ED arrests two in Rs 1,500 crore MLM scam
Hyderabad: Enforcement Directorate (ED) has arrested founders of Indus Viva multi-level marketing (MLM) pyramid scheme — CA Anzar and Abhilash Thomas — in connection with Rs 1,500-crore MLM scam. The duo was arrested under Prevention of Money Laundering Act (PMLA)- 2002. The ED has initiated investigation based on FIR registered by Gachibowli Police in Cyberabad. […]
Hyderabad: Enforcement Directorate (ED) has arrested founders of Indus Viva multi-level marketing (MLM) pyramid scheme — CA Anzar and Abhilash Thomas — in connection with Rs 1,500-crore MLM scam.
The duo was arrested under Prevention of Money Laundering Act (PMLA)- 2002. The ED has initiated investigation based on FIR registered by Gachibowli Police in Cyberabad.
A press release issued by ED said the company was into MLM scam with illegal pyramid structure and was working under the guise of direct selling business. The company engaged a large number of distributors and did rigorous marketing about commission schemes stating that there was a great opportunity of quick and easy money by becoming a member and then in turn making further enrollments under one’s downline in a binary manner.
In order to project their fraud pyramid scheme as a legitimate business, they introduced some products which were by their own admission valued at only 20 per cent of the sale revenue and in reality are completely worthless.
The membership fee paid by new clients was used to pay commission to old clients. By giving false promises and inducements, the company enrolled around 10 lakh members and collected around Rs 1,500 crore since its inception, the press release said.
During the investigation, it was noticed that Anzar and Thomas, both residents of Bengaluru, floated subsidiary companies in Indus Viva Group and diverted funds to these entities and also blatantly siphoned off the collected funds into their personal accounts.
The diverted funds were used to acquire properties and assets in the name of individuals and companies. The ED officials produced the two arrested persons before the PMLA special court in Rangareddy district after which the court remanded them to 14-day judicial custody till December 30.
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