Hyderabad: The Cyberabad police claimed to have busted another multi-level marketing racket on Tuesday with the arrest of nine persons involved in the Rs 30-crore fraud, which reportedly affected about 40,000 persons.
Cyberabad Commissioner VC Sajjanar said the Economic Offences Wing (EOW) busted the racket that was being run by Pro Healthwayz International LLP from Mahboob Gunj in Malakpet. The arrested persons were Mohammed Rizwan Younus (23), CEO of the firm; Bhattu Saikonda Harshavardhan Raju (27), director; Mohd Ishaq (61), director and six others.
Four of the suspects previously worked with multi-level marketing companies in the country and as their earnings were low, they planned to start their own network in the city. Harshavardhan along with three others approached Ishaq, who along with his son Younus invested money in the company and started the business.
“The company charged Rs 4,000 for joining and members were asked to attend meetings regularly. Each member was to enroll two more members in the binary scheme and would get 25 per cent as commission on the joining fee,” Sajjanar said, adding that the racket involved special incentives and status/ranks for the members.
The company gave performance-based incentives such as royal income, holiday trips and house funds. “The company assured members that they can earn between Rs 90,000 and Rs 1.5 lakh a month under various schemes,” the CP said.
The suspects took the help of a software company to design a special web-based software. The police said they were further verifying the activities of the firm and that investigation was still on.