The Way To Connect With Direct Selling Industry

The Way To Connect With Direct Selling Industry

Proceedings for shutting down MLM company Vihaan Direct Selling initiated

The Registrar of Companies has conducted inspection into the accounts of the firm and have found various violations, fraudulent activities an intention to dupe investors.

Union Ministry of Corporate Affairs (MCA) has initiated proceedings for winding up the activities of Vihaan Direct Selling India Private Limited, the Indian franchise of Hongkong based MLM firm Qnet.

The ministry also issued Look out circulars against former world Billiards champion and Padma awardee Michael Fereira and eleven others who are associated with the company as directors and promoters.

Based on the cases registered by the Cyberabad police, the Registrar of Companies (ORC) has conducted inspection into the accounts of the firm and have found various violations and fraudulent activities with an intention to dupe investors.

Meanwhile, Cyberabad police appealed to the public not to join or make any further payments to Vihaan group or any firms operating MLM or ponzi schemes. “There are 38 cases and 70 persons associated with it are arrested in Cyberabad. There are cases in other parts of the country too. ROC has also found several violations during inspection of their account books,” Cyberbad police commissioner VC Sajjanar said.

Cyberabad police have already served notices to celebrities like Shahrukh Khan, Anil Kapoor, Boman Irani, Allu Sirish and several others in connection with their relation with Qnet and its franchises and they have sent their explanation through their advocates.

“They are being verified. Based on the outcome, the investigation will proceed,” said Sajjanar.

MCA also issued a public notice alerting the public about the activities of the group. “The Inspection report is uploaded on the website of the Department of consumer affairs for information of the general public with a view to make them aware so as to prevent any possible fraud by the company under the garb of direct selling and multi-level marketing (schemes),” it said in the notice.

The MCA has informed Cyberabad police that inspections were conducted by the ROC on the group under the provisions of the Companies Act. Prosecutions have been launched by the ROC and LOCs have been issued against 12 persons. The ROC has also filed a petition before the NCLT for winding up the company.

The Ministry also informed the victims that in the garb of direct selling and e-commerce businesses, the company has drained out more than Rs 20,000 crores out of India.

Inquiries further revealed that Qnet had been operating in India as Goldquest and Questnet, Pallava Resorts, but stopped activities after the intervention of regulatory agencies. The company also sold products to its members with a huge profit margin of 160 to 416 per cent. The balance sheet examination also revealed that the products sold by them are immaterial and they were running an illegal product-based pyramid scheme. Even while selling products, the company sold the same product to different persons on the same date with huge differences in price.

While a former techie Adapa Aravind associated with Qnet committed suicide allegedly incurring losses by investing in QNet, two more similar cases were reported at Chennai and Maharashtra, found Cyberabad police.

Qnet denies proceedings:

Meanwhile, Qnet in a release claimed that the Public Notice is premised on the purported report of the Registrar of Companies, Karnataka and it is fallacious and has been prepared without any merit basis and understanding of the business. “We have challenged the said report in the appropriate judicial forum.” it said.

The Registrar of Companies has no bearing to deal with the aspects of our compliance with the said Direct Selling Guidelines and therefore any comments in this respect are completely out of place and baseless.

Our distributors are not investors. “In fact, we have no investors in our business as alleged. We are fully legitimate and compliant as per Indian laws,” it said.


Share on facebook
Share on google
Share on twitter
Share on linkedin
Related Company

Recommended People

Related People

Related News

Register to MLMEYE
      Strength indicator

    Forgot Password

Share on facebook
Share on whatsapp
Share on google
Share on linkedin
Share on email
Share on twitter
Share on pinterest

You must be logged in to see people lisitng. You may also register for an account.

Edit Your Profile
Please login to update your profile!