Saturday 10 October 2009

Amway is still looting my country and many countries

Let us have a look at an interesting portion of Andhra Pradesh High Court judgement. Amway apologists may content that the business plan has been modified after the court verdict. Still, the Amway India which used to rob the house may now be only picking pockets, is still a thief looting our country. READ and enjoy the following excerpts.
The learned Advocate General (appearing on behalf of the Andhra Pradesh State Governmetn) referred to diagram contained in the said brochure (published by Amway India) and pointed out that the whole scheme is evolved in such a manner that a person who joins as distributor is required to enroll six persons and each of the six persons would enroll four persons who in turn would enroll three persons each and, in this manner, the strength of the entire group becomes 103.
He further pointed out that the money the person at the top of the group is supposed to get according to the scheme includes the money which, the other 102 persons, who are directly or indirectly sponsored by the first member, pay either towards subscriptions (initial/renewal) or by selling products. The learned Advocate General argued that there are reciprocal promises involved in the scheme. He submitted that while the promoter gets money from the members as a consideration for promise made to pay them money on the happening of event or contingency relative or applicable to the enrollment of new members, the members earn easy or quick money in redemption of the promise so made by the promoter. He controverted the arguments of the learned counsel for the petitioners that there is no compulsion or coercion to sponsor the members.
The learned Advocate General then argued that petitioner No.1 (Amway India) evolved a mechanism where introduction of new members is made so attractive and luring that every distributor strives for sponsoring others in order to earn more and more money consequent on the enrollment of new members. He also submitted that the scheme as is being implemented was not the one wThe learned Advocate General referred to diagram contained in the said brochure and pointed out that the whole scheme is evolved in such a manner that a person who joins as distributor is required to enroll six persons and each of the six persons would enroll four persons who in turn would enroll three persons each and, in this manner, the strength of the entire group becomes 103. He further pointed out that the money the person at the top of the group is supposed to get according to the scheme includes the money which, the other 102 persons, who are directly or indirectly sponsored by the first member, pay either towards subscriptions (initial/renewal) or by selling products. The learned Advocate General argued that there are reciprocal promises involved in the scheme. He submitted that while the promoter gets money from the members as a consideration for promise made to pay them money on the happening of event or contingency relative or applicable to the enrollment of new members, the members earn easy or quick money in redemption of the promise so made by the promoter. He controverted the arguments of the learned counsel for the petitioners that there is no compulsion or coercion to sponsor the members. The learned Advocate General then argued that petitioner No.1 evolved a mechanism where introduction of new members is made so attractive and luring that every distributor strives for sponsoring others in order to earn more and more money consequent on the enrollment of new members. He also submitted that the scheme as is being implemented was not the one which was placed before the Government of India or the one which is pleaded in the writ petition.
In order to fortify his contention that easy/quick money is involved, the learned Advocate General referred to para-11 of the counter affidavit of the Deputy Superintendent of Police, Economic Offences Wing, CID, Hyderabad (Respondent No.6). It would be convenient to extract para-11 herein below:
“ 11.Easy/quick money and it being dependent on enrollment of members:
a) A substantial sum of Rs.1,800/- out of Rs.4,400/- is credited direct to the account of “Amway”. It is stated on behalf of the company in the Writ Petition that it enrolled 4,50,000 distributors all over India. Taking this as correct, a sum of Rs.81,00,00,000/- (Rupees Eighty One Crore) is appropriated by the company at the time of enrollment of the members itself. This cannot but be stated “easy/quick money” got by it from the so called distributors/member de hors any service.
b) The terms and conditions of “Distribution Renewal from”, supplied by “Amway” shown as Annexure-3 read as follows:
Condition No.3: “The distributorship agreement if not renewed by Amway shall stand terminated on 31 December or on expiry of one year from the date of distributorship, as the case may be.”
Condition No.12: “The Renewal of subscription fee including Block Renewal subscription fee is non-refundable.”
Condition No.14: “Renewal of subscription fee is mandatory to continue with business and maintain your position in line of sponsorship”
Thus, from 4,50,000/- distributors the company would get a sum of Rs.45,00,00,000/- (rupees forty five crores) (4,50,000 x 995) per annum on completion of every year which can only be stated to be “easy/quick money” sans any service to the distributors/members.
c) To enable him to get the so called commission @ 3% every month, the ABO has to distribute/purchase/sell products worth Rs.2,000/- of “Amway” every month or else he will not be eligible to get any commission or continue as member in the scheme. Thus, each member is forced/induced/lured to purchase the products worth Rs.2,000/- every month to keep his chance of getting commission alive. Thus, “Amway” would automatically get a business of the quantum of Rs.1080/- crores (4,50,000 x 2,000 x 12(months) ) per annum which would yield an astronomical profit and it cannot but be stated as “easy/quick money” without any service to the distributors/members irrespective of whether they sell the products or not, though the company may conveniently refer it as “turnover by sale of products”.

11 comments:

Tex said...

Is this a judgment or the prosecution's (lame) side of the story?

dtytrivedi said...

well, shyam did u ever asked to other people, i doubt it because i verfied from 4-5 countries--- the plan is same but the way it has been said its completely wrong, wrong wrong wrong wrong

dtytrivedi said...

http://dtytrivedi.blogspot.com/2009/07/amways-sales-and-marketing-plan-is.html

here is the other side of the story, the plan is the same... and do tell me where i am wrong

dtytrivedi said...

shyam i have some thing new for u.

listen to all shyam's friends joecool, legal scanner and quixtariscult, scott johnson,and david this all for u guys

http://businesstoday.intoday.in/index.php?option=com_content&task=view&id=12731&issueid=66
go this link

now u all read the stuff and enjoy.

well this business today is india's leading magazine they are not foolish enough to put stuffs like amway.

and for shyam i think this is the best credible source if not the news.

or u still believe in the opinions of people

IBOFB said...

Indeed, let's have a look at just some of what you cite from the judgement -

the whole scheme is evolved in such a manner that a person who joins as distributor is required to enroll six persons and each of the six persons would enroll four persons who in turn would enroll three persons

Completely false. First of all, this is the plaintiff in the case speaking, and making accusations. Clearly the plaintiff is biased and trying to make a case. So, what's the reality? The reality is that a person who joins is not required to enroll anyone at all. This is easily evident by the fact most don't! Those that do can enroll as few or as many as they want. The Advocate General (the plaintiff) is simply wrong. He continues -

money the person at the top of the group is supposed to get according to the scheme includes the money which, the other 102 persons, who are directly or indirectly sponsored by the first member, pay either towards subscriptions (initial/renewal) or by selling products

Again, he is completely wrong. No money at all from subscriptions goes to the sponsor or other uplines. Part of the profit from sale of the products may go to some of the upline. This is exactly the same as in any traditional distribution business. He continues -

The learned Advocate General then argued that petitioner No.1 (Amway India) evolved a mechanism where introduction of new members is made so attractive and luring that every distributor strives for sponsoring others in order to earn more and more money consequent on the enrollment of new members

Again this is self-evidently wrong - the majority of people who join Amway do not enroll new members. Clearly it's not as attractive as he claims! Furthermore, there is no requirement at all to enroll anyone, and for any given product sales, you make less if it was generated with the aid of downline! He is wrong

I won't quote the section, but he goes on to describe membership fees as "quick and easy" money for Amway. Even if true, this is irrelevant. The the law under discussion with regards "money circulation" is about promoting a "quick and easy money" scheme to the others. This is not talking about promoting it to others, but about Amway making it! As it is, the money Amway earns from membership fees is neither quick, nor easy. They provide a large variety of services that would cost a traditional business owner significantly more elsewhere. The Advocate General is wrong.

He goes on to claim (irrelevantly, since it's not what the law is about) that Amway is also making "quick and easy money" due to the requirements for a business owner to actually have personal turnover in order to receive a bonus. He claims this requirement means they receive "Rs.1080/- crores" per annum "without any service to the distributors/members". This is absurd. It's like claiming Volvo makes money when people buy a car, but doesn't provide them with anything! Every cent of that 1080/- crores is simply revenue in exchange for a product - just like any other business. It's certainly not received "without any service to the distributors/members" and anyone saying so is, with respect, simply not being truthful. He is wrong

It's surprising, and unfortunate, the judges took any notice of him at all. Clearly with the right information they would make a different finding.

Tex said...

Shyam/Brear,

It has been well demonstrated you are BOTH Idiots!!!

I suggest you stop before you get further behind. LOL

dtytrivedi said...

i am not saying that u should go against amway, but here definitly going against amway for wrong reasons.

Sales and marketing plan which u showed is completely false. even i would tell u just go to the open meeting and ask his business structure whether it matches with it or not.

but the thing is that u are solely relying on other's statement.
And just for the moment think that if amway was doing the same what u are mentioning then amway would be bannned in 1970's during FTC investingation.

Besides this alteast amway's compensation plan has been reviewed for atleast more than 90 times as government officials are not fools to allow such money laundering schemes which u are pointing.

dtytrivedi said...

Another thing which i am repeating again but because it more relevant here.I am going to share u an excerpt fro direct selling news regarding recruiting and selling in direct sales.

"It's not just about selling the product; it's about recruiting other people to sell and become part of your lineage of sales reps," said Brent Schoenbaum, a retail partner at Deloitte & Touche. "If you're not good at recruitment and you're just selling the products, you're not going to make enough."

For the successful, direct selling can help make ends meet during the economic downturn. Direct sales also have helped supplement the incomes of stay-at-home moms, college students and full-time workers.

For more visit

http://www.chicagotribune.com/business/chi-tc-biz-sales-1008-1009-oct09,0,509306.story

Tex said...

Be sure to see my comment on the above story. LOL

Cool Blogger said...

Folks, don't take this article seriously. We all know that Amway is here to improve our lives be it with saving money, providing us with eco-friendly products or helping us become financially free. We can make a difference to people's lives by giving them the gift of health and wealth, no matter what these nay sayers say.

corporate frauds watch said...

This fellow did not reveal how much he is earning and what level he is now. At least lie lie all Amway adherents and boast that you are earning a substantial amount every month. Because of such stupid daydreamers, our country losing every year several billions of rupees.