In February 2017, a cybercrime complaint was filed against the direct selling company under the criminal provisions of the Indian Penal Code and the Information Technology Act. However, the Karnataka Supreme Court dismissed the case on the grounds that the criminal law “is not even applicable to the circumstances of the case”. Qnet Ltd, formerly known as QuestNet, GoldQuest and QI Limited, is a Hong Kong-based multi-level marketing (MLM) company owned by QI Group. The company`s products include energy, weight management, nutrition, personal care, home care and fashion accessories, all on a single e-commerce platform. [2] The company operates in more than 30 countries and has offices in Indonesia, Malaysia, Hong Kong, Philippines, United Arab Emirates, Thailand, Taiwan, Vietnam, Saudi Arabia, Egypt, Ivory Coast and Rwanda with franchises in India. Singapore and Turkey. [37] [38] It has been mentioned by Egypt,[13] Rwanda,[39][40] and Sri Lanka[41][42][unreliable source?] [43] For alleged application of a product-based pyramid scheme. The company and its Vihaan franchise are under investigation in India. [44] The Mumbai High Court rejected the application of the directors of Vihaan Direct Selling Pvt Ltd., a Qnet franchise, which included amateur billiards world champion Michael Ferreira, after it was rejected by the Court of Sessions. They were charged with fraud and forgery. [45] The Court stated that “deception and fraud are disguised as electronic marketing and business.” [46] The Delhi Supreme Court also called it a multi-victim fraud and refused to overturn the FIR against the directors of Qnet`s Indian franchise, Vihaan Direct Selling Private Limited.
[47] The Serious Fraud Investigation Office, in its report on GoldQuest and QuestNet India, identified multi-level marketing (MLM) programs by foreign operators as a “potential threat to national security.” The Indian government has ordered the Serious Fraud Investigation Office to file a complaint against GoldQuest International and QuestNet Enterprise under the Companies Act and the Indian Penal Code. [48] [49] A brief summary of the IWSO report is now publicly available. [50] The company denied the allegations. [12] According to its website, QNET is a “global e-commerce-based direct selling company that provides unique, high-quality products and services to customers around the world, while giving them the opportunity to build a distribution business by promoting those products.” The company uses a multi-level marketing (MLM) model, where independent sales representatives sell their products and receive compensation based on their sales volume. QNET`s IR Protection Order remains in effect. Unfortunately, the authorities continue to flout Supreme Court orders. In 2020, another notice was sent to Cyberabad police. According to QNET, “the actions taken by the police have no civil and criminal compliance and are a direct disregard of the order of the Supreme Court of India which ordered all states, including the state of Telangana, not to take coercive measures against the company.” QNET continues to challenge these wrongful arrests. The company filed a complaint with Wikipedia administrators about the extreme bias of the information it contains and took other steps to have it corrected, such as opening a debate on the “Neutral View” bulletin board. From 2009 to 2012, Qnet was the official sponsor of the Asian Football Confederation during the AFC Champions League. [ref. needed] In 2010, the company partnered with Virgin Racing.
[24] Qnet received TRUSTe privacy certification in late 2012. [25] In 2013, Qnet announced plans to move its production facilities to India and open an office in Russia. [26] [27] The company`s QI Tower in Malaysia won the Building and Construction Authority`s (BCA) Green Mark Gold Award in 2013. In 2014, Qnet began a three-year partnership with Manchester City Football Club to become the club`s official direct distributor.[28] [29] The agreement was then expanded in 2017. [30] Vihaan clarified that it is a direct selling company and not a financial institution as the government claims. Vihaan`s legal representatives stated that the direct selling company does not accept deposits and therefore the provisions of the KPIDFE law cannot be used against them. In India, Qnet has been prosecuted and/or arrested in Kukatpally,[280] Cyberabad,[281][282][283][284][285][286][287][288] Bangalore,[289][290][291][292][293], Hyderabad,[294] Goa,[295] Rajasthan,[296] Telangana[297] and Powai. [298] Cyberabad police began investigating the suicide of a former technician for alleged losses he incurred after investing 25 Indian lakh rupees in the Qnet Ponzi scheme. However, the Supreme Court held that this model chosen by the company was not a system of money circulation and did not in fact fall within the scope of the Money Prices and Circulation (Prohibition) Act 1978.
They classified QNET and its franchisee Vihaan as a legitimate direct selling platform. QuestNet and GoldQuest, which nearly closed in 2009, came out bigger and stronger than QNET. But the hype and difficult selling of this MLM company to get people to register distributors and sell lifestyle products like watches, gold coins, biodiscs, herbal products, and travel packages is worrisome. Will it also follow the path of SpeakAsia, Stockguru and NMart while the regulators do nothing? In Moldova, a fraud case that had previously been closed has been reopened due to numerous complaints. [165] Hundreds of Moldovans who wanted to get rich overnight went bankrupt after being persuaded by friends and relatives to join Qnet. They were promised thousands of euros a week, but first they had to buy goods worth at least $2,000 from the company. The newcomers also had to convince two other people to buy $2,000 from Qnet in exchange for a $250 commission. [166] NEW DELHI, INDIA/ACCESSWIRE/April 26, 2017/ Whenever you hear about a multi-level marketing (MLM) or network marketing company these days, it seems like there`s a negative association associated with the idea. And yet, network marketing is simply a way for companies that produce goods to distribute them without necessarily owning and operating retail stores.
Independent agents (IRs) buy goods they sell, make profits and act effectively as their own bosses. In 2007, APLI, the Indonesian direct selling association, referred to GoldQuest as a Ponzi scheme. [78] Interpol arrested Eswaran and other company officials on fraud charges. [79] Qnet responded that the request was not well-founded. [80] After three weeks, Indonesian courts released Eswaran and dismissed the charges shortly thereafter. [12] Qnet continued to operate there. [81] Some countries have banned the sale of products through direct sales. Recently, the Kingdom of Oman in the Middle East announced that it would not allow network marketing, a form of direct selling, due to an increase in commercial scams caused by pyramid schemes exploited as part of network marketing. Similarly, in several emerging markets, the government is looking at the industry, as it is a new form of trade in most of these places.
Since QNET is a forerunner in the industry in these countries, especially in several African countries, the company is under scrutiny as authorities try to understand the business model. This process is by no means short and is often accompanied by media coverage, leading to bias against the industry and the company. Qnet was founded in Hong Kong in 1998 by Malaysian businessman Vijay Eswaran. Although Eswaran was born and raised in Malaysia, he completed his graduate studies in the UK, where he learned how marketing programs work on multiple levels.[10] .