ED attaches Rs 757 crore worth assets of Amway India
The Enforcement Directorate has attached assets worth Rs 757.77 cr belonging to Amway India in connection with an investigation into its multi-level marketing programme.
The attached properties include land and factory building of Amway at Dindigul district in Tamil Nadu, plant and machinery, vehicles, bank accounts and fixed deposits, the ED said in a statement on Monday.
The attached assets include immovable and movable properties worth Rs 411.83 cr and bank balances of Rs 345.94 cr from 36 different accounts belonging to Amway, it said.
According to the ED, it came to light during its investigations that Amway was running a "pyramid fraud in the guise of direct selling multi-level marketing network".
It was observed that the 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.
"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 the hike of prices of the products," it said.
The ED claimed that Amway India collected Rs 27,562 crore from its business operations from 2002-03 to 2021-22 and out of this, it paid commission of Rs 7,588 crore to its distributors and members in India and in the United States between 2002-03 and 2020-21.
"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 statement said.
According to the ED statement, Amway has brought Rs 21.39 crore as share capital in India in 1996-97 and till 2020-21, the company has remitted Rs 2,859.10 crore in the name of dividends, royalty and other payments to their investors and parent entities.
"M/s. Britt Worldwide India Private Limited and M/s. Network TwentyOne Private Limited also played a major role in promoting the pyramid scheme of Amway by conducting seminars for joining members under the guise of sale of goods by enrollment of members in the chain system. The promoters are conducting mega conventions and flaunted their lavish lifestyle and used social media to lure gullible investors," it claimed.
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