Category Archives: Uncategorized

The Andhra Pradesh High Court did NOT determine Amway India was an illegal money circulation scheme

In news out of the state of Andhra Pradesh in India today, Amway India CEO William Pickney has been arrested and taken in to custody for the second time following what can only be called frivilous and false allegations against the company. I’ll post some more on this but first I want to address a lie falsehood that is continually spread about past legal proceedings against Amway India. This lie was repeated in numerous newspapers today, and has done in the past as well. Here’s one example from today, reportedly from an Andhra Pradesh Police statement -

a division bench of the High Court held that the scheme of Amway is illegal Money Circulation Scheme and falls within the “mischief of definition of Money Circulation Scheme.

A little history is necessary to understand the situation here.

In 2006 Andhra Pradesh state police (CID) shut down Amway in that state claiming it violated India’s Prize Chits and Money Circulation Schemes (banning) Act.

 

Amway petitioned the High Court and an injunction was issued against the CID, allowing Amway to reopen. Amway then went further and asked the High Court to dismiss the CID case completely. The High Court rejected that request, stating -

if the allegations contained in the report of C.No.1474/C-27/CiD/2006 dated 24-9-2006 are taken on their face value they make out an offence punishable under the provisions of Sections 4, 5 and 6 of the Act.

The “allegations contained in the report” are the Andhra Pradesh Police’s claims about how Amway operates. The High Court simply said that if what the Police claim is true, then Amway is in violation of this act, so the case shouldn’t be dismissed and the allegations should be investigated. In August, 2007 the  Indian Supreme Court ordered the Police to complete their investigation within 6 months, so the case could proceed. After 7 years it still has not been completed.

Here are three key examples of some of these “allegations” -

“a person who joins as distributor is required to enroll six persons”

False. A person who joins Amway isn’t required to do anything.

“the money the person at the top of the group is supposed to get according to the scheme includes the money which the first member, pay either towards subscriptions (initial/renewal) or by selling products.”

False. Distributors don’t earn any income at all from subscriptions.

From renewal fees, Amway earns “easy/quick money sans any service to the distributors/ members.”

False. Amway provides significant services to distributors in exchange for membership fees. Furthermore, the “easy/quick money” part of the law in question is regarding promoting you can earn it by joining Amway. Not that it’s quick and easy for Amway itself. (note: these fees have since been removed in Amway India anyway)

I completely agree with the Andhra Pradesh High Court! If the allegations are correct then Amway may be in violation of Prize Chits and Money Circulation Schemes (banning) Act, so a full court hearing is a perfectly reasonable thing to have to establish whether the allegations are true or not, and it would be unreasonable for the High Court to intervene and simply dismiss the case before it had even started.

Nearly 7 years later this case has still not proceeded, and the Andhra Pradesh Police are outright lying wrong about what the High Court said.

Kerala (India) issues guidelines for direct selling firms such as Amway

As per my previous post Amway India has been having challenges in that country with some poorly worded laws and a lack of regulation for the direct selling industry. Amway is implementing some changes from November 1, including removing all joining fees. The changes were a response to the Indian state of Kerala issuing some guidelines for direct selling firms. This is a great step forward for the industry in India! The guidelines are a prelude to proper legislation, which will hopefully be implemented nationwide.

Definitions

1. Direct selling

Direct selling means marketing of consumer products/services directly to the consumers generally in their homes or homes of others, at their work place and other places away from the permanent retail locations, usually through explanation or demonstration of the products by a direct seller or by mail order sales.

2. Direct selling Entity

Direct selling Entity means a business entity which sells or markets products with its trademark or services mark or nay other identifying mark through a direct selling individual or organisation .

3. Direct seller

Direct seller means a person who is a member of a distribution system of the direct selling entity engaged in direct selling. Continue reading

Amway Australia and New Zealand launches a blog

Following on from the recent new Amway Europe blog, Amway Australia and New Zealand has now launched one as well, at http://amwayaustralia.wordpress.com/

The site author, Kevin Lowe, is currently in Grand Rapids following the Amway 50th celebrations and has a couple of videos up on the blog, including video of Australian Founders Crown Ambassadors Mitch & Deidre Sala.

UPDATE: Kevin’s now added a great video of Australian Founders Crown Ambassador Peter Cox, which I’ve embedded below

Doug Wead, Amway Adventure

I’m currently sitting on a hillside somewhere in Tuscany with a rather slow internet connection but thought it was worth a quick note to highlight a post on a (former) Amway Diamond’s blog – Doug Wead, Amway Adventure. He gives a personal example of the Amway Internet Echo Chamber effect and how falsehoods  spread by anti-Amway critics about his Amway experience have affected his reputation. I may do a further post on this when I’m back at my regular blogging desk in a couple of weeks.