AP High Court's judgement in full against speakasiaonline

IN THE HIGH COURT OF JUDICATURE OF ANDHRA PRADESH

HON'BLE SRI JUSTICE RAJA ELANGO

 

CRL.M.P.Nos.6459 and 7016 of 2011

and

CRIMINAL PETITION No.5626 of 2011

 

SPEAKASIA ONLINE PTE.LTD.,OFFICE AT SINGAPORE, REP.BY AU.REP

VS

THE STATE OF A.P., THROUGH CID, HYDERABAD & ANOTHER, REP PP.

ORDER:

          This Criminal Petition is filed by the petitioner company namely Speakasia Online Pvt. Ltd. represented by its Authorised Representative Mr. Charan Kumar, under Section 482 Cr.P.C., seeking to quash the proceedings in F.I.R.No.30 of 2011 on the file of the Station House Officer, C.B.C.I.D., Hyderabad, registered on the basis of the complaint given by the 2^nd respondent.

The petitioner company was arrayed as an accused in F.I.R.No.30 of 2011 for the offences under Sections 420 of I.P.C. and 4, 5 and 6 r/w 2(c) and 3 of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978 (for short “the Act”).

The contents in the complaint are as follows:

i)        The business of the company is told as Online survey. The joining fee of the company is Rs.11,000/-. One must get enrolled into the scheme to join others into the scheme for commissions. Huge income is promised by the company within a short span of time. The scheme of the company is Binary scheme. Binary scheme means one person has to enrol two persons and again these two persons have to enrol two persons each and again these four persons have to enrol two persons each and this chain continues endlessly. As the network and chain of members get extended, the upline members will get more commissions.

ii)       It is promised by the company that the commission is paid not only on the personal efforts of joining members into its scheme but also on the efforts of joining new members into the scheme.

iii)      The promoters of the scheme very well knew that it is certain that the scheme was impracticable and unworkable making tall promises and for the benefit of very few who have joined the scheme at the initial stage. If each person keep on enrolling two persons, at the 15^th or 18^th  level all the Indian population and at the 24^th level all the World population will become the members of the company and there would be no member left to join/enrol into the scheme of new members by the already existing members. This will result in heavy loss of money of the enrolled members. The scheme will collapse under its own weight.

iv)      Because of misrepresentation and deceptive words, nearly 19 lakh people have joined into the scheme of the petitioner company all over India and the company got quick and easy money of Rs.5000 crore by cheating and looting all these 19 lakh people.

This Court on 13.07.2011 passed the following order:

“There shall be interim stay of arrest of Officials/Employees belonging to the petitioner company, but investigation can go on.”

Respondent Nos.1 and 2 filed petitions in Crl.P.M.P.Nos.6459 of 2011 and 7016 of 2011 respectively, with a prayer to vacate the interim stay granted by this Court on 13.7.2011.

The main contentions raised by Sri Vedula Venkata Ramana, Senior Counsel, appearing for the petitioner company are as follows:

1)   1)     First Information Report can be registered only for commission of an offence. The First Information Report should state the manner in which the offence committed. In the absence of any commission of offence, there cannot be any registration of First Information Report.

2)   2)     The entire complaint does not disclose any offence as stated in the First Information Report.

3)   3)     The complainant lodged the complaint in expectation of loss of money to the public, even prior to commission of any offence. The complaint does not disclose about the manner in which the subscribers are cheated and also the modus operandi of the petitioner company.

4)   4)     The allegations made in the complaint do not attract an offence under Section 420 of IPC.

5)   5)     Section 511 of IPC is also not registered in the First Information Report.

Hence, the prosecution cannot claim that an attempt was made to commit the offence.

The learned Senior Counsel, to substantiate his contentions, relied on a decision in “State of West Bangal and others Vs. Sanchaita Investments and others”[1][1]. In the said judgment, the learned Senior Counsel has drawn the attention of this Court regarding his first contention that there cannot be any First Information Report, when cognizable offence is not committed. He further submitted that in the said case, the Apex Court held that to attract an offence under the provisions of the Money Circulation Scheme, the following ingredients should be there:

A.      A.      there must be a scheme;

B.      B.      there must be members of the scheme;

C.       C.       the scheme must be for the making of quick or easy money on any event or contingency relative or applicable to the enrolment of members into the scheme or there must be a scheme for the receipt of any money or valuable thing as the consideration for a promise to pay money on any event or contingency relative or applicable to the enrolment of members into the scheme;

D.     D.     the event of contingency relative or applicable to the enrolment of members into the scheme will however not be in any way affected by the fact whether or not such money or thing is derived from the entrance money of the members of such scheme or periodical subscription.

The learned Senior Counsel also relied on a decision in “Indian Oil Corpn. Vs. NEPC India Ltd. and others”[2][2] wherein the principles of exercise of jurisdiction under Section 482 of Cr.P.C. are reiterated by the Apex Court on the basis of its earlier judgment.

The learned Senior Counsel further relied on a decision in “Abhayanand Mishra Vs. State of Bihar”[3][3] to substantiate his arguments with regard to preparation and an attempt to commit an offence.

In contra, the learned Public Prosecutor has submitted that the First Information Report discloses cognizable offences and in view of the order passed by this Court on 13.07.2011, the Investigating Agency proceeded with the investigation. He stated the following facts before this Court for consideration:

                i.                               i.            During the course of investigation on 25.06.2011 two franchises of Vijayawada by names (1) Devireddy Srinivasa Reddy and (2) Lanka Venkata Ayyappa Swamy were arrested as A.2 and A.3 and documents were seized pertaining to the bank accounts, agreements, cell phones and laptop from their possession and sent them for judicial custody. According to the confession of the statements of A.2 and A.3 that on attracting the advertisements of the petitioner company, with a view to earn more money in easy way by attending online simple surveys and also to enrol panellists, they joined as franchises to the petitioner company in Andhra Pradesh by depositing Rs.3 lakh each. The modus operandi of the company is if a person got registered in petitioner company, he should pay an amount of Rs.6,000/- for six months and Rs.11,000/- per annum. Further, the person required to furnish subscription code, personal details including bank account details. When he becomes panellist, once he completes the surveys, he will get Rs.500/- for each survey. The subscription is valid for 12 months. The method of survey is that the petitioner company will put a questionnaire to the subscriber about a product and its performance.

              ii.                             ii.            The I.O. visited the Registrar of Companies and caused enquiries about the registration of the alleged companies namely (1) Seamless Outsourcing LLP, Mumbai, (2) Kritanz Management & Allied Services, Mumbai, and (3) Tulasiyat Tek Pvt. Ltd., Mumbai and also addressed a letter to the Registrar of Companies for furnishing of certain information on registration of above firms.

            iii.                          iii.            On 08.08.2011 the I.O. received the information from the Assistant Registrar of Companies, Andhra Pradesh, Hyderabad in which he stated that no company in the name of “Speak Asia Online Pvt. Ltd.” is found to be registered in the Ministry of Corporate Affairs Registry.

             iv.                            iv.            The I.O. got served notices U/s 91 & 160 Cr.P.C. to (1) Manoj Kumar, CEO, (2) K. Charan Kumar, Regional Manager, and (3) Harender Kour, Global CEO of petitioner company through their advocate Sri S.S.R. Murthy to attend before him on or before 25^th July 2011. Manoj Kumar, CEO and Harendar Kour, Global CEO have not attended so far before the I.O.

The first contention raised by the learned Senior Counsel is that First Information Report can be registered only for commission of an offence. It is true that First Information Report is to be registered on commission of an offence, more particularly, for a cognizable offence. Once a cognizable offence is committed, First Information Report can be registered. But at the same time, some of the provisions in the law enable the Investigating Agency to register First Information Report for mere preparation alone, for example, Sections 120-B, 399 of IPC and 7(1)(a) of the Criminal Law Amendment Act. Further, whether an offence committed or not always depends upon the ingredients mentioned in the provision of law.

Some provisions in the penal laws made the preparation also as an offence. When the provision deals the preparation as an offence, the preparation itself is commission of offence.

In the present case, the offences alleged are under Sections 420 of I.P.C. and 4, 5 and 6  r/w  2(c) and 3 of the Act.

For the sake of convenience, Sections 2(c) and 3 of the Act are reproduced hereunder:

“2(c) of the Act: “money circulation scheme” means any scheme by whatever name called, for the making of quick or easy money; or for the receipt of any money or valuable thing as the consideration for a promise to pay money, on any event or contingency relative or applicable to the enrolment of members into the scheme, whether or not such money or thing is derived from the entrance money of the members of such scheme or periodical subscriptions.

Section 3 of the Act -  Banning of prize chits and money circulation scheme or enrolment as members or participation therein:- No person shall promote or conduct any prize chit or money circulation scheme, or enrol as a member to any such chit or scheme, or participate in it otherwise, or receive or remit any money in pursuance of such chit or scheme.”

          The said provisions, on a mere reading, indicate that there is no need of any loss or misappropriation of funds to attract an offence. Mere informing a scheme, which covered under the money circulation scheme and enrolling members as subscribers, itself is an offence. It is not necessary to further elaborate on the same, since the Sections are unambiguous and clearly indicate the acts which attract an offence.

          The view of this Court is fortified by the decision rendered by the Apex Court in Kuriachan Chacko and others Vs. State of Kerala[4][4].

          As far as the offence under Section 420 of IPC is concerned, this Court is of the view that the said case is registered along with other provisions of the Act. Further, the investigation will disclose whether an offence is committed under Section 420 of IPC.  Wrong mentioning of any provision in the First Information Report itself is not a ground to quash the First Information Report and to stay the investigation.

The facts and circumstances in the 1^st cited case (supra) are totally different from the facts and circumstances of the case on hand. It is also observed in the said judgment, whether an offence is disclosed or not must necessarily depend on the facts and circumstances of each particular case and in considering whether an offence, into which investigation is made or to be made, is disclosed or not, the Court has mainly to take into consideration the complaint or the F.I.R. and the Court may in appropriate cases take into consideration the relevant facts and circumstances of the case. On a consideration of all the relevant materials, the Court has to come to the conclusion whether an offence is disclosed or not.

Further, in the said case, the firm namely Sanchaita Investments offered fabulous interest at 48% per annum to its members and later reduced it to 36% per annum. Such high rate of interest was being paid, even though the loan certificates receipts show that the interest was liable to be paid at 12% p.a. The Apex Court felt that the said facts do not disclose any offence under the provisions of the Act. It is true, in the said facts and circumstances of the case, the essential ingredients of Section 2(c) of the Act are totally missing. The Apex Court also elaborately discussed the said fact and opined that acceptance of money and periodical interest paid by a company do not come within the purview of Section 3 of the Act. But, the facts in the present case are totally different and the invitation made by the petitioner company in the name of “surveys” discloses an offence under the provisions of the said Act.

The learned Senior Counsel further contended that the complainant failed to inform as to how he gathered the material. The same need not be proved, at this stage.

Since there was no stay of investigation, the investigation so far conducted by the Investigating Agency discloses that 21 witnesses were examined and two persons were arrested.  The investigation further reveals that 24 lakh members were enlisted, more particularly, 30000 persons were enrolled in the State of Andhra Pradesh, the money transacted is Rs.2276 crore, Rs.467.17 crore was transferred to Singapore, and so many other incriminating materials are collected.

This Court is not inclined to go into all those things, because the question before this Court is whether the investigation to be proceeded or not and hence, it is not necessary to record the manner in which the investigation proceeded in this case which will cause prejudice to either parties.

In view of the foregoing discussion, this Court is not inclined to quash the First Information Report No.30 of 2011 on the file of the Station House Officer, C.B.C.I.D., Hyderabad, and the interim stay granted by this Court on 13.07.2011 is liable to be vacated.

        Accordingly, CRL.M.P.Nos.6459 and 7016 of 2011 are allowed and the interim stay granted by this Court in Crl.P.M.P.No.5698 of 2011 on 13.07.2011 is hereby vacated and the Criminal Petition is also dismissed. Miscellaneous petitions, if any, filed shall stand closed.

                    __________________                                      

RAJA ELANGO, J

30^th August, 2011

cbs

---

[1][1] (1982)1 S.C.C. 561

[2][2] (2006) 6 S.C.C. 737

[3][3] AIR 1961 SC 1698

[4][4] (2008) X S.C.C. Page No.708

Anticipatory bail plea for speakasia accused rejected

Honourable Metropolitan Sessions Judge R Murali rejected the anticipatory bail petition filed by the speakasianoline Chief Operating Officer, Mr Tarak Bajpai, Director Mr Rajiv Malhotra, and three others Mr Charan Kumar, Mr Prem Kumar and Mr Mohiuddin after they filed the petitions in order to avoid  the imminent arrest by the AP CID, according to investigating officer of CID, Mr Sarath.

Mr Sarath told Corporate Frauds Watch that all the accused presented the petition seeking anticipatory bail in the court of the Metropolitan Session Judge, Vijayawada. Now all the accused submitted their petitions for anticipatory bail in the Andhra Pradesh High Court to avoid arrest by the CID of AP.

The CID is likely to oppose the anticipatory bail petition in the High Court.

Meanwhile the Investigating Team of the CID are ready to go to Mumbai once again to get the accused into custody. The officials say that they have to extract a lot of information regarding the fraud which involved more than Rs. 2000 crore (Rs. 20 billion)

It may be recalled the Chief Executive Officer of speakasiaonline Ms Harender Kaur and another CEO Mr Manoj Kumar has gone underground after the scandal broke out. The whereabouts of both the main accused  is still not known. It is said that they are hiding either in Singapore or Dubai.

speakasiaonline accused in CID custody

The four accused -- Rahul Shah, vice-president of speakasiaonline, Ravi Khanna, director (operations), Deepankar Kumar, general manager and web designer Sk Riyaz -- looked relaxed when they were brought to Vijayawada on Sunday from Mumbai in connection with the massive Rs. 2000 crore fraud. They were confident that the legal experts from Bengaluru would bail them out and they would be home soon. However, much to their chagrin, they found themselves in the District Jail of Vijayawada by Sunday evening.

Still, they were confident that they would seek bail and would be granted after their counsels argue on their behalf in the Third Additional Metropolitan Magistrate Court. Again much to their disappointment, they were given to CID custody for further interrogation about the clandestine operations of speakasiaonline.

The Honourable Magistrate issued orders handing them over to the CID on Wednesday. The accused are facing charges of collecting money from the gullible in the name of conducting surveys which is a money circulation scheme under the provisions of Prize Chits & Money Circulation Schemes (Banning) Act, 1978 and sending it to Singapore and other countries.

The CID would start grilling the accused continuously for five days starting Thursday. 

Let us hope that they would spill beans and the other accused would also be arrested soon. 

Government of A.P., India bans Advertisements of Speak Asia after Amway

GOVERNMENT OF ANDHRA PRADESH

ABSTRACT

Home Department- To initiate action against Speak Asia Online Pvt. Ltd / Haren Ventures Pvt. Ltd. – Issue of Notification in the official Gazette of Andhra Pradesh under section 8 of the Prize Chits and Money Circulation Scheme (Banning) Act, 1978 ( Central Act No.43 of 1978) - Notification- Issued.

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

HOME (GENERAL.B) DEPARTMENT

G.O.Ms.No. 235                                                                             Date:12-09-2011

Read:

From the Additional Director General of Police, Crime Investigation Department, Andhra Pradesh, Hyderabad, Lr C.No.2650/C13/CID/2011, dt.05-08-2011.

***

ORDER:

Whereas the Additional Director General of Police, Crime Investigation Department, Andhra Pradesh, Hyderabad, in the letter read above, has informed that, a case was registered on 21.06.2011 against the Speak Asia Online Pvt. Ltd, Singapore and other accused about their Money Circulation Scheme/Multi Level Marketing activities and fraudulently collected huge amounts from the subscribers and committed offences punishable under sections 4,5 and 6 of the Prize Chits and Money Circulation Scheme (Banning) Act, 1978 (Central Act No.43 of 1978) and requested the Government to initiate action against Speak Asia Online Pvt. Ltd/ Haren Ventures Pvt. Ltd. by notification in the official Gazette to declare every copy of the newspaper and every copy of the publication containing such material or the advertisement to be forfeited, where any newspaper or other publication is found to have contained any material connected with Money Circulation Scheme promoted or conducted in contravention of the provisions of the said Act or any advertisement or in relation thereto.

2. Now, therefore, the Government have examined the proposal of the Additional Director General of Police, Crime Investigation Department, Andhra Pradesh, Hyderabad to initiate action against Speak Asia Online Pvt. Ltd/ Haren Ventures Pvt. Ltd., carefully and decided to declare every copy of the Newspaper and every copy of the Publication / containing such material to be forfeited to the Government of Andhra Pradesh which is connected with the propagation or otherwise under section 8 of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978 (Central Act No.43 of 1978).

3. This order is available on Internet and can be accessed at website http://www.ap.gov.in/goir.

4. Accordingly, the following notification will be published in an extraordinary issue of the Andhra Pradesh Gazette Dated: 16.09.2011.

NOTIFICATION

In exercise of the powers conferred by section 8 of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978 (Central Act No.43 of 1978), the Government of Andhra Pradesh hereby declare that every copy of the News paper and every copy of the publication containing such material or the advertisement connected with any Prize chits or Money Circulation schemes as promoted or conducted by the Speak Asia online Pvt.Ltd/ Haren Ventures Pvt. Ltd in contravention of the Provision of the said Act to be forfeited to the State Government of Andhra Pradesh.

(BY ORDER AND IN THE NAME OF THE GOVERNOR OF ANDHRA PRADESH)

B.P.ACHARYA,

PRINCIPAL SECRETARY TO GOVERNMENT

To

The Commissioner of Printing, Stationery & Stores Purchase,

Andhra Pradesh, Hyderabad

(with a request to publish the Gazette Notification and to furnish

1000 copies of the Gazette to the Government immediately).

Copy to:

The Director General of Police, Andhra Pradesh, Hyderabad

The Additional Director General of Police,

Crime Investigation Department, Andhra Pradesh, Hyderabad

The Law (E) Department.

The P.S. to Minister for Home.

SC/SF

//FORWARDED:BY ORDER//

SECTION OFFICER.

Previously the AP State Government has issued a similar G.O. banning the Advertisement in any media against Amway India Enterprises.  Sadly it has miserably failed to implement the G.O.  We hope the same situation won't recur in the case of Speak Asia too.

GOVERNMENT OF ANDHRA PRADESH

ABSTRACT

Investigation of case against M/s Amway India Enterprises – Issue of Notification under Section 8 of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978 – Orders- Issued

-------------------------------------------------------------------------------------------------------

HOME (GENERAL-B) DEPARTMENT

GO Ms No. 178                                                                                             Dated:15-09-2008

Read: Letter Rc. No.121/A2/2008, dated: 26-05-2008 of the Director General of Police, Andhra Pradesh, Hyderabad.

***

ORDER:

Whereas the Director General of Police, Andhra Pradesh, Hyderabad, in the reference read above has informed that investigation in the case of M/s. Amway India Enterprises has been finalized and charge sheet has been filed on 24-01-2008, in the Court of Hon’ble Chief Metropolitan Magistrate, Hyderabad, vide C.C.No.125/2008, and requested the Government, to issue Notification under Section 8 of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978, in the official Gazette declaring every copy of the News paper and every copy of the publication / websites containing such material or the advertisement connected with any prize chit or money circulation scheme promoted or conducted in contravention of the provisions of this Act or any advertisement or in relation thereto, to be forfeited to the Government of Andhra Pradesh.

2. And whereas, the Government have carefully examined the proposal of the Director General of Police, Andhra Pradesh, Hyderabad, and after careful consideration have decided to issue a Notification in the Official Gazette of Andhra Pradesh, to declare every copy of the News paper and every copy of the Publication / containing such material to be forfeited to the Government of Andhra Pradesh which is connected with the propagation or otherwise under the Prize Chits & Money Circulation Schemes (Banning) Act, 1978.

3. Accordingly the following notification shall be published in the next Extraordinary issue of the Andhra Pradesh Gazette.

NOTIFICATION

In exercise of the powers conferred under section 8 of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978 (Central Act No.43 of 1978), the Government of Andhra Pradesh hereby notifies that the “Amway India Enterprises” is hereby restrained from publishing any material / advertisements containing such material connected with any Prize Chit or Money Circulation Scheme, promoted or conducted in contravention of the provisions of the Act, and declare every copy of the News paper and every copy of the publication containing such material or the advertisement to be forfeited to the State Government of Andhra Pradesh

(BY ORDER AND IN THE NAME OF THE GOVERNOR OF ANDHRA PRADESH)

AJOYENDRA PYAL,

PRINCIPAL SECRETARY TO GOVERNMENT

To

The Commissioner of Printing, Stationery & Stores Purchase,

Andhra Pradesh, Hyderabad  (with a request to publish the Gazette Notification and to furnish 500 copies of the Gazette to the Government immediately)

Copy to:

The Director General of Police, Andhra Pradesh, Hyderabad

The Additional Director General of Police, CID, A.P, Hyderabad

The Law (E) Department

//FORWARDED::BY ORDER//

SECTION OFFICER

Speakasia accused in judicial custody

The Magistrate of Railway Court, the incharge court for Sunday duty, has sent the four accused in the speakasiaonline fraud to the judicial remand upto September 23.

CID DSP Mr YV Ramana Kumar said that the CID filed the petition for the custody of the accused for interrogation and to take forward the investigation. He said that the CID need to obtain information regarding the  over Rs. 2000 crore (Rs. 20 billion) fraud and yet to learn to more about the key persons responsible behind this massive fraud.

The senior police officer said that the speakasiaonline has collected several thousands of crores of rupees from the public with the inducement that they would get Rs. 52,000 in one year if they pay Rs. 11,000 as membership fee.

Corporate Frauds Watch President MR Ch Divakar Babu said that there are several multilevel marketing companies which have been cheating the gullible in the name of easy and quick money. 

CID arrests four key persons of speakasia

The State Crime Investigation Department (CID) on Friday arrested four persons in Mumbai for their alleged involvement in the speakasiaonline fraud. A CID team went to Mumbai on Thursday and picked up the accused --Ravi Khanna, Director Seamless Outsourcing, Sheikh Rayees, a technical officer who was dealing with speakasia website, Dipankar, distributor-cum-franchisee of the firm Kritanj Management and Allied Services, Raipur and Rahul Shah, vice-president of Tulsiyat Technologies Limited. All the arrested will be produced in court in Vijayawada on Sunday.

It may be recalled that Corporate Frauds Watch lodged a complaint with the CID against speakasiaonline stating that the fraudulent is indulging in money circulation scheme in the name of conducting surveys.

CID officials said that the money collected from the subscribers of speakasiaonline would be sent to Seamless and Tulsiyat companies which in turn would send the amount to speakasia's head office in Singapore. The role of Sheikh Rayees was to enroll subscribers, they said.

After producing the accused in the court, the CID may seek their custody to further interrogate the quartet about speakasia's operations. The CID has registered a case against the four under Section 120B and 420 of IPC and Section 4,5,6 of Prize Chits & Money Circulation Schemes (Banning) Act, 1978.

The speakasiaonline is accused of collecting Rs, 22.65 billion (Rs. 2265 crore) towards subscriptions fee by enrolling about 19 lakh people across the country, including Andhra Pradesh. The CID registered a case against the company in June this year. Speakasia started its business through its website without any authorisation from the Central government and made false promises to people. The company has already transferred over Rs. 6 billion to their personal accounts in Singapore.

The CID is ready to get the COO of the company Tarak Bajpai, arrested earlier by the Mumbai Police some time ago, to Vijayawada on a prisoner transit warrant. He is presently recuperating in a hospital after undergoing an operation.

The CID is likely to seek the help of Interpol to track down speakasia Chief Executive Officer Ms Harender Kaur who is said to be either in Singapore or Dubai.

The 'Speakasiaonline' lie is blown out of the water, but the 'MLM' lie sails on regardless

Shyam

Although the recent news about 'Speakasiaonline' is encouraging, it is almost a pointless exercise to deal with 'MLM income opportunity' fraud on a case by case basis.

I challenge any gang of 'MLM income opportunity' racketeers anywhere in the world, to prove that a significant number of their constantly-churning adherents has ever earned any net-income lawfully from regularly retailing products, and/or services, to the public for a profit.

No one is going to accept my challenge, for the simple reason that the overwhelming majority of so-called 'Independent MLM Business Owners' have abandoned their so-called 'businesses' within a short period, whilst a significant minority (usually with access to independent funds) have become de facto slaves, unconsciously dissipating all their mental, physical and financial resources to the benefit of hitherto unknown 'MLM' bosses, whom they have continued to trust and follow no matter what suffering this has entailed.

The evidence (in the form of the tax record) proves that, for the previous 50+ years, all so-called 'MLM income opportunities,' have been variations of essentially the same addictive lie. This reality-inverting, self-perpetuating fraud was conceived by a pathetic little gang of narcissistic parasites in the USA, where it has never been rigorously challenged in the criminal courts.  As a direct result of this chronic failure of US law enforcement, certain American 'MLM' bosses have managed to become some of the most influential and wealthy racketeers in history. Not surprisingly, they have spawned countless copy-cats, including the bosses of the Indian 'MLM' racket known as 'Speakasiaonline'. 

Whilst US law enforcement agents have continued to do effectively nothing, 'MLM income opportunity' fraud has become a global, organized criminal activity generating billions of illegal dollars and poisoning the lives of tens of millions of ill-informed individuals. A significant amount of this stolen cash has been used to infiltrate traditional culture, and particularly to co-opt academics and corrupt government. 

Had common-sense been applied years ago in the USA, then  'MLM income opportunity' fraud could have been fully-identified, and stamped out. Instead, we are now in a crazy situation where the phenomenon still remains largely-unrecognised, even though it should be ranked alongside the sale of narcotics as an ongoing menace to democracy and the rule of law.

Quite obviously, it is now not in the interests of senior US law enforcement agents and politicians to admit their own shameful role in this shameful affair.

David Brear (copyright 2011)

AP High Court dismisses writ petition of speakasiaonline

Justice Raja Elango of Andhra Pradesh High Court on Tuesday delivered the judgement which could herald a new path against the multilevel marketing, dismissing the writ petition filed by speakasiaonline appealing to stall investigation into its business model. Justice Raja Elango dismissed the writ petition and vacated the stay order issued by the High Court which restrained the arrest of the employees of speakasiaonline.

Now the CID police of Andhra Pradesh could go ahead with the arrest of the all the culprits responsible for the massive fraud involving about 20 billion rupees. So far, the police could freeze the assets worth about 5 billion rupees.

It appears the Andhra Pradesh High Court has taken into consideration the affidavit filed by Corporate Frauds Watch. However, the full judgement which would come out in a couple of days would reveal it all.

It could be safely said that it is a victory of Corporate Frauds Watch as its counsel Mr Mastan Vali was not even given an opportunity to present the argument. Whatever was presented in the affidavit submitted to the High Court as Respondent No.2, was more than sufficient for the High Court to arrive at the conclusion, it appears.

Ms Harender Kaur who went into hiding after the CID launched investigation may not appear in public in near future. And the gullible people who blindly believed their friends and relatives to the offer of 'good business opportunity', stand to lose their hard-earned money.

The case should become an eye-opener to the people all over world not to fall prey to the lure of easy and quick money.

What is the 'Speakasiaonline' counsel being paid to hide from the Indian public?

Shyam

It's no wonder that the counsel for the unoriginal 'MLM income opportunity' fraud known as 'Speakasiaonline,' doesn't want the well-informed attorney of Corporate Frauds Watch to be heard by the Andhra Pradesh High Court.

The 'Speakasiaonline' counsel (who must, at the very least, suspect that he is being paid with stolen money) made a remarkable admission of his client's guilt when he said that the 'MLM business model' of his client is 'very complicated and difficult to understand.' However, even though this ridiculous intellectual prostitute has shot himself in the foot, he wasn't telling the whole truth. Fortunately, the Judge seems to have already deduced that the counsel for 'Speakasiaonline' has been trying to blind the Andhra Pradesh High Court with meaningless mathematics, and no doubt he will rule that Corporate Frauds Watch is acting in defence of the people of the Republic of India, and that  Mr. Mastan Vali has every right to speak.

So what is it that the 'Speakasiaonline' counsel is being paid to hide from the Indian public?

In all so-called 'MLM business models,' to their victims and to casual observers, participation can at first appear to be reasonable and benefits achievable. However, when rigorously examined with common-sense, these so-called 'MLM business models'  gradually become evermore costly and mystifying; for they are all secretly based on the crackpot, economic pseudo-scientific theory that endless-chain recruitment + endless payments by the recruits = endless profits for all recruits who continue to believe in 'MLM' without question.  Ultimately, 'MLM' is completely incomprehensible and its claimed benefits are never quantifiable.

The complex and difficult to understand 'Speakasiaonline MLM business model' has been there only for one reason. Namely, to distract the victims and the authorities from the simple, common-sense explanation of 'MLM income opportunity' fraud:

No matter what impressive, thought-stopping, geometrically-expanding, mathematical formula is applied to illustrate and divide up the money flowing into an 'MLM income opportunity' fraud, the overwhelming majority of ill-informed participants can never hope to receive any overall net-income (no matter how high they climb in the so-called 'MLM business model'), because, since most of the money flowing into the fraud has not been derived from the participants retailing goods, and/or services, to the public for a profit, participants have actually been unwittingly peddled infinite shares in what can only be largely, or entirely, their own finite money.

So called 'MLM income opportunities' have all been latter-day copy-cats of an absurd mathematical hoax, the origins of which are lost in the mists of time.

Perhaps, Mr Mastan Vali should remind Justice Raja llango that, according to the traditional, Indian, moral fable, when the creator of the game of chess (an Indian mathematician, or a legendary figure named Sessa or Sissa) gave his invention to the delighted ruler of his country, he was granted the exceptional right to name his own reward. The inventor told the astonished King that all he required was one grain of wheat to be placed on the first square of his chess board, two grains on the second square, four on the third, eight on the fourth, etc. Without thinking, the King immediately accepted the inventor's (apparently modest and viable) request, and ordered his treasurer to hand over the wheat. However, when the treasurer took more than a week to calculate the quantity, the King, who had no knowledge of mathematics, asked him to explain the delay. The treasurer said that, in reality, there wasn't enough wheat in the entire land to give the inventor/mathematician even a fraction of his promised reward.

Realizing that the inventor/mathematician had tried to cheat him, the King ordered his head to be cut off to discourage any similar trickery in the future.

David Brear (copyright 2011)

AP High Court understood the business model of speakasiaonline

Justice Raja Elango of Andhra Pradesh High Court appears to be determined to grill speakasiaonline as he has already understood the dubious business model of the fraudulent company. The trial was adjourned today to 25th August, 2011 after the counsel of Corporate Frauds Watch, Mr Mastan Vali expressed no objection when the Government Pleader asked for the adjournment.

During the hearing on Friday last, the counsel for speakasiaonline stated that the business model of speakasiaonline is very complicated and very difficult to understand. However, Jutice Raja Elango in a sarcastic note wondered how he could understood that easily if it is that complicated and difficult to understand.

Immediately, The counsel for the petitioner changed the tack and started attacking the complainant, Corporate Frauds Watch and stated that it has no locus standi. The writ petition has gone to the extent of casting aspersions on Corporate Frauds Watch and stated that it was trying to be in limelight in filing such criminal cases against the petitioner company. At the end of that paragraph, the writ petition has also stated that Corporate Frauds Watch has been making unjust demands.

After hearing the petitioner counsel's argument, Justice Raja Ilango emphatically stated that he would look into the locus standi of Corporate Frauds Watch later and asked the counsel to put forward the argument justifying the business model of speakasiaonline.

In a helpless mood, the counsel for the petitioner asked for adjournment.

Now the trial is adjourned for 25th August, 2011, one has to wait and see what decision the Andhra Pradesh High Court takes. 

CID to seek custody of speakasiaonline COO Tarak Bajpai

CID of Andhra Pradesh is contemplating to seek custody of Mr Tarak Bajpai, the Chief Operating Officer of speakasiaonline to interrogate him. Mr Tarak was detained by Mumbai police on Friday at Indore, Madhya Pradesh for his role in the alleged money circulation scheme.
The CID has already found that speakasiaonline has a strong base in Andhra Pradesh with more than 30,000 members for its pyramid scheme.
Investigations led by Mr Jitender, Inspector General of Police of CID, revealed several European connections of the company in the scam. The fraudulent company has already siphoned out Rs. 461 crore from India and Rs. 8 crore alone to ActieIndex of Netherlands. According to the CID, most of the money was sent to Singapore where Ms Harender Kaur, CEO of the company lives. The CID has frozen Rs. 134 crore in the Bank accounts of speakasia in Mumbai after the case was booked.

speakasiaonline COO Tarak arrested

The Chief Operating Officer of speakasiaonline, Mr Tarak Bajpayi has been arrested on Thursday at Indore, Madhya Pradesh, India. The arrest shows that the investigation into the large scale fraud of speakasiaonline is going in right direction.

The police should also intensify the investigation and arrest more persons in this massive fraud. Corporate Frauds Watch is demanding the massive funds transferred from India by the fraudulent company should be repatriated immediately. It may be recalled that the speakasiaonline has already siphoned out several hundreds of millions from India to Singapore.

All these fraudulent companies encourage their members to recruit more and more members from their friends and relatives. Out of enthusiasm to earn more commission these members draw their own friends and relatives into the dragnet. The real problem surfaces once the chain breaks and people lose their money. They never trust their friends and relatives for causing financial loss to them. This mistrust seriously affects the social fabric of our society and it is more dangerous than losing money. No one trusts anyone.

My dear fellow humans all over world! Do not fall for the easy and quick money and lose your friends and relatives. 

The 'Speakasiaonline' lie, is only part of the 'MLM/Direct selling' Big Lie

Shyam

Peddling the Big Lie that 'MLM/Direct Selling (as it has been practised for 50+ years)' is an authentic 'income opportunity,' remains a largely-unrecognised, global criminogenic phenomenon. Yet again, the 'Speakasiaonline' version of this pernicious urban-myth, demonstrates why it is almost a complete waste of time and resources trying to deal with 'MLM/Direct Selling' racketeers on a case by case basis.  

I look forward to the day when a majority of judges, legislators, law enforcement agents and journalists around the world, finally wake up and face the brutal reality that each time one of these so-called 'MLM/Direct Selling' companies has been rigorously investigated by well-informed and honest persons who have applied a modicum of common sense, it has been discovered that effectively none of the so-called 'MLM/Direct Selling Company's' constantly-churning, non-salaried commission agents has ever received a net financial benefit from regularly, directly selling goods, and or services, to the public for a profit.

The fact that all around the world, countless, inflexible charlatan-bosses of these essentially-identical fake 'income opportunities' are still allowed to label their absurd criminal activities as 'MLM/Direct Selling,' has been a shameful reflection on the incapacity of a majority of judges, legislators, law enforcement agents and journalists to apply common sense and ignore anecdotal evidence, or to recognise that we've all been victims of the 'MLM/Direct Selling'  Big Lie and that the longer this lie has been allowed to survive: the bigger and more contagious it has become.

As we have often pointed out before on Corporate Frauds Watch, the weasel-faced 'Nazi' propaganda Minister, Joseph Goebbels, is supposed to have said: 

“If you tell a lie big enough and keep repeating it, people will eventually come to believe it. The lie can be maintained only for such time as the State can shield the people from the political, economic and or military consequences of the lie. It thus becomes vitally important for the State to use all of its powers to repress dissent, for the truth is the mortal enemy of the lie, and thus by extension, the truth is the greatest enemy of the State.” 

It is, therefore, rather appropriate that, although this is a perfect, concise explanation of how the 'Big Lie' works, there is no quantifiable evidence that Joseph Goebbels actually made this statement. Indeed, just a moment's thought reveals that Herr Goebbels (whose role was to stop people from thinking) is probably the last person to have made such a thought-provoking confession. 

David Brear (copyright 2011)