Amway Faces Legal Action In ₹ 4,050 Crore Alleged Money Laundering Case

Hyderabad: 

The Directorate of Enforcement (ED) has filed a prosecution complaint under the Prevention of Money Laundering Act (PMLA), 2002 against Amway India Enterprise Pvt. Ltd. (Amway). The complaint has been filed in the Court of the Hon’ble Metropolitan Sessions Judge cum Special Court (PMLA) in Hyderabad, which took cognizance of the matter on the same day.

The ED’s investigation stems from various FIRs registered by the Telangana Police against Amway and its Directors under different sections of the Indian Penal Code.

The allegations suggest that Amway engaged in promoting an illegal ‘Money Circulation Scheme’ under the guise of selling goods, deceiving the public by promising high commissions and incentives through simple enrolment of new members.

According to the ED’s findings, Amway has been operating a Pyramid scheme masquerading as direct selling. Instead of focusing on the direct sale of goods to end consumers, Amway introduced a multi-level marketing scheme with numerous intermediaries in the form of distributors.

The scheme’s survival relies heavily on enrolling new members, with commissions and incentives increasing for those higher up in the hierarchy.

The ED contends that Amway’s activities constitute a Multi-Level Marketing Scheme and Money Circulation Scheme, leading to the generation of proceeds of crime amounting to ₹ 4050.21 Crore through the scheduled offence of cheating.