Parameters Of Evaluation Of MLM Operations – Strategy India – Blog

Parameters Of Evaluation Of MLM Operations

To determine if an entity is conducting a money circulation scheme or genuine direct selling operation, we analyse the following parameters:

Compensation plan- (Multilevel) The prime concerns that a compensation plan can generate are in terms of:
1. Sustainability (Money Circulation Scheme -Mathematical viability of the commitments in the compensation plan).
2. Earning opportunity (A pyramid scheme is designed to benefit the early participants rather than those who join later. In addition, a high cost purchases at regular intervals is necessary to benefit from the downline organisation turnover).
Intention - Determining the intention (to deceive) is a subjective process that requires a thorough analysis of various factors. These factors include the information available in the public domain and the type of information provided to investors, independent contractors, prospects, customers, consumers, and the public in general. Additionally, factors such as marketing materials and official website content are considered.
Products / Service / Commitments - Perform a comprehensive analysis of the products or services an operation offers and the commitments it makes at various levels.
Adherence to relevant laws – Evaluation of an operation's adherence to various laws, including the Consumer Protection Act (2019), the Consumer Protection (Direct Selling) Rules 2021, the Consumer Protection (E-commerce) Rules (2020), and other related laws. This requires thoroughly analysing their modus operandi, and other relevant documents to ensure they follow the intended rules.

This list is the output of an early detection and warning system by the team of Strategy india.

In this process, the team detects various MLM operations (Indian and Foreign Origin) and collects information in the first few weeks of the MLM operations starting in India.

The collected information is analysed within ten days, followed by listing unviable MLM activities on this scam alert list.

This list contains names of unviable business operations that deploy the Multilevel marketing compensation plan/s and have a multilevel marketing organization structure, which may have been initiated by the promoters (including founders, stakeholders, and the founder agents/distributors) knowingly (with complete knowledge of implications) or unintentionally (copied without understanding the viability of commitments and impact). These operations commit to offer un-viable returns and/or display misleading information on their website / promotional material/s.

The activities listed here deploy a multilevel marketing compensation plan to compensate the participants/investors/agents/distributors / independent contractors arranged in a multilevel structure.

This list is not exhaustive but contains a fraction of thousands of fraudulent MLM activities in India.

This list includes activities focused on promoting intangible (Token) products that are of no use/cannot be used for the people paying for the same.

In case an operation does not display the compensation plan on its official website, the compensation plan is sourced from other website/s /Platforms where the operators or its agents/distributors/promoters / independent contractors /participants would have displayed/posted the same.

Data used for evaluation include:

Snapshots of the Web pages from their official websites with the date and time stamps,
Names of the directors,
Names of the Promoters/Top distributors,
Addresses,
Contact numbers,
Products / Services/offerings,
Compensation plan/s,
Bank details (including the data on wallets)
Pay-out modes
Franchisee addresses,
Server details,
IP addresses,
Name of the Software developers and support service providers,
Approximate turnover,
Area of operation,
Videos of various meetings,
Brochures and literature

The information is shared with Investigation/Law Enforcement agencies only if requested with valid reason/s using official email ids and other accurate contact details.