MLM News 2019: Malayalam News – MLM & Advocacy Network (MLM) & Advocacy Center of India (ACI)

MLM has become a global business and has the potential to be the most profitable business of the 21st century. 

 It has emerged from the ashes of the late Vedanta Group, a multinational conglomerate of over a hundred Indian conglomerates and businesses, and has become the most powerful business in the world with a market capitalisation of $15.5 trillion. 

The Lakshmi Lohia group of companies owns a market cap of $4.5 billion. 

There are a plethora of MLMs, which are companies that sell products and services that are not made in India and which do not have any local content. 

They include the Laguna Group, which operates a company Langlao, which makes surgical masks, which sell for $50-$100 in the US, and Mumbai Lokma, which sells medical medications, treatments and healthcare products at a market value of $200-$300 in India. 

For a country like India, where nearly 80% of the population is poor and the government has not made much of a dent in this sector, MLM is not only an attractive option but a vital one. 

But the growing fraud among MLMs is not the only issue facing the MLM industry. 

While the market for MLM products and the supply chain is one of the most important issues in the industry, the most serious problem facing the industry is the resurgence of fraud and mismanagement. 

“The scam is in the form of a series of transactions, that are not transparent and are often unnecessary to make money for MLMs. 

Some of the transactions, like the purchase of goods, are made by loyalists, others are made by ‘friends’ and some are not. 

Most of the frauds are done by insiders,” said Bharat Srivastava, a senior analyst at Acquisition Analytics. 

Bhaskar said the mismanagement of MLM funds is a major issue in India.

“We are seeing people getting out of their savings accounts and taking loans to invest in MLM companies.

This has led to inflated interest rates and poor investment returns. 

These people have not invested in MLMs at the proper rate,” Bhaskar told Business Standard. 

Lack of awareness of fraud is another major issue. 

Many MLM companys have not provided accounting and financial documentation to their customers, and many MLM companies have not provided accountants to their customers to verify the financial standards they have adhered to. 

In a statement, the National Consumers Forum (NCF), an advocacy group, said MLM businesses have a history of failing to adequately inform consumers about the fiat and the corporate standard of their products. 

On March 18, the National Consumer Forum filed a complaint with the Securities and Exchange Board of India seeking criminal charges against Aadhaar-enabled company Lendl, a small Loan Company that sold Lampu, an online MLM that sold $150-200 worth of products including toothpaste, shampoo, conditioner and sauna products. 

Also read: The Rise of Criminal MLM Companies

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