In the name of selling provisions, NMart cheated millions

NMart, said to be a retail marketing business outlet, has been cheating the gullible for the last few years by indulging in money circulation scheme in the name of selling provisions.

The modus operandi of this cheating company is simple. The member has to enroll himself with the company through an already enrolled member by paying Rs. 5500. He would be given 48 coupons each worth Rs. 220 which could be exchanged with provisions in any retail NMart show room in the first week of every month. In effect, the customers who pay Rs.5500 up front are given provisions worth Rs.220 every month for the next 48 months i.e. four years.

More, the members could enroll new members to earn more money. For every new member enrolled the upline member would be paid Rs. 200. An ordinary person could identify the scheme as money circulation scheme.

The scheme looks very attractive. If the members could enroll hundred members, he could coolly pocket Rs. 20,000. In fact that is the bait.
These members keep on concentrating on enrolling members wherever they go with the promise of easy and quick money.

Each member may be losing Rs. 5500 but it is easy and quick money for the company. For each member, the enrolling members gets Rs. 200 only. But the company gets Rs. 5300. That way, if a member enrolls 100 persons, he would get Rs. 20,000 but the company coolly pockets Rs. 5,30,000 without any effort. That is why it is easy and quick money for the company. The company is promising returns in the next four years which is unrealistic.

In the Western countries, it is called 'advance fee fraud'. In India it is called money circulation scheme.

They even enroll new members where there are no NMart retail outlets and the coupons they are given would never be exchanged. They could not travel spending Rs. 200 to encash a coupon worth R. 200. But the real bait is enrollment. Enroll more members and earn lot of money.

Vijayawada-based Corporate Frauds Watch, a civil society organisation started by a group of socially-concerned advocates conducted inquiries into the scheme and come to conclusion that it is also a scam like Amway, Herbalife, Forever Living Products and others.

The society secretary lodged a complaint with Machavaram police in the city and later, approached the Economic Offences Wing of CID of Andhra Pradesh police but to no avail.

Later, on learning that the NMart is active in Prakasam district, the secretary went to Kandukuru and lodged a complaint with the police who registered the case under the provisions of Prize Chits & Money Circulation Schemes (Banning) Act, 1978 and Section 420 of Indian Penal Code.

Prakasam police under the guidance of the dynamic superintendent of police, Raghurama Reddy, conducted investigation into the scheme of NMart and finally, the kingpin of the scam, Gopal Singh Shekhawat and his Pratibha were arrested in Surat, Gujarat. However, after Pratibha complained that she was unwell,she was admitted in a hospital.

One may wonder why Section 420 was invoked. The Supreme Court in its 2008 judgement in Kuriachan Chacko case pointed out that the organisers of the scheme knowing fully well that it won't work forever and sooner or later the chain would be broken, are still inducing the public to become members of the scheme. That is why they should be booked also on the charges of cheating under Section 420 of IPC.

The chain is broken and several millions of people lost their hard-earned money.