Amway Pyramid Scam in Name of Direct Selling, ED Attaches Rs 758-Crore Assets, What We Know | #phishing | #scams


The ED has attached Amway India’s properties across the country

The ED issued a provisional order under the Prevention of Money Laundering Act (PMLA) for attachment of assets worth Rs 757.77 crore belonging to Amway India

  • Last Updated:April 19, 2022, 12:07 IST
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The Enforcement Directorate, or ED, has attached assets worth Rs worth over Rs 757 crore of one of the country’s most known multi-level marketing (MLM) and direct-selling companies, Amway India, as part of a money-laundering investigation. The central agency said that the company was using consumers to create a ‘pyramid’ scam, which only focuses on how members can become rich and is not focussing on the actual products. The ED has attached Amway’s assets across India, the probe agency has said in a statement.

ED Attaches Amway’s Assets: What We Know

  1.  The ED issued a provisional order under the Prevention of Money Laundering Act (PMLA) for attachment of assets worth Rs 757.77 crore belonging to Amway India Enterprises Private Limited, it said in a statement on Monday. The probe agency further said the company is accused of “running a multi-level marketing scam”.
  2.  “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 ED alleged in its statement.
  3.  The money laundering probe by the Enforcement Directorate found out that Amway brought Rs 21.39 crore as share capital in India during 1996-97 and till the financial year 2020-21, it remitted a “huge” amount ranging in hundreds of crores in the name of dividend, royalty and other payments to their investors and parent entities. Companies like Britt Worldwide India Private Limited and Network Twenty One Private Limited also played a “major role” in promoting Amway’s pyramid scheme by conducting seminars for joining members under the guise of sale of goods by enrolment of members in the chain system, it alleged.
  4.  The attached properties include land and factory buildings of Amway located in Dindigul district of Tamil Nadu, plant and machineries, vehicles, bank accounts and fixed deposits. Of the total attachment value, immovable and movable properties are worth around Rs 400 crore, while the remaining amount is deposited in 36 bank accounts “belonging” to Amway, the central agency said.
  5. Amway said the ED action was with regard to an investigation dating back to 2011 and since then, the company has been cooperating with the agency and has shared all the information sought by it from time to time. “Amway has a rich history of maintaining the highest levels of probity, integrity, corporate governance and consumer protection, which are much ahead of time in the interest of the consumers at large,” the spokesperson said.
  6.  ED said that Amway provoked common, gullible people to join the company by promising them that they would get rich. The new members, it said, are not buying the products to use those, but to become rich by becoming members as showcased by the upline members.

(With inputs from PTI)

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