The Central Consumer Protection Authority (CCPA) has issued notice to 17 direct selling companies after they were found violation of the regulations.

It added that 13 of the cases are under investigation, while it awaits replies from three entities. “The action aims to address concerns about deceptive and exploitative practices in the direct selling industry and ensure adherence to the regulatory framework designed to safeguard consumer interests,” it added.

In a statement, the CCPA said to ensure compliance with the applicable legal framework, notices have been issued to the 17 direct selling entities for alleged unfair trade practices, service deficiencies, and violations of the Consumer Protection (Direct Selling) Rules, 2021. It include Oriflame India, Vihaan Direct Selling (India) Pvt. Ltd. (a sub-franchise of QNet Group, Hong Kong), Triptales Pvt. Ltd, Oriens Global Marketing Pvt. Ltd., Zennesa Wellness Pvt. Ltd and Orgolife Solutions Pvt. Ltd, Juncture Marketing Pvt. Ltd., Wolte Marketing Pvt. Ltd and Preet Life Care Pvt. Ltd. Other companies include Enroots Horizon Pvt. Ltd., E biotorium network Pvt. Ltd., Meghdoot Marketing Pvt. Ltd., Suii Dhaaga Lifestyle Pvt. Ltd, Winmarg Business Pvt. Ltd, Ayusratna Natural Herbal Pvt. Ltd., Biothon Lifecare Pvt. Ltd and Okflip India Pvt. Ltd.

CCPA intensified focus on regulating direct selling activities and carefully examined the websites of these direct selling entities. It has alleged that these entities were found to be running pyramid schemes by charging large joining fees or investment, paying compensation for recruitment and no right of return or buy-back being offered. “Some fraudulent entities misuse the direct selling model to promote illegal pyramid or money circulation schemes. These entities often make unrealistic promises of high commissions, foreign trips, entrepreneurship, high returns and a wealthy future, contingent on recruiting others, which violates consumer trust and established laws, thereby exposing consumers to fraudulent pyramid and money circulation schemes,” it added.

“The Department of Consumer Affairs urges all direct selling entities to adhere strictly to the regulatory framework and prioritise consumer welfare in their operations. The Government remains steadfast in its mission to create a fair, transparent, and consumer-friendly market ecosystem,” it added.

CCPA has also advised consumers to stay vigilant and any suspected illegal activities or violations related to direct selling to the appropriate authorities.