The Indian Direct Selling Association (IDSA) has expressed concern that the drive against fraudulent multi-level marketing players in the State may also have targeted genuine players and those with no direct or indirect involvement.

The response of the IDSA, a self-regulatory body, comes in the wake of the latest episode involving police raids on the outlets of Amway India in the State.

PYRAMID SCHEMES

Ms Chavi Hemanth, Secretary-General, said that the IDSA had, in a different context, taken up the issue during interactions with authorities held here in recent times.

“We also received an assurance to the effect that genuine direct sellers could continue to operate within the existing legal framework,” Ms Hemanth said.

A mushrooming of fraudsters under the grab of direct selling but engaged in ‘pyramid' schemes with attractive returns without any money-back guarantee is not something confined to the State of Kerala alone.

All genuine direct selling IDSA member companies offer unique features like 100 per cent money back guarantee, low start-up costs and a commission payout based on product sales and not on recruitments. There is no inventory loading either.

STRICT ACTION

The IDSA is, however, dismayed at the action of the police against member companies and its direct sellers, Ms Hemanth said. It has been learnt that a number of innocent people have been remanded to police custody.

“We would cooperate with authorities in case of any complaint against member companies, and would not desist from proceeding against them if found guilty,” Mr Hemanth said.

“But at the same, we also request the authorities to follow protocol and not harass genuine people.

We once again appeal to authorities to please issue necessary directions to the law enforcement body to avoid such harassment of genuine companies”, she added.

18 MEMBERS

IDSA is an industry body representing 18 leading Indian and multinational direct selling companies.

Direct selling is a Rs 4,120-crore industry, according to an Ernst & Young assessment. The Indian Council for Research in International Economic Relations (Icrier) expects it to become a Rs 7,120-crore industry 2012-13.

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