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Direct selling industry clocks slow growth this year: IDSA

| direct selling industry, Indian Direct Selling Association (IDSA), Network Marketing - MLM News | December 5, 2014

#DirectSellingIndustry #IndianDirectSellingAssociation #AjayKhanna #IDSA

The direct selling industry in India touched Rs 7472 crore in revenues in 2013-14, up marginally from Rs 7164 crore in the previous year.

Indian Direct Selling Association (IDSA) in association with PHD Chamber of Commerce and Industry (PHDCCI) unveiled Annual Survey Report 2013-14 on the Indian Direct Selling Industry.

“Direct Selling Industry reached Rs 7472 crores in 2013-14 from Rs 7164 crores in 2012-13 and Rs 6,385 crore in 2011-12. Due to regulatory bottlenecks, the sector has marked a significant decline in its overall growth this year’ informed  Chavi Hemanth, secretary general, IDSA.

The total sales revenue by firms during 2013-14 can be split up in to total sales revenue of Rs 7,024 crore by the companies belonging to organised sector and Rs 448 crore by the unorganised sector.

Ajay Khanna, chairman, IDSA informed that as per the survey, Bengaluru was ranked the most attractive market followed by Delhi, Ludhiana, Mumbai and Jaipur in 2013-14.

The northern region registered a growth of 12.2 per cent in 2013-14 as against 33 per cent in 2012-13. The northern region contributed around Rs 2,170 crores to the gross sales revenue in 2013-14.

In contrast, the Eastern region has contributed around Rs 1345 crore to the gross sales revenue in 2013-14.

The eastern region has scripted marginal increase in share to gross sales revenue at 18 per cent in 2013-14 from 17 per cent in 2012-13 and has registered growth rate of 10.4 per cent in 2013-14 as against 19 per cent in 2012-13. The North East has contributed around Rs 897 crore in 2013-14.

“The North Eastern region has also scripted a marginal increase in share to gross sales revenue at 12 per cent in 2013-14 from 11 per cent in 2012-13. The region has exhibited a decline in the growth scenario at 13.8 per cent in 2013-14 from 27 per cent in 2012-13,” IDSA stated.


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Direct sale, teleshopping to be under Consumer Protection Act

| direct selling industry, Indian Direct Selling Association (IDSA), MLM Law | December 5, 2014

#Teleshopping #Ecommerce # DirectSelling #ConsumerProtectionAct
The government is planning to include direct selling and teleshopping into the ambit of the amended Consumer Protection Act of 1986.

Officials said not only e-commerce, but all  purchases, hiring of services and goods sold through direct selling or teleshopping would be included in the proposed amendments to the Act. The amendments are expected to be placed before the Union Cabinet soon and would then be tabled in the Parliament.

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Amway organizes workshop on Healthy Living for South East Division of Kolkata Police

| Amway India, direct selling industry, Network Marketing - MLM News | December 5, 2014

Amway organizes workshop on Healthy Living for South East Division of Kolkata Police
#DirectSelling #AmwayIndia #MLMNews
Direct selling FMCG Company Amway India has organized a workshop on Healthy Living for Personnel of Kolkata Police on Wednesday.

The workshop, part of Amway’s wellness campaign on healthy living is specially designed for  Police Personnel by Amway India keeping in  mind the stress at work and hectic lifestyle they are exposed to.

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New Zealand woman among four held in MLM racket

| MLM Fraud, Network Marketing - MLM News, Ponzi Scheme | December 5, 2014

#Hithese Modi #Kiran Modi #MLM racket #Mohammad Khurram #multi-level marketing racket #Socialmediatechnnologies

Bengaluru: Unearthing an international online multi-level marketing racket, city police have arrested four persons, including a woman New Zealand national, for allegedly collecting about Rs 50 crore illegally using social media platform to lure people to join their web-based company.

 The four arrested have been booked under sections of the Prize Chits and Money Circulation Scheme (Ban) Act and Indian Penal Code section 420 (cheating), police said today.

“We have arrested four persons including a New Zealand national for illegally collecting Rs 50 crore through social media network,” a City Crime Branch (CCB) statement said.

Acting on a tip-off, the CCB sleuths raided a hotel room here yesterday where the accused were explaining, advertising and collecting enrolment fee from ‘victims’ of “YOBSN Social Media Network MLM company”, it said.

Action was also being proposed against the hotel for not sending Form-C to Foreigner Regional Registration Offices (FRRO) and allegedly abetting the accused, police said.

The portal “www.Socialmediatechnnologies.Com‘ is hosted from the United States of America, they said.

The foreign national has been identified as Driver Denise, who is the “Asia-Pacific Head” of the company.

She had been camping in the hotel since October 9 holding marketing sessions, they said.

The other persons arrested are Mohammad Khurram, Kiran Modi and Hithese Modi, all residents of Bengaluru.

Further investigation was on, police said without giving details about the exact modus operandi of the accused.

Preliminary investigation revealed that Denise has enrolled more than 30,000 people across the world and had collected millions of dollars worth about Rs 50 crore, police said.

Most of her members belonged to US (2,000), India (1,700), Malaysia (28,000), New Zealand (500), Dubai (200), Pakistan (100).

In India, her members are located in Karnataka (300), Maharashtra (800), Delhi (100), Punjab (100), Madhya Pradesh (300) and Hyderabad (100), they added.

Khurram has introduced 2,000 members and received US Dollar 10,000 as commission, police said.  


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14 chit fund companies will be prosecuted: Jaitley

| chit fund scam | November 28, 2014

#ChitFundCompanies #ChitFundScam #ChitFund

Finance Minister Arun Jaitley has said that the government will start prosecuting proceedings against 14 firms for violating the company law. The 14 firms fall under the category of chit fund companies.

The government would also share details of its findings with respect to these companies with the Central Bureau of Investigations (CBI).

“Central government has internal investigated affairs of 14 companies falling in the category of the so called ‘Chit Fund Companies’ for violation of the Companies Act,” Finance Minister Arun Jaitley, who also holds the portfolio of Corporate Affairs, said in a written reply to the Lok Sabha.

“It has been decided to prosecute such companies under various provisions of companies act and to also share the findings of investigations with the CBI which is also investigating various alleged criminal activities of such companies,” Jaitley added.

The minister was replying to a query on whether the government is looking into non-chit fund companies that are misusing public money by operating as chit fund companies.

According to Jaitley there were no provisions relating to chit funds or chit fund companies under the companies law.

“Provisions to this effect are contained in the Chit Funds Act, 1982 which is Central Act administered by the Ministry of Finance (Department of Financial Services) but its implementation vests in the state government concerned…” he added.

Separately on corporate frauds, Jaitley also informed the house that a Market Research and Analysis Unit (MRAU) was set up un 2009 in the SFIO — ministry’s investigation arm for corporate frauds.

“MRAU analyses media reports as well complaints received in SFIO on matters containing financial frauds by companies,” Jaitley said.

“It also assists SFIO teams engaged in investigation of chit fund cases like Saradha Realty and others by providing analytical support, updates of information in the public domain and obtaining inputs from various enforcement agencies.

According to the Minister, the unit “has been strengthened” with the induction of appropriate technical tools and skilled manpower.

“A forensic laboratory equipped with the state of art technology has also been set up under the supervision of MRAU to enhance data analytics capabilities,” he said.


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Rich India Proprietor Seeks Anticipatory bail

| Financial Frauds, MLM Fraud, Network Marketing - MLM News, Ponzi Scheme | November 28, 2014


CHENNAI: Prime accused in the assault of a teacher inside a city school, D Arulanandhu, proprietor of Rich India Ltd., approached a Sessions Court on Tuesday seeking anticipatory bail.

A 35-member gang led by him assaulted S Bhaskar Raj, physical training instructor of Loyola Matriculation School, Kodambakkam, after he allegedly punished his son, a class VIII student, for whistling on November 20.

Police had arrested 25 persons in connection with the incident, including Rich India Ltd’s executive director Mahesh, gym in-charge Krishnamoorthy, vice-presidents Bala Subramani and Arunagiri, executive officer Velusamy, and chief business officer Dhaya Kumar.

Arulanandhu, a native of Trichy who had absconded immediately after the incident, also runs an IAS coaching centre in Kodambakkam. He was also a prime accused in a MLM (multi-level marketing) cheating case in 2003.

Police are also on a look out for his brother, Sebastian, native of Karumandapam, Tiruchy, who also has approached the court seeking anticipatory bail claiming innocence.

Meanwhile, P Senthil Nathan, Bala Subramanian and P Velusamy, arrested and detained in Puzhal prison have filed bail petitions before the Principal Sessions court. The Principal Sessions judge has directed the police to file reply and adjourned the matter to December 1.


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Direct selling sales up just 4.3%, policy uncertainty blamed

| Indian Direct Selling Association (IDSA), Network Marketing - MLM News | November 28, 2014

#RegulatoryIssue #IDSA #DirectSelling #PCMCS

The Indian direct selling industry grew 4.3 per cent in 2013-14 and achieved sales of Rs. 7,472 crore, a sharp decline from previous fiscals, according to the industry’s annual survey conducted by the Indian Direct Selling Association (IDSA) and the PHD Chamber of Commerce.

Sales grew at 12.2 per cent (Rs 7,164 crore) in 2012-13 and 22 per cent (Rs 6,385 crore) the year before. The survey estimates industry turnover at about Rs. 24,000 crore by 2019-20.

“The dip in sales is on account of lack of policy. There is no clarity and the industry faces much uncertainty. That’s what we’ve been asking the Government for over the last six or seven years,” said Chavi Hemanth, Secretary General, IDSA.

Reports indicate that the Finance Ministry is looking to make changes to the Prize Chits and Money Circulation Scheme (PCMCS) (Banning) Act of 1978 to prevent the spread of ponzi schemes. However, direct selling companies have often come under the scanner of the Act, evidenced by the arrest of Amway CEO William Pinckney and two company directors in Kerala last year.

“The Ministry of Consumer Affairs (MoCA) has also come forward to support the industry and frame a separate law. What shape it will take will only be known by next year. They’re consulting with us and other chambers of commerce and institutes like ICRIER. There are also changes being made to the Consumer Protection Act to clearly define direct sellers,” added Hemanth.

Only West zone sales show positive growth

The survey, based on responses from 52 direct selling entities and 3,580 consumers, found that while shares to gross sales had increased marginally across all zones except the south, only the western region had shown a positive growth rate in sales.

Contributing Rs. 1,197 crore, the region comprising Maharashtra, Gujarat, Goa, Rajasthan and two Union Territories, had increased its share to 16 per cent in 2013-14 and registered a growth rate of 11.4 per cent, up from 9 per cent the previous fiscal.

“Two years ago, I would get 3-4 enquiries each month from companies interested in coming to India. But with the policy uncertainty, those numbers have fallen. We are hopeful of a positive policy outcome in the next two years,” stated Hemanth, who believed that e-commerce establishments were not competitors and overlaps were inevitable.

Currently, 62.37 lakh direct sellers are registered with IDSA of which 43.93 lakh are active sellers. The ratio is skewed in favour of women who in 2013-14 made up 58.3 per cent of the workforce. IDSA members paid Rs. 1,063 crore in taxes in 2013-14 as against Rs. 986 crore a year earlier.


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direct selling industry is misunderstood, few facts about Amway: William Pinckney

| Amway India, Network Marketing - MLM News | November 26, 2014

Much of the confusion about the #Amway business is surrounded by our direct selling business model. We want to be clear: distributors earn money only when a product is sold. The bonuses paid to distributors are based on personal and group sales volume. No commission is paid on recruiting or introducing an individual into the business.

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