Monday, 28 June 2010
Generally, the cheats who amass enormous wealth in dubious activities, claim that they have been paying taxes including Income Tax. However, the Judgement delivered by the Division Bench of High Court of Karnataka has given a blow to this argument and made it clear that on the money accumulated from the unlawful activities, the tax payer cannot claim any exemptions.
In Re Commissioner of Income Tax vs. Amarjeet Kaur (c/w ITRC of 1999 decided on January 31, 2006), the Division Bench of High Court of Karnataka unequivocally reiterated that the appellant M/s Manjog Home which is running a money circulation scheme in the guise of sale of products like refrigerators, television sets, electric and electronic goods through a 'deposit-linked incentive scheme' is nothing but a money circulation scheme and stated that such schemes are prohibited by law and therefore, the assessee in view of the Explanation inserted by Finance (No2) Act, 1998 is not eligible and entitled to claim deduction or allowance of such expenditure as an expenditure for the purpose of business or profession.
Several persons being members of fraudulent companies like Amway India claimed exemptions from paying Income Tax through out the country. Corporate Frauds Watch is taking up this issue to the Income Tax Commissioners of various States in India and make sure that the exemptions enjoyed by these individuals cancelled.
Of course, these people include GoldQuest International, Herbalife, Tupperware, Hindustan Unilever Network Ltd and others.
Saturday, 26 June 2010
The other day I was in the Andhra Pradesh High Court where five cases relating to money circulation schemes came up for hearing. The modus operandi of these all companies is to file a writ petition challenging the police action whenever a criminal case was filed against them and continue their fraudulent activities. Corporate Frauds Watch has chosen to file implead petitions in all these writ petitions including those filed by Amway India.
As many as five such writ petitions have come up for hearing on Friday and it was funny to witness how the counsel for all these fraudsters, except Amway India, struggled to convince the Division Bench that the business model of all these companies is legal. Not surprisingly, the judges on the Division Bench who are well-versed with the dubious arguments of these companies started batting on behalf of the State which filed criminal cases.
The counsel of Gemini Techno Services struggled hard to convince the Division Bench about the employment generated by the company and engaging distributors and their enrollment of more distributors was legal. Every one in the court hall was laughing at the presentation. The counsel was only trying to buy time to reopen the office of the Gemini Techno which was closed by the police. The least-convinced Division Bench commented that it was nothing but money circulation scheme and reserved the order for Monday.
The wonderful question that the Division Bench asked the defending counsel was why the company wanted to adjudicate the issue in the High Court when it was open for it to contest in a criminal court. The Division Bench also wanted to know what is Techno in its business evoking peals of laughter in the court hall.
Notable point is the special government pleader commented in his remarks that the modus operandi of Gemini Techno is same that of Amway India.
Tuesday, 22 June 2010
Monday, 21 June 2010
No matter what their sanctimonious bosses have steadfastly pretended to be reality, for more than half a century, a growing-band of counterfeit 'Direct Selling Companies' like 'Amway,' have been operating pernicious, blame-the-victim closed-market swindles, or money circulation schemes, and associated advance fee frauds, hidden behind (essentially unsaleable) products and services, and labyrinths of (apparently independent) corporate structures. In this way, the billionaire bosses of the 'Amway' mob have isolated themselves from liability and infiltrated, and corrupted, the US administration, paving the way for countless copy-cat 'Direct Selling' racketeers. Whilst senior US law enforcement agents have sat and twiddled their thumbs, the bosses of various major organized crime groups have all been allowed to peddle essentially the same commercially-suicidal 'Business Opportunity' based on disguising illegal payments as 'retail sales.' In this way, down the years, huge quantities of cash have been extracted from tens of millions of constantly-churning recruits around the globe, on the pretext that the 'Exact Duplication of a Proven Positive Plan of Recruitment and Self-Consumption' can eventually lead anyone to 'Total Financial Freedom.'
The reality-inverting tactics employed by these vile thieves are blindingly obvious once you know how they operate. Taken in isolation, associating with politicians and law enforcement agents, giving money to charity, advertising campaigns, employing celebrities, etc., can all seem to be perfectly lawful activities. However, when the wider-picture is examined, these infiltration tactics are revealed as being part of a pattern of major racketeering activity.
David Brear (Copyright 2010)
Saturday, 19 June 2010
The usual technique employed by Amway is try to involve the officials and the police to participate in various programmes and it is not new. No wonder, Rajastan police officers had fallen to the sweet talk of the crooks and organised some traffic awareness programme. They tried the same technique everywhere. But it did not work in the city of Vijayawada, Andhra Pradesh. If Amway has guts why don't they organise a similar feat at Vijayawada.
Once bitten twice shy. Recently Mr William Pinckney was chased out of Vijayawada and Amway would never dare to repeat the misadventure.
It is apt to recall here that Amway India tried to organise painting programme with Eenadu group of publications as media partner. When Corporate Frauds Watch pointed out to the management of Eenadu group of Publications, that Amway India is a cheating company and is facing criminal cases, the management realised its folly and withdrew from the programme.
Everyday we come across a number of advertisements in the classifieds section of newspapers. They offer a wide range of business opportunities like Amway always does. It is like quick fix for all the financial needs of every one. They offer huge profits in a very short span. They show heaven in your palm.
One such ad claims that it would pay Rs. 1250 every day into your account if you give them an investment of Rs. 1,00,000 (Rupees One Hundred Thousand). If anybody pays that amount he would have to lose all the amount. They always look for gullible people with lots of promises. When Corporate Frauds Watch wanted details from the advertiser, he claimed that it is a company and he would give an undertaking on a Rs. 100 bond paper. But when asked he would write a promissory note, he said in negative. When asked whether he has permission from the Reserve Bank of India, he said that it is under processing. With such type of promises, it is easy to hoodwink the gullible. No wonder many people are falling for the sweet talk and losing their hard-earned money. What more, these fraudsters employ the same method like Amway to recruit more members by offering huge commission.
A company called Peeshonu used the same technique and vanished with about Rs. 80 crore. Corporate Frauds Watch organised a meeting at the small town of Suryapet and appealed people not to fall prey to the false promises of Peeshonu owned by one Mr Saidulu. This man purchased 40 acres of land in his wife's name and now he is refusing to repay the depositors. He is facing criminal case and is still absconding.
Another company Haryana-based Golden Forest Ltd vanished with Rs. 200 crore. And now a person who worked in that company started a company in the name of Agrigold and is collecting deposits illegally from public promising them house sites.
Let us examine more such fraud cases in the next episode.
Tuesday, 15 June 2010
Monday, 14 June 2010
Baidyanath, established in 1918, manufacturer of quality Ayurvedic medicines, forayed into direct selling only to malign its reputation. The Allahabad-based firm opened its own direct selling unit in the name of Herbalage Anti-Aging Network renaming its products at exorbitant prices started network marketing.
A former Emerald of Amway India started huge campaign to recruit distributors in the coastal parts of Andhra Pradesh. He is advertising in the Classifieds of local newspapers to attract recruiters who have had experience in multilevel marketing.
The misconceived notion among people is that whoever joins first the network marketing or multilevel marketing would get benefited and the late comers would end up in losses. In fact, it is the company which gets benefited but not anyone else.
Herbalage Anti-Aging Network is set on the same lines of Amway. One could become a distributor by paying a fee of Rs. 8,766 and he would get a bunch of products along with literature at a discount of 25 per cent. If anybody does not want to become a networking agent, he could opt for an ordinary membership by paying Rs. 990. Sound any bell? Yeah, that is like Amway.
What more, the new company offers commission on accumulated basis. That is, the commission would be calculated after including the previous purchases also.
The brochure claims that the distributor could earn Rs. 17,68,563 in six months if he continuously introduced four new downline members for three consecutive months and each distributor do a minimum business of 800 business volume (BV) every month.
It is nothing but easy and quick money as decided by the Andhra Pradesh High Court in the writ petition filed by Amway India.
It is high time the police swung into action and nipped the evil in the bud.
My dear fellow Indians, do not fall prey to the crooks like this and lose your hard-earned money.
Saturday, 12 June 2010
Public memory is very short, goes the adage. But that does not mean, the historical judgements should also be forgotten.
The Andhra Pradesh High Court stated that "Thus the two ingredients are satisfied in the case of promoter too. We are, therefore, of the considered view that the scheme run by the petitioners squarely attracts the definition of "Money Circulation Scheme" as provided in Section 2 (c) of the Act." (Para 35).
This judgement was confirmed by the Supreme Court of India, which directed the police to file the criminal case against Amway India.
The Amway apologists should understand that the High Court judgement was based on the affidavit filed by Amway India.
Now the criminal case is being tried by the Chief Metropolitan Magistrate, Nampally, Hyderabad. Once the judgement is delivered, Tex and their ilk would certainly tuck their tails and slink off and Amway India would be forced to get out of the country.
If anybody wants the full text of the judgement they can access at http://skmastanvali.com.
Come out and open your eyes and realise what happened in India. The Indians are hit hard both with the products and tool scam which is actually money circulation scheme.
Some stupid fellow claims that Amway's business is legal in India. Anyway, the verbal constipation-hit Tex did not elaborate what made him to comment that Amway's business is legal in India. The criminal case is pending in the Chief Metropolitan Magistrate, Nampally, Hyderabad. The Government issued an order restraining Amway from advertising in any media about its business model and the Amway India challenged the order in the Andhra Pradesh High Court. A civil society organisation PASS filed an implead petition in that writ petition. It is yet to come to the Bench for hearing. Suddenly, some pigheaded fellow claims that the crooks' business model is legal in India.
Above all, the Indian Direct Selling Association is complaining in a section of press that some other companies are cheating people in the name of direct selling. It is like pot calling kettle black.
It is apt to state here that another criminal case was filed against Amway India by the Corporate Frauds Watch at Ramachandrapuram police station recently along with six other companies.
Whenever and wherever possible, more criminal cases would be filed against Amway India and other companies which are indulging in money circulation scheme.
Meanwhile some stupid fellows like Tex who are apologists of the international crooks have been spreading canards that it is legal in India.
It is good to remind our readers here that the re-investigation petition is coming up for hearing on June 14 in the Nampally court, Hyderabad.
Friday, 11 June 2010
The manipulators are at their best when the CID of Andhra Pradesh filed the charge sheet in the Chief Metropolitan Magistrate court at Nampally, Hyderabad. In the First Information Report, the police had mentioned the Amway India as the first accused and surprisingly, when the charge sheet was prepared the name of Amway India disappeared in the list of accused. After the Press cried foul, the CID amended the charge sheet and included the name of Amway India in it.
Secondly, the CID mentioned the names of only ten persons in the charge sheet and stated that they indulged in money circulation schemes. They could only explain that how only ten persons run a money circulation scheme.
Let us compare the case of GoldQuest International in which the same CID of Andhra Pradesh prepared a list of about 2,800 persons who had pocketed more than Rs. 50,000 in the money circulation scheme run by the company by selling gold and silver coins.
It is not difficult to arrive at conclusion as to what made the CID to conduct a perfunctory investigation into the Amway scam and how only ten members involved in the money circulation scheme. That is the reason, the Corporate Frauds Watch is pursuing the demand for re-investigation of the case.
Wednesday, 9 June 2010
Several hundreds of people are reported to have approached the Commissioner of Police, Vijayawada seeking action against a realtor and demanded their money back.
Vijayawada-based VVR Housing Limited has been offering house sites to the public at a very low price for the last two years. They have even floated another firm in the name of Viswas Real Estate and started multilevel marketing. Corporate Frauds Watch immediately warned the organisers about the consequences when they advertised in newspapers. However, they continued their business tactics without advertising again. The members have to enroll two or more members each to earn sizable commission. They promised that a member could earn Rs. 1 lakh every month, if they work hard i.e. if they could cheat more people into becoming members.
Now, the cat is out of bag. It seems that they have collected Rs. 7 crore from over 700 persons and failed to register land in their name. The agitated members approached the police who have been trying to get members' money back instead of registering a criminal case against the erring company.
My dear fellow humans all over world! Do not fall prey to the evil designs of these tricksters!
Monday, 7 June 2010
Yet another multilevel marketing bubble burst at Hyderabad on 05-06-2010 with scores of victims of Sri Viraat multilevel marketing company lodging a complaint with the police against it. A number of victims went to the police and informed them about the huge promises of returns they got from the owners of the Sri Viraat. The owner of the company even promised huge commission if they bring in more members into the scheme, they said
K Srinivasa Reddy started Sri Viraat company and collected money from the public with the promise of giving back huge returns after investing the same in real estate. He promised to repay Rs. 16,800 every month for every Rs. one hundred thousand. He even promised 150 square yards of land at Yadagiri Gutta near Hyderabad.
However, he never returned any money to the investors nor registered any housing plot in their name.
It is estimated that Srinivasa Reddy has collected Rs. 45 crore and now his whereabouts are not known. Interestingly, some of the investors received short messaging service in their mobiles that they would receive their deposits soon. Police is investigating the case.
Saturday, 5 June 2010
Team Life Care India Limited, (TLC) the corporate agent of Bajaj Allianz Life Insurance Corporation, is continuing its money circulation schemes in the guise of selling insurance policies. It may be recalled that a criminal case was filed against the Bajaj Allianz and its corporate agent for indulging in money circulation schemes way back in 2009. A la Amway, both the companies have chosen to file a writ petition in the Andhra Pradesh High Court challenging filing of criminal case. However, Shyam Sundar has also filed an affidavit in the High Court.
In spite of the criminal case, the TLC is continuing its illegal money circulation scheme while selling insurance policies of Bajaj Allianz.
Recently, an elderly lady approached Corporate Frauds Watch (CFW) stating that the Bajaj Allianz is not paying the insurance amount after the sad demise of her son. CFW along with Consumers Guidance Society has taken up the issue and scrutinized the documents.
Much to their amazement, it was found out that the last installment was not submitted to the company by its agents after collecting the same from the elderly woman. When contacted, the Bajaj Allianz refused to pay the amount and the TLC coolly shrugged off its responsibility. CFW approached the police for filing a criminal case against the TLC and then the TLC officials came down for negotiations. Now, they are bargaining the amount of insurance.
CFW observed that the elderly woman was induced to buy the insurance policies with the promise of huge money only if she brings in two more persons. She was even given an identity card as an insurance agent. According to Insurance Act, no person other than a trained one, should sell insurance policies. TLC is blatantly violating the Insurance Act.