvt. Ltd.
(32) M/s. Saradha Education Enterprise Ltd.
(33) M/s. Saradha Exports Ltd.
(34) M/s. Goldmine Agro Ltd.
(35) M/s. Tower Infotech Pvt. Ltd.
(36) M/s. Chakra Infrastructure Ltd.
(37) M/s. Gold Field Agro Ltd.
(38) M/s. Golden Life Agro India Ltd.
(39) M/s. Golden Pariwar Holding and Developers India Ltd.
(40) M/s. Goldmine Food Products Ltd.
(41) M/s. Hallo India Express Sales Ltd.
(42) M/s. Happy Life Realty (India) Ltd.
(43) M/s. ICore E-Service Ltd.
(44) M/s. MPS Aqua Marine Products Ltd.
(45) M/s. MPS Greenery Developers Ltd.
(46) M/s. MPS Industries & Agro Research Ltd.
(47) M/s. MPS Resorts and Hotels Ltd.
(48) M/s. Prayag Agrotech Pvt. Ltd.
(49) M/s. Prayag Infotech Hi-Rise Ltd.
(50) M/s. Prayag Infra Realtors Ltd.
(51) M/s. Prayag Micro Finance
(52) M/s. Rahul Heights Ltd.
(53) M/s. Rahul Hi-Rise Ltd.
(54) M/s. Ramel Industries Ltd.
(55) M/s. Shine India Agro Industries Ltd.
(56) M/s. Silicon Projects India Ltd.
(57) M/s. Sunshine Agro-Infra Ltd.
(58) M/s. Sunshine India Land Developers Ltd.
(59) M/s. URO Agro India Ltd.
(60) M/s. URO Autotech Ltd.
(61) M/s. URO Hotels and Resorts India Ltd.
(62) M/s. URO Hygenic Goods Ltd.
(63) M/s. URO Infotech Ltd.
(64) M/s. URO Infra Realty India Ltd.
(65) M/s. URO Life Care Ltd.
(66) M/s. URO Trexim Ltd.
(67) M/s. URO Walkers Ltd.
(68) M/s. Vasundhara Realcon Ltd.
(69) M/s. Vibgyor Allied Industries Ltd.
(70) M/s. Vishwamitra India Consultancy Services Ltd.
(71) M/s. Vishwamitra India Multi-Developers Ltd.
(72) M/s. Waris Hospital & Diagnostic Centre Ltd. (Now Waris Healthcare Ltd.)
(73) M/s. Waris Telecom Services Ltd. (Waris Tel International Ltd.)

RAJASTHAN
(1) M/s. PACL (India) Ltd.
(2) M/s. Goldsukh Trade India Ltd.

TAMIL NADU
(1) M/s Unipay 2U Marketing Pvt. Ltd.
(2) M/s Unipay Creative Business Pvt. Ltd.
(3) M/s Unipay 2U Production Pvt. Ltd.
(4) M/s. Goldquest International Pvt. Ltd.
(5) M/s. Questnet Enterprises India Pvt. Ltd.

KARNATAKA
(1) M/s Unigateway 2U Trading Pvt. Ltd.

DELHI
(1) M/s Speakasia Online Pte. (Unregistered)
(2) M/s. Basil International Ltd.
(3) M/s. Vamshi Chemicals Ltd.
(4) M/s. Appeline Cosmetics & Toiletries Ltd.
(5) M/s. Basil Express Ltd.
UTTAR PRADESH
(1) M/s. Nixcil Pharmaceuticals Specialties Ltd.

COURTESY BUSINESSLINE

Thieves want legitimization of their racketeering

May 7, 2013, 6:16 am

≫ Next: Full text of Police interrogation....Gopal Shekawat

≪ Previous: Sachin Pilot's MLM companies list does not include Amway India

$

0

0

THIS IS THE LETTER ADDRESSED TO THE RACKETEERS ALL OVER COUNTRY TO ASSEMBLE AND BRING PRESSURE ON THE GOVERNMENT FOR LEGITIMIZATION OF THE RACKETEERING. THESE RACKETEERS HAVE BEEN BRAZENLY ASKING THE GOVERNMENT TO SHIELD THEM.
NEXT TIME, THE BURGLARS ALSO FORM AN ASSOCIATION AND DEMAND THAT THE POLICE SHOULD NOT CATCH THEM AFTER THEY BURGLED THE HOUSES.
THIS IS THE STATE OF AFFAIRS IN INDIA.

	Dear Sir(s), As you are aware that Direct Selling Distributors Welfare Association (DSDWA) was launched as FDSA affiliate to strengthen our struggle and to provide a shield to all Direct Selling Distributors (DSDs). Enrollment of DSDs in DSDWA is another major task of DSDWA for strength demonstration. We are pleased to announce that DSDWA has started the job and data has started pouring in. All information is available on www.dsdwa.org Recently we are finding lot of turbulence in Bengal which is likely to hit us very badly, if we do not act swiftly. The government is not able to segregate the genuine direct sale from such schemes. As we have seen many a times (sic), the government looks at us in the outfit of schemes. On 24th April 2013 Mr. Sachin Pilot submitted a list of illegal MLM schemes. Please go through the link http://fdsaindia.org/pdf/Pilot-submits-list-of-illegal-MLM-schemes-BusinessLine.pdfonly to find that none of these companies are MLM or Direct Selling Companies but are being referred to as MLM. We are in danger zone today. We would appreciate if you and your key leaders visit the link http://fdsaindia.org/media.aspx and become aware of the alarming situation. We have been raising our voice at many a forums.(sic) Finding meek response from the authorities and discriminative (sic) attitude towards Indian companies we are left with no option but to demonstrate our strength. DSDWA has declared a gathering of DSDs at Jantar Mantar on May 7, 2013 as announced in www.dsdwa.org This is a take off stage of our mission and has to see foolproof success for Industry’s survival. Your physical presence is mandatory to participate our first & historical public gathering, and be responsible to propagate about this gathering and bring as many as possible to make this event a big successful. I personally appeal for your support in this mass gathering. Please make sure to be present on 7 th May 2013 – Tuesday 10 AM to 5 PM. Surendra Vats President

Full text of Police interrogation....Gopal Shekawat

May 17, 2013, 2:50 am

≫ Next: Abhaya Gold bubble burst, BUT

≪ Previous: Thieves want legitimization of their racketeering

$

0

0

Full text of police interrogation of Gopal Mohan Singh Shekawat released by the police:

INTERROGATION REPORT OF GOPAL MOHAN SINGH SHEKAWAT S/O MOHANSINGH SHEKHAWAT, 47 YEARS, RAJPUT BY CASTE, SURAT, GUJARAT STATE (A-2) (C.M.D OF NMART RETAILS PRIVATE LIMITED)  IN CR.NO. 154/2012 U/S 406,420 IPC AND SEC. 4,5 & 6  R/W 3 OF THE PRIZE   CHIT  AND MONEY CIRCULATION  SCHEMES (BANNING) ACT SEC.5 OF THE A.P. PROTECTION OF DEPOSITORS  OF FINANCIAL ESTABLISHMENTS ACT, 1999 OF KANDUKUR TOWN POLICE STATION.

1^ST DAY

Date : 12-05-2013 at 10 A.M                                    Place : Sub-Divnl. Police Office,

                                                                                     Kandukur.

               I am the native of Sikar Rajastan, Purohitjeekidhani, Radhakishanpura, Sikar District, Rajastan  State.  I have completed  SSC in Rajastan State.  In the year 1986 I have reached Bombay, Boriville and started working along with my friend Arjuna Kumar Varma who is a building contractor started work up to 1988. My friend had given an opportunity to develop contract works and I have taken my routine expenses from him only.   While I was in Mumbai, I have completed graduation B.com through correspondence course.  In the year 1988, I had transferred to Bahindar and started labour contracts by residing in Bahindar East until that labour contract was completed upto 1992. I have lost my father in the year 1990.  I got love marriage with one Prathibha Shekawat in the year 1991.  In the year 1992 I have started my business i.e., export of garments  and importing like coils and iron steel as indenting agent from the different companies. In the year 1995 I will start import of computer parts and I have used to purchase the computer  parts from Hongkong and used to sold in India.  In the year 1997 electronic goods markets is going to down, subsequently  import business is going to stop and I have changed my business to  iron and steel trading like beam, channels and  bars took from the company and sold to the builders and local traders ON  commission basis.  In the year 1999 myself started business at Dubai intending to purchase and sale some items from Dubai and other countries for trading based business and  went to Dubai along with my family i.e., wife for trading business.  In the year 2001, I returned to India and started Garment business. But I have not succeeded in the business. In the year 2002 I have changed my family to Surat and started to  work in Gujarat by taking sick industry, demolishing the industries and sell the  same up to 2005.  After 2005 that scrap business market is going  down, nobody  purchased the scraps.  In the year 2006-2007, I have started business i.e., purchase and sale of building to the corporate companies so that I can earn good money.  This is not continuous business and I have faced so many problems in that business. Then we have decided to establish continuity of the business and decided to get the knowledge in retail business and started to gain some knowledge. I have started a retail shopping mall business in the year 2008 and bought one company by name New Look multi Trade Private Limited, Surat.  Before that Reena Dargar and Vijaya Dargar are directors of the company and promoters also.  Then we have took company from them of my two friends i.e., one Chandra Prakash Lakshak and one Mr. Dharmendra Ram Swaroop Anand.  The company was registered in Mumbai in the year 2008 and I have changed share holding of the company and changed the  directors also.  I have entered into company on 2009 by holding authorized capital of Rs. 01,00,000/-. In the year, 2010     I have got Chandra Prakash retired from the company and appointed Deepak Shekawat (my brother) in my company and after some time Deepak Shekawat was retired and put Mohammed Salim Khan as one of the Director by holding some shares and now he is now continuing in the company. New look multi Trade Company name was changed  to New look retails Private limited in the year 2010 and Nmart is brand name is a division of New look multi trade Private limited. The New look multi trade company initially established in Mumbai and registered in the Registrar Companies, Mumbai. On 03-06-2009 1^st  shopping mall was started like a super market at Surat.  Nmart scheme was started on 26-01-2010 by consulting  Bharat Handifrod who is having knowledge of making soft ware and they will came into contact with Samirdesh PandeHa,  I have introduced the scheme with the help of two persons.  In that scheme I have introduced a incentive that  if a person wants to join in the scheme he would have to  pay Rs. 5,500/- and gets broucher, Bond, 48 purchase coupons and two Registration forms will be sent to the member to enroll as a  member of Nmart retails Pvt. Limited.  In that scheme I have also introduced incentives  and Rewards to attract the customers more to  develop  the business.  There are as many as 16,50,000/- customers were joined as members  in my company after opening  of company till today and we have 287 mall shops and out them 146 are running in throughout India and the remaining are under construction and total Rs. 907 Crores of Rupees was collected from the customers.  I have given about 370 crores  of  rupees    as commission to our members and dependent business associates, around 170 crores was given  for rewards and around 300 crores of rupees purchase material was given through coupons, around 47 crores of rupees was sanctioned to the customers to attend credit facility.  Around 2 lakh members were joined in the company throughout Andhra Pradesh and collected 110 crores of advances from the customers.  About 60 crores of rupees was paid to the members as commission amount, Purchase brouchers, rewards.  New look airways was established in the year 2011 and one Mandar Barde and Hiren Diwani are the directors of the company, they have took Rs. 01,72,40,000/- loan from Nmart company to purchase helicopter on 17-08-2011 and the money was transferred from Axis Bank, Surat to New Look Airways Private limited, Mumbai.   I have also established a company by name and style of Nmart infrastructure, Surat in a building which is situated at Honeypark road, Dazzle Arcade, Surat and the company is  looking after the sale, purchase of lands and buildings. I am also the director of the Nmart infrastructure, Surat  company and Prathibha shekavath also one of the director of this company and after some time she had retired and now Salim Khan is looking after entire business and finance as per my directions. 

2^ND DAY

Date : 13-05-2013 at 10 A.M            

                                                                                         

                         Today I continued further examination on Gopal Mohan Singh Shekhawat in presence of above Mediators Mediators:-            Then I have given the following questionnaire to Shekhawat.

1)      Have you enrolled members from the area where there are no malls?

Ans : Yes, after enrolling 500 to 1000, we planned to establish malls.

2)      But if the voucher is generated, it is to be renewed within 30 days.  How can we except a member living at distant area all over come to mall and purchase. It was not mentioned in agreement that he can used after wards.

Ans : He can utilize the same balance voucher after establishment of mall.

3)      It was not mentioned in the agreement that he can use after wards.

Ans : I think it is also there in Agreement.

4)      After enrolling members after receipt of Rs. 5,500/- you are going to provide suit lengths worth Rs. 3,000/- to the members.

Ans : Yes.

5)      What if member is a woman?

Ans If they accept, we are giving suit length we are planning saris also.

6)      What is the purchasing cost of suit length?

Ans : We purchase from company and the cost of suit length is Rs. 1675/- and the other Rs. 300/- is for postal charges and Rs. 100/- for packing and handling charges and the remaining amount is with company.

7)      Who is the Franchiser of Nmart retails at Kandukur, Guntur and Vijayawada?

Ans : Mutcheli Umamaheswarao is the Franchiser of Kandukur Nmart retails shop. He had paid Rs. 5,00,000/-  to my company and opened a shopping mall in Kandukur. At Vijayawada no Franchiser to Nmart retails shop and Manager State operating head by name Shaffi has been operating the retails shop. At Guntur there is no Franchiser and Manager has been operation and I don’t know the name of the Manager.   

8)       What is the benefit the franchiser will get after joining as Franchiser of the company?

Ans :The franchiser will get 18% interest  till Franchisee is with him and 2% incentives basing on the turn over and his responsibility to maintain the administration of Nmart retail shops.

9)      What is number of customers in Kandukur Area and How much money was collected from the customers in Kandukur area?

Ans : There approximate 10,000 members were enrolled as members in Kandukur area and about Rs. 01,10,00,000/- was collected as Advance from the customers. We have giving 42 to 50% commissions.

10)  As per the auditor’s report the profit for the year 2010-2011 is                        Rs. 68,03,577-00 and during the year 2011-2012 the company get profit for Rs. 5.73 crores? Is it true or not?

Ans: Yes.

11)  In the auditor’s report, it was shown the amount sales through promotional scheme and other sales. What is meaning of the sales?

Ans : It is suit length and credit for Rs. 1500/- as per my knowledge.

12)  What is the total enrollment of members in your company through India?

Ans. 16,50,000 members and collected Rs. 907.50 lakhs Crores.

13)  During which period the deposits were collected?

Ans : 31 months from January, 2010 (upto August 2013).

14)  What the workable calculation is of provisions that to be supplied to the malls?

Ans: We purchase in wholesale price in average margine of 30-35% between sale and purchase.  If a person purchases Rs.1000/- from my shop and the original purchase cost is Rs.700+gift voucher Rs.220/-.  Rs. 80/- profit from the members only and the same price of cost will be sold to the other customers.

15)  What is the total enrollment of members in Andhra Pradesh?

Ans: 2,00,000 members are joined in the company and collected 110 crores of Rupees.

16)  How many shops were opened in Andhra Pradesh?

Ans : 14 shops are running ie., Vijayawada, Visakhapatnam, Kakinada, Thirupathi, Kandukur, Guntur, Hyderabad, Miriyalaguda, Medak and others  and 16 are under constructions.

17)   You think that the scheme will be maintainable in future, is there any difficulties faced by you. Before launching the scheme, you have to get permission from RBI according to the RBI rules?

Ans : It is not a deposit, recurring deposit, it is that membership enrolled scheme develop my retailed mall chain. As per my knowledge, there is no need to register in RBI.

18)  Your scheme is chain link system, you have proposed it as Multi Level marketing, and as per the provision of law this may comes under Prize chit fund money circulation act (Banning 1978)?

Ans : In the year 2003 one notification passed by the Govt. of India, consumer affairs that order copy is available with me. Those company selling in retails goods, materials by way of direct marketing, multilevel marketing.  Multi level and direct marketing in MLM (Multi level marketing) that company it will comes into Prize company chit fund act.

19)  Where did you have conducted meetings in Andhra Pradesh?

Ans : Myself I have conducted meetings in Hyderabad, Vijayawada, Thirupathi, Guntur, Kadapa, Kakinada, Visakhapatnam etc.

20)  Where did  the agents will collect the rewards and where they are purchasing?

Ans : Only in Big malls i.e., Vijayawada, Thirupathi, Hyderabad, Visakhapatnam etc.

21)  In the auditor’s report it was  shown that during the financial year 2010-2011 and 2011-12 Franchiser deposit as Rs. 06,25,84,378/- and                    Rs. 21,09,12,614-00 total Rs. 27,34,96,992/- respectively? This amount will add in the customers deposit. How my shops are functioning in India?

Ans : No, this amount was not added to customers deposit. Now the company has closed all the shops expect six at Surat, Meeraz of Maharastra, Chikodi of Karnata and Bhopal of Madhyapradesh and Howra of Kalacutta.

22)  How you have taken the company from Reena Dargar and how much amount paid to him?

Ans : When a New company would have been started, it may take 6 or 7 months time and I have paid Rs. 50,000/- to Reena Dargar.

23)   You have purchased helicopter from the profit of the company and from where it was purchased and the age of the helicopter?

24)  Ans : Yes I have purchased the helicopter from the profits in the year 2011 from one Genak owner of Chpper Robinson-III Helicopter.

25)  According to the auditor’s report in the year 2011 you have given advance amount for property W/Rs. 01,37,18,826/- to six properties? Did you purchase all these properties or not?

Ans : Yes, Out of 6 properties

(1)   I have given advance for shop in Surat i.e., from Ghambhir and paid Rs. 2,77,826/- as an advance but the Bank loan amount with the Goutham Gambhir in that property. Still is pending.

(2)   I have given Rs. 56,70,000/- for Kandavilli Flat No. 2405 (House for my residence) at Mumbai from Builder, Butwill of Mumbai and it was completed and it was registered in my name and my wife’s name.

(3)   I have given Rs. 25,88,000/- (Behind of Sona Hotel, Surat ) to buy simple apartment for my staff members  and it was registered in the name of either Salim Khan or in the name of the company.

(4)   I have purchased one Flat from Jayshreeben Mehta at Surat and paid an advance for Rs. 06,85,000/-  and it was sold it to another party for          1 lakh profit.

All the properties are purchased from the customers who enrolled in the company.

All the properties are in the name Nmart retails except Item No. 1 is in the name of myself through cheques. 

26)  According to the auditor’s report in the year 2012 you have given advance amount for property W/Rs. 08,80,10,480/- to Eleven properties? Did you purchase all these properties or not?

Ans : Yes, Out of 11 properties

(1)   Advance Ware House at Kuvarda nearby Ankleswar, Surat  from the farmers i.e., Chaghan Bhaipatel, Kuvarda : I have given Rs. 02,30,62,00/- as an advance, Part payment is yet to be given to the owner of the land.

(2)   East Africa Automotive Pvt., Near ONGC Colony, Surat Survey No. 15  belongs to Surekha Dilip Natwani : I have given Rs. 03,00,00,000/-as an advance. Only purchase contract was done, but the party is having dispute in the  court.  Hence, it is pending.

(3)   I have purchased one Plat from Prasanth Babu, Surat (open land) to an extent of approximately 500 – 1000 yards to a tune of Rs. 89,03,480/- as an advance.  The deal was cancelled since they have not given clear clarification.

(4)   I have purchased one Disha Mall, Aurangabad from one Dilip Parekh who is owner of the property) and paid Advance Rs. 25,00,000/- (Disha is the area and mall is meant by Nmart shop) and the mall cost is Rs. 01,00,00,000/- as an advance and it is under process.

(5)   I have purchased Rainbow Flying Club Pvt. Limited, Surat belongs to Captain Nayum and Bharatsing who are owners of the Rainbow flying club and  paid Rs. 10,00,000/- as an advance which is situated near Airport. The deal was cancelled.

(6)   I have purchased a Ready shop for establishing a Restaurant by name Swastic House (Ground floor and basement)  and Purchased the same  to a tune of Rs. 06,00,00,000/- and got registered the same from Mr. Anil Patel and Bharat Singh  to an extent of 12000 sq. feet

(7)   I have given Rs. 8,00,000/- to Unit Publication advertising agency. I am not remember that one.

(8)   I have given Rs. 51,52,000/- as advance to one Surya complex flat but the deal was cancelled as the plot is sold away to another party and thus I have reback my amount from the  concerned.

(9)   I have given advance Rs. 56,70,000/- to purchase a small Office located in Andheri Mumbai that payment was done from IC IC Bank, Surat and the building is under construction.

                                                                                                                       All the properties are in the name Nmart retails except Item No. 1 is in the name of myself through cheques. 

27)  Who is Pratibha Ben Shekhavat?

Ans: My wife.

28)  Your wife had taken loan for Rs. 3,46,71,452/- as loan amount? For what purpose?

Ans : To purchase properties in Surat and somewhere?

29)  Yourwife had also taken Rs. 18,96,578/- for what purpose?

Ans : I don’t know.

30)  You have launched a loyalty bonus of above minimum Rs. 11,000/- after completion of 48 months or above? Is it possible to repay the amount to all customers after completion of 48 months?

Ans : Yes, it is possible.  I have make one agreement between customer and company with conditions that every customer has purchase of Rs. 72,000/-.  Then they are liable to take the Loyalty bonus.

31)  How it is possible?

Ans : Because if I have sold my goods for Rs. 72,000/- to any customer then my profit is about 35%.

32)  What are the value of properties you are owning?

Ans : About 80 to 90 crores.

33)  Is the fast growth company was possible due to obtain deposits from customers and investing the same in the business?

Ans :Yes.

34)  From Kandukur who are beneficiaries of your scheme and also who took active part in joining New customers?

Ans : 1) Kareti Venkateswarlu 2) Challa Srinivas  3) M. Umamaheswarao.

3^RD DAY

Date : 14-05-2013     

            My advocate at Bombay is Ashok Sarovgi.  After getting transit bail there, the advocate misled me.  He asked me not go to court to appear.  But he could not get any bail from court.  After wards I stayed along with my family at Bombay in my flat – 2405, Vishnu Shivam apartment, Tagoore Village, Kandivalli East , Bombay for about 1 ½ month.  I went to Rajasthan and stayed in Jaipur in my friend Sunil Bhatwara’s farm house.  It is situated at Trunk road.  My friend is a diamond merchant.  During my stay at Jaipur my wife, children, mother, younger brother were with me.  I stayed there for 2 to 3 months and after wards came back to Surat for getting treatment to my wife.  

                        In some cases I could get bail, but in all the cases of Prakasam district all bails were cancelled.  I fed up with my Bombay advocate.   To give moral support to my wife I decided to stay back at Surat.  I also asked my staff to continue malls without scheme because scheme is not permitted by law as it is nothing but money circulation. 

                        The editor Manoj Mistry of Gujarat Guardian , news daily is my friend.  I also gave ads to that paper.  About 20 lakhs amount was paid to that paper.  At the time of cricket matches for advertisement, I arranged 2 to 3 ad boards twice in ground.  For that he paid 2 to 3 lakhs for each board to Rajesh Bai Desai of Simphony ad agency, Surat. 

                        N Mart marketing and enrolment business started in 2010 January.  Before 2010 the total worth of my property was about 25 cores.  Now it would be about 80 to 90 cores.  All this I got through N Mart Business.

Abhaya Gold bubble burst, BUT

May 22, 2013, 10:04 pm

≫ Next: Amway India Chairman, 2 Directors arrested

≪ Previous: Full text of Police interrogation....Gopal Shekawat

$

0

0

Finally, the Abhaya Gold bubble burst. Police arrested the managing director of Abhaya Gold Koganti Srinivasa Rao who has been evading the arrest for quite sometime. It is yet to be ascertained how much money he has actually collected and how much money he has paid to the brokers aka agents.
These brokers are the real culprits who induce their friends and relatives to put their hard-earned money into these fraudulent blade companies.
Since Peerless, Sahara, Golden Forest and today's Akshaya Gold, Abhaya Gold, AgriGold, these companies have been duping millions in spite of the warnings by the right-thinking people not to fall prey to such fraudulent schemes.
Corporate Frauds Watch has been warning people for the last six years not to lose their money in these schemes.
Some of these companies collect monies in the name of real estate while some companies defraud people in the name of products and services.
Whatever be the scheme, people are the losers.
Unfortunately, they never learn from the past mistakes. Moreover, these fraudulent elements preach them the 'truth' to look for money where you lost. That is why these people keep on looking for money in some other scheme all the time.
THERE IS NOTHING LIKE EASY AND QUICK MONEY. IF YOU WORK HARD AND SAVE MONEY. THEN ONLY YOU WOULD BE HAPPY IN YOUR LIFE.

Amway India Chairman, 2 Directors arrested

May 28, 2013, 12:41 am

≫ Next: Why Amway is not taking legal recourse to resist criminal case?

≪ Previous: Abhaya Gold bubble burst, BUT

$

0

0

Kozhikode (Kerala): Network marketing firm Amway India Enterprises Chairman and CEO William S Pinckney and two company Directors were arrested here on Monday on charges of indulging illegal money circulation scheme under the provisions of Prize Chits and Money Circulation Schemes (Banning) Act.
The two directors are Sanjay Malhotra and Anshu Budhraja, crime branch sources said.
The arrests were made on a complaint of a woman who claimed to have incurred loss through the network and on the basis of three cases registered against the company last year in Wayanad district, they said.
Police had questioned the trio earlier this month and had asked them to report again today for further questioning. They were arrested when they arrived at the police station.
Last year, the crime branch (economic offences) wing here had conducted searches at the Amway office at Thrissur, Kozhikode and Kannur as part of its crackdown on money chain scheme activities. Their godowns at these centres were closed and goods produced were also seized.
The searches were launched following a complaint lodged by Visalakshi of Kozhikode claiming that she had incurred losses.
William Pinckney is already facing a similar criminal case in Andhra Pradesh. The trial of the criminal case against Amway India has been going on in Chief Metropolitan Magistrate court at Nampally, Hyderabad for the last several years. Five more criminal cases are pending investigation in various police stations throughout Andhra Pradesh - Pattabhipuram police station, Guntur, Chikkadapalli police station, Hyderabad, Nacharam police station, Cyberabad, Governorpet police station, Vijayawada.
When criminal case was filed against Amway India, the company filed a writ petition in AP High Court and the in its judgement, the AP High Court held that the business model of Amway Indi Enterprises is illegal and attracted the provisions of Prize Chits and Money Circulation Schemes (Banning) Act, 1978. Later, the Supreme Court also upheld the judgement of AP High Court after the Amway India filed a special leave petition

---

Why Amway is not taking legal recourse to resist criminal case?

May 29, 2013, 9:34 pm

≫ Next: Gullible housewives lose money in Amway tangle

≪ Previous: Amway India Chairman, 2 Directors arrested

$

0

0

With the arrest of chairman and chief executive officer of Amway India Enterprises William S Pinckney and two of the directors, an average person naturally thinks why Amway is not taking legal recourse to resist the criminal cases against the company and its executives.

In fact, Amway India has no legal recourse left for it as it has exhausted all its chances way back in 2006.

After the Criminal Investigation Department’s Economic Offences Wing (EOW) headed by the then superintendent of police V C Sajjanar filed a criminal case against the Amway India, the company reacted immediately and filed a writ petition in the Andhra Pradesh High Court appealing the court to declare its business model as legal. It boasted that it has been following the same business model in about 60 countries.

However, the Andhra Pradesh High Court thoroughly dissected the business model of Amway India and stated to the effect that its business model is nothing but a camouflaged money circulation scheme with the company making easy and quick money.

In a nut shell, the AP High Court held that the business model of the company attracted the provisions of Prize Chits and Money Circulation Schemes (Banning) Act, 1978. The Amway India then preferred to file a special leave petition in the Supreme Court. After hearing the legal luminaries like Soli Sorabji on behalf of the Amway India, the Supreme Court upheld that judgement of the AP High Court and instructed the CID of AP to complete the investigation and file the charge sheet in six months. Now, the criminal case is pending trial in the Chief Metropolitan Magistrate Court, Nampally, Hyderabad.

In this backdrop, there is hardly any legal course left for Amway India when a young IPS officer Jayanth Jayanathan proceeded against the multinational company and filed a criminal case against it. However, the Amway India encouraged its IBOs to take out a procession to the chief minister’s residence to appeal that they lost their livelihood. The things seemed subsided for a while.

However, once the law is set in motion, it would take its own course to take the case to its logical end.

That is exactly what is happening now. The criminal case was filed and the accused has to be arrested to be produced in the court of law. Then the charge sheet would be filed and the trial to be commenced. The accused secured the bail but has to attend the trial as in the case of Nampally court where they are regularly attending the trial for the last several years.

The judiciary has to decide whether people are losing livelihood or being robbed.

Gullible housewives lose money in Amway tangle

May 29, 2013, 9:42 pm

≫ Next: Amway India chief likely to appear before ED today

≪ Previous: Why Amway is not taking legal recourse to resist criminal case?

$

0

0

http://newindianexpress.com/states/kerala/Gullible-housewives-lose-money-in-Amway-
tangle/2013/05/29/article1610789.ece


By Athul Lal AG / Arun M | ENS - KOZHIKODE 29th May 2013 08:43 AM

The meltdown of US direct-selling giant Amway seems to have begun in Kerala with 
the arrest of its CEO William Scott Pinckney and two directors from Kozhikode on 
Monday. Police officials probing the case believe the amount of fraud detected is 
only a tip of the iceberg as Amway does country-wide operations.

And at the receiving end are a bunch of gullible housewives from the lower middle 
income bracket who have unwisely invested hard-earned money in this venture eying 
the quick returns promised by Amway.

Madhavikutty, 53, of Mukkam in rural Kozhikode had invested in Amway as a shortcut 
to multiply her money to construct a house. As her husband was bedridden, the 
income from her beauty parlour at Mukkam was the family’s only revenue. She came 
to know about Amway through her friend, who was a native of Pavangad in Kozhikode.

“The training sessions that I had attended were literally a magic world. Their 
words were so trustable that those who attend the class would definitely join the 
network. I also did join by remitting a fee of Rs 999 and became an Independent 
Awmay Business Owner (ABO) with Amway. Then, I attended similar sessions in Kochi, 
Thrissur and Coimbatore and had purchased products worth Rs19,000,” recollected 
Madhavikutty.

“During the training sessions, the company enticed us by introducing certain 
persons who had become millionaires by selling Amway products.

“They always compelled us to sell the products and recruit people to make money. I 
had bought almost 90 per cent of the products marketed by Amway. Due to the heavy 
pricing, we could not sell the products. And the company refused to accept the 
unsold products. In the process, I lost around `6 lakh, the amount which my 
husband had received while retiring from service,’’ she said.

Vishalakshi, 48, of Vengerimadom near Chathamangalam had invested Rs 3 lakh in 
Amway in terms of purchasing products and taking insurance policy. 

Amway India chief likely to appear before ED today

May 31, 2013, 12:17 am

≫ Next: Amway's products prices inflated, says Indian Express report

≪ Previous: Gullible housewives lose money in Amway tangle

$

0

0

HYDERABAD: Amway India chairman and managing director William Scott Pinckney would 
appear before Enforcement Directorate (ED) authorities in Hyderabad on May 31 to 
answer alleged violations of the Foreign Exchange Management Act (FEMA) by his 
company. 

Though the Amway India chief had appeared before the ED authorities in Hyderabad a 
few months ago, as they were not satisfied with his replies, he was summoned 
again. Though Pinckney along with two other Amway directors was arrested in Kerala 
on Monday, he was later released on bail and the ED expects him to appear before 
them next Friday. 

The Kerala police had arrested Pinckney on charges of cheating and violation of 
the Prize Chits and Money Circulation Schemes (Banning) Act 1978. The AP high 
court had earlier held as illegal the multi-level marketing methods (MLM) of 
Amway. The Reserve Bank of India (RBI) too issued guidelines which clearly put the 
activities of Amway under the purview of banned activities like lottery and 
gambling. Foreign Exchange Management (Current Account) Rules 2000 issued by the 
RBI brings multi-level marketing techniques and methods under the schedule of 
banned activities. Amway India has been accused of repatriating crores of rupees 
from India to the US, where its headquarters is located. Rules do not permit such 
repatriations particularly in respect of monies that were made out of gambling and 
lotteries. 

In his first deposition before the ED earlier, Pinckney told them that Amway had 
obtained the necessary approvals from the Foreign Investment Promotion Board 
(FIPB) before setting foot in India in 1999. But, later several courts in India 
including the Supreme Court had held that the kind of activities being promoted by 
Amway and other multi-level marketing firms were nothing but gambling and hence, 
cannot be permitted. 

In fact, RBI came out more clearly in this regard wherein it said that multi-level 
marketing is akin to lottery and gambling. Earnings from such activities made here 
by foreign firms should not be repatriated to foreign shores. But Amway has been 
doing this for one-and-a-half decades and it has already sent out several hundred 
crores of rupees to the US, official records say. 

The Times of India (M Sagar Kumar, TNN | May 30, 2013, 02.19AM IST)

Amway's products prices inflated, says Indian Express report

May 31, 2013, 11:41 pm

≫ Next: Kerala orders probe into Amway chief's arrest

≪ Previous: Amway India chief likely to appear before ED today

$

0

0

Amway sells G & H Body Shampoo and G & H Lotion 250 ml through its ABOs (Amway 
Business Owners) for Rs 395 each. Believe it or not, the real prices of these 
products are just Rs 51.49 and Rs 34.19 respectively.

A list of 119 products marketed by Amway, that was seized by the Crime Branch 
Economic Offences Wing, during the raid at the firm’s offices in Kochi recently, 
clearly exposes this. The list comprises the product code, name, real price and 
selling price of products.

“Almost all the products are sold up to ten times more than their original prices. 
It has been revealed that around 49.75 per cent of the price paid by the end 
consumer goes as incentives or commission to ABOs in the up line of the market 
chain. We suggest the public to cross-check the prices of Amway products with 
those of similar products of other companies. In spite of any value addition, the 
products are heavily priced,” said P A Valsan, SP, Economic Offences Wing of the 
Crime Branch.

What’s more surprising is that only a few of the products marketed by Amway are 
brought from abroad. “Most of the products are outsourced from various Indian 
companies including Sarvotham Care and Naiza Laboratories in Himachal Pradesh, 
Soft Gel Health Care, Chennai, Aura Personal Products, Utharanchal, Aero Pharma, 
Mumbai, Fiabila Limited, Raigarh, Avalon Cosmetics, Mumbai and the KLF Nirmal 
coconut oil based at Irinjalakuda. In short, Amway procures products from domestic 
companies and sells them here at six to ten-fold prices,” said DySP P P 
Sadanandan, who has done extensive research into money chain frauds in the 
country.

He is also the investigating officer in the Tycoon Empire money chain case. 
Police said the generation plan being followed by Amway is the most dangerous of 
all the multi-level marketing plans in terms of the percentage of people losing 
money in the scheme. “Anyone can sponsor any number of persons as his direct down 
line. The unlimited facilitation of enrollment and staircase commission structure 
makes the plan arithmetically infeasible.

Kerala orders probe into Amway chief's arrest

May 31, 2013, 11:55 pm

≫ Next: More Sajjanars, Raghuram Reddys, Jayanths, Valsans are needed to tackle crooks

≪ Previous: Amway's products prices inflated, says Indian Express report

$

0

0

The Kerala government on Friday ordered a probe into the circumstances that led to the arrest of network marketing firm Amway India's chairman and CEO William S Pinckney, an American national.

Kerala minister Thiruvanchoor Radhakrishnan asked the South Zone ADGP Shanker Reddy to conduct an investigation into the circumstances that led to the arrest of the Amway chief by the state crime branch in connection with fraud cases registered against him.

A team of officials from Amway had met the home minister the other day and submitted a complaint about the arrest of their chief, official sources said.

In the backdrop of police action against Amway, corporate affairs minister Sachin Pilot had stated in Delhi on Thursday that the government is looking to remove the legal ambiguities to differentiate between fraudulent Ponzi schemes and genuine businesses run by "reputed and law-abiding" entities.

"We (Corporate Affairs Ministry) will work closely with concerned ministries and industries to remove the ambiguity in the law (related to tackling Ponzi and other fraudulent schemes) as soon as possible," he had stated.

Pinckney and directors Sanjay Malhotra and Anshu Budhraja were arrested by the Wayanad District Crime Branch (Economic Offences) wing from Kozhikode on May 27 in connection with three fraud cases registered in Wayanad district.

They were booked under the Prize Chits and Money Circulation Schemes (Banning) Act based on complaints filed by distributors in 2011.

A local court in Waynad had granted conditional bail to Pinckney and the two company directors a day after their arrest.

The arrests were based on complaints filed in the Meppady police station by distributors Ashraf and Jaffer in Wayanad district.

The complainants accused the company of failing to ensure the promised benefits to those who joined the network marketing business. They alleged that the company had forced them to buy Amway products which included cosmetics and protein powder for huge sums of money