Pyramid fraud Pyramid fraud: ED attaches assets worth Rs. 757 crore to Amway India
New Delhi/IBNS: Assets worth over Rs. 757 crore belonging to direct-selling consumer goods company Amway India have been attached under the anti-money laundering law, the Enforcement Directorate (ED) said on Monday.
"The provisionally attached properties of Amway India Enterprises Pvt Ltd. include land and factory building at Dindigul district in Tamil Nadu, plant and machinery, vehicles, bank accounts and fixed deposits," the ED said in a statement.
Out of the total Rs. 757.77 crore of assets attached under the Prevention of Money Laundering Act (PMLA), immovable and movable properties are worth Rs. 411.83 crores.
The rest are bank balances of Rs. 345.94 crores kept in 36 accounts belonging to Amway, the ED said.
The Enforcement Directorate accused the company of running a multi-level marketing "scam" where prices of most of the products offered by the company were "exorbitant as compared to the alternative popular products of reputed manufacturers available in the open market".
"A money laundering investigation by the ED revealed that Amway is running a pyramid fraud in the guise of direct selling multi-level marketing network," the probe agency said.
"Without knowing the real facts, the common gullible public is induced to join as members of the company and purchase products at exorbitant prices and are thus losing their hard-earned money.
"The new members are not buying the products to use them, but to become rich by becoming members as showcased by the upline members. Reality is that the commissions received by the upline members contribute enormously in hike of prices of the products," it added.
"The entire focus of the company is about propagating how members can become rich by becoming members. There is no focus on the products. Products are used to masquerade this MLM Pyramid fraud as a direct selling company," the agency said.
Responding to the charges, Amway India said, "The action of the authorities is with regards to the investigation dating back to 2011 and since then we have been co-operating with the department and have shared all the information as sought for from time to time since 2011."
"We will continue to cooperate with the relevant government authorities and the law officials towards a fair, legal, and logical conclusion of the outstanding issues," the company said.
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