Indusviva pyramid scheme executives arrested in India
Cyberabad police in India have arrested twenty-four people in connection to Indusviva, an Indian MLM company.
Two of those arrested are Indusviva CEOs, who were apprehended whilst staying ‘at a hotel at Madhapur’.
BehindMLM isn’t familiar with Indusviva but based on its still operational website, the company marketed a range of supplements.
Abhilash Thomas, one of the arrested CEOs, was an Amway distributor before launching Indusviva.
The Hindu reports;
Abhilash lived a lavish life and owned a villa in Bengaluru. He had several luxury cars.
Photos of Abhilash with
Kerala’s Finance Minister Thomas Isaac and billionaire businessman Mukesh Ambani and other celebrities in the country to lure gullible people to invest in their MLM business.
As per a report from the the Time of India, Indusviva affiliates paid Rs. 12,500 in membership fees (~$170 USD).
Commissions were paid on recruitment of new affiliates.
The company was paying Rs 500 as commission for each new member enrolled. (~$6.80 USD)
Telangana Today reports Indusviva affiliate membership fees topped out at Rs. 150,000 ($2049 USD). This is presumably where the real money was being made.
Continued purchase of Indusviva products was required to qualify for commissions.
Indusviva claims to have signed up around a million affiliates. Complaints were filed with authorities when the company stopped paying out.
Indian authorities have pegged Indusviva victim losses at Rs. 15 billion ($204 million USD).
The twenty-four arrested, including Abhilash, have been charged with violating India’s Prize Chits and Money Circulation Schemes (Banning) Act, Drugs and Magic Remedies Act and cheating under the Indian Penal Code.
Update 5th May 2021 – The New Indian Express report that “four key operatives” of Indusviva have been detained.
In March, Cyberabad police had arrested 24 persons, including the four who are now detained under PD Act.
I take it this means the four are still in custody. The status of the remaining twenty arrested is unknown at this time.
Update 22nd February 2022 – The Hyderabad Enforcement Directorate has
provisionally attached assets worth 66 crore of Indusviva Health Sciences Limited and its promoters in the 1,500 crore multi-level marketing scam.
The properties of IndusViva chairman CA Anzar and others were attached under the provisions of the Prevention of Money Laundering Act (PMLA).
Anzar and CEO Abhilash Thomas are current in judicial remand after being arrested by ED on December 15.
The above was reported by the Times of India on February 5th.
I wonder if Ankur Agarwal is on the list. He’s in India and has scammed millions from thousands of people across the world.
facebook.com/mlmquestionanswers
This is totally unfair, it’s 100% genuine products base. but India has problems to see progress.
Attaching 100% genuine products to a pyramid scheme doesn’t make it any less of a pyramid scheme.
Dunno about India but you certainly seem to have problems progressing past “iT’s NoT a PyRaMiD sChEmE, tHeRe’S pRoDuCtS!”
Best products based company in over all india. Many patients were cured and they are taking advantage of these products.
White labeled nutritional supplements attached to a pyramid scheme didn’t cure anybody of anything.
Stop peddling lies.
Again with the “products-based” nonsense. Attaching products to a pyramid scheme just makes it a products-based pyramid scheme. And everyone who’s involved in one seems to think “it can’t be a pyramid scheme because there are products.” That’s just BS.
The placebo effect is no substitute for rigorous double-blind third-party medical testing. You can’t cite any of those, so kindly shut up and go away.
It would be interesting to get some feedback/have a discussion on how a network marketing company with, let’s say a legitimate health, wellness, or weight loss product, would get around the “pay to play” situation…
for example, what would be the best way to trigger a commission if you enrolled a new distributor who purchased products when they enrolled.
Paying a “fast start” bonus to the enroller on that new distributor’s purchase is common in the industry, but opens up the “pay to play” situation.
How would you design or structure a fast start bonus in order to avoid charges of “pay to play?”
I haven’t given it a lot of thought, but the only things I can think of, and this is just off the top of my head, is either do a CAB (Customer Acquisition Bonus) and structure like MLM telcom’s did, or everyone joins as a customer, and once you enroll your first customer, you then transition to being an affiliate…
the problem I see is why would a new affiliate or someone joining as a customer first buy, say $500 or $1,000 worth of products?
Seems you’d have to have a low cost of entry, but that negates a big fast start bonus…
By having retail volume requirements company-wide.
That is what I was driving at with the CAB (customer acquisition bonus) approach….
For example, if you enrolled an affiliate who purchased say a $200 business builder package, and the company wanted to pay a 20% fast start ($40), in order for you to earn the $40, you would have to personally enroll x number of customers who each purchased a minimum x dollar amount of product.
In your opinion, would that work to trigger the $40 fast start payment and avoid the “pay to play” label?
The telcoms were able to say we were paying the $40 fast start on acquiring the x number of customers, as the value of a customer ordering products each month is worth much more to the company than the $40 fast start payment they were paying..
Just out of curiosity Oz, what do you think the minimum should be as far as number of customers or retail volume?
1 customer? 2 customers? $100 a month in personal customer volume?
Would you make a minimum a requirement to earn any commission or bonus or just particular types like fast start or binary?
Also, a binary plan is at somewhat of a disadvantage compared to a unilevel plan from a qualification perspective, as you have a full 30 days in a unilevel plan to qualify for income vs. a binary being a weekly pay type situation…
Be that as it may, just about every binary requires you to have one active personally enrolled distributor in your left team, and one personally enrolled active distributor in your right team in order to qualify for income…
What if you also had to have one active personally enrolled customer in your left team and one personally enrolled active customer in your right team in order to qualify, and the customer in order to be considered active had to purchase a minimum of say $50 worth of product from the company…
This way there is at least a 1:1 ratio of active distributors and active customers required… what do you think of something like that?
The FTC has stipulated that in an MLM program 51% of your income must come from retail sales. Retail sales being customers who are not part of the program in any form, but strictly buyers of products being offered. Otherwise it is a pyramid scheme.
It would be impossible to set a ratio of customers to affiliate sales due to the difference in the dollar amounts of products purchased by retail customers and affiliates per sale.
50% retail volume company-wide, best ensured by a mandatory 50% retail PV split against each affiliate’s own monthly spend.
Can be higher than 50% for those wanting to do more than the bare minimum.
You can’t just set get X retail customers because revenue can still be heavily skewed towards affiliate purchase then (defacto pyramid scheme).
Oz, would like to get your opinion as to whether or not you think I would be on the right track in my comments…
The FTC has stipulated that in an MLM program 51% of your income must come from retail sales.
Retail sales being customers who are not part of the program in any form, but strictly buyers of products being offered. Otherwise it is a pyramid scheme.
Actually, the FTC hasn’t! The 51% standard you are referring to was a stipulation they agreed to in the VEMMA case, and the 51% figure is something that VEMMA put on the table in order to get the FTC to sign off on their revised compensation plan-it is not an industry wide mandate.
Herbalife, as part of their settlement, has an even higher percentage than 51%!
Finally, it is not necessarily retail sales, it is sales to “end users,” which can include a reasonable amount of product purchases made by distributors for their personal use and/or resale to customers.
In regards to “internal consumption,” the FTC has made it quite clear that a large amount of internal consumption, does not in, and of itself, automatically make a program a pyramid scheme!
On #12?
Qualification time varies from company. If PV is the qualifier then that’s usually a monthly qualification for either unilevel or binary.
The two recruits is a binary starter but usually if there’s ranks involved even a unilevel requires recruitment to progress.
If you don’t recruit, how are you going to build your unilevel team to earn off (even to get started)?
I think customer placement in a binary team doesn’t matter (outside of balancing volume). Tying retail PV to commission qualification rank is effectively the same thing, minus placement.
Please don’t start this shit again. It’s retail. If you want to call them retail end-users that’s fine, but to balance out affiliate spend you need retail sales.
We went through this as you noted with Vemma and Herbalife.
https://behindmlm.com/companies/latest-ftc-guidance-to-mlm-industry-emphasizes-retail-sales/
https://behindmlm.com/mlm/ftc-mlm-companies-with-little-to-no-retail-activity-are-illegal/
Affiliates/distributors = retail “end users” is something scam apologists came up with pre Herbalife/Vemma settlements.
Vemma tried this very argument against the FTC and they rejected it.
Herbalife didn’t bother trying to defend their affiliates on autoship = retail wholesale customers bullshit.
If by large you mean more than 50% then yes it does.
If you mean large with respect to total amount, if it’s balanced with equal or more retail volume then no it doesn.t
For what it’s worth, here is what the FTC actually has to say:
ftc.gov/tips-advice/business-center/guidance/business-guidance-concerning-multi-level-marketing
I know exactly what the FTC has said with respect to retail sales. I’ve quoted them directly in those two linked articles.
Every FTC action after Vemma/Herbalife has been because of little to no retail sales.
Article updated with news of four arrested now detained.
Article updated with CEO arrest and identification of seizable assets.