What Is The IndusViva MLM Scam? Full Breakdown Of The Fraud

If you’re wondering how a company could possibly cheat millions out of billions, you’re in the right place. Why so? You may wonder. Because today we will uncover the story of IndusViva MLM scam! This scam shook the whole marketing industry by exposing the deceitful practice of multilevel marketing under the guise of legitimate business.

So, let’s go through the tale of promises unfulfilled, investments vanished, and a massive scheme that left a trail of devastation!

(A) IndusViva: An Innocent Exterior

IndusViva Health Sciences Pvt. Ltd, based in Bengaluru, touted itself as a direct-selling company specializing in advanced Ayurvedic health products. Their website described a range of offerings—iPulse, iCoffee, iGlow, and iSlim. Each product claimed to provide significant health benefits, from boosting energy and managing weight to improving skin health.

However, this healthy exterior was just a cover. The products were marketed as groundbreaking, but they were far from it. They lacked proper certification and government approval, casting doubt on their legitimacy. The real game was not in selling these products but in the recruitment-driven scheme that lay beneath the surface.

(B) The MLM Structure: A Pyramid in Disguise

You might have come across multi-level marketing (MLM) schemes that sound too good to be true—and often they are. IndusViva’s model seemed appealing on the surface. For an initial investment of Rs.12,500, you’d get a chance to join as a member, receive some products, and a user ID to start your journey.

But here’s the catch- the real money was in recruiting others!

The scheme promised you’d earn commissions by enrolling new members, who would each pay Rs.12,500. You were told you’d make more money by recruiting more people and encouraging them to do the same.

It was a classic pyramid setup– your earnings were primarily dependent on the number of people you brought in, not on the sale of actual products.

(C) The IndusViva MLM Scam Unfolds: Deceit and Fraud

The reality was far from what was promised. The company’s focus was not on product sales but on a continuous recruitment cycle. To truly grasp the scale of the scam, let’s take a closer look at how it operated-

(C.1) The Recruitment Frenzy

To become a member, you’d pay Rs.12,500 and receive some products, along with 100 points. Your primary task was to recruit others to join the scheme. Each new recruit also paid Rs.12,500, and you’d earn Rs.1,000 for each new enrollee.

The more people you brought in, the more you earned, creating a cycle that only worked as long as new recruits continued to join.

(C.2) The Promises and Rewards

IndusViva used an array of promises to lure in new members. They offered bonuses, luxury trips, and even cars for top performers. For instance, if you referred 4,000 members, you’d win a trip to South Africa. Refer 10,000, and a Mercedes Benz and a trip to the US were yours. These incentives sounded enticing, but they were designed to keep the recruitment machine churning.

(C.3) The Lack of Product Value

Despite the hype, the products sold by IndusViva had little to no real value. They were purportedly valued at only 20% of their selling price. None of them had proper certification or validation from any government authority. Essentially, the products were a facade to keep up the appearance of a legitimate business while the real focus was on getting more money from new recruits.

(D) The Crackdown: Law Enforcement Steps In

The scam finally came to light in early 2021. A complaint from an investor-led the Cyberabad police to investigate. They uncovered that IndusViva was running a massive money circulation scheme disguised as a legitimate MLM business.

On February 20, 2021, the police arrested 24 individuals, including CEO Abhilash Thomas and COO Prem Kumar. They were charged under sections of the IPC and the Prize Chits and Money Circulation Schemes (Banning) Act of 1978. The police froze the company’s accounts, which had around Rs.20 crore.

The Enforcement Directorate (ED) also got involved, investigating the financial aspects of the scam. They attached assets worth Rs.66.3 crore, including immovable properties and bank balances.

The ED’s probe revealed that the company’s founders, C.A. Anzar and Abhilash Thomas, had siphoned off funds to personal and subsidiary accounts, using the money to acquire properties and assets.

(E) The Fallout: Financial and Legal Repercussions

The financial impact of the scam was staggering. IndusViva had amassed around Rs.1,500 crore from approximately 10 lakh investors. The arrested executives were found to have used the diverted funds to acquire significant assets, including properties worth Rs. 50.47 crore and bank balances totaling Rs.15.83 crore.

The legal consequences were severe. The accused faced charges of criminal breach of trust and cheating. The court proceedings were set to determine the full extent of the fraud and ensure that those responsible were held accountable.

(F) Understanding the IndusViva MLM Scam: Key Takeaways

This scandal is a classic example of how MLM schemes can be misused for massive fraud. It highlights the importance of being cautious with investment opportunities that promise high returns with minimal effort.

Here’s what you should remember-

Beware of Pyramid Schemes: If a business model heavily relies on recruiting others rather than selling actual products, it’s likely a pyramid scheme.
Don’t fall into a quick money-earning trap: Over half of the victims of such MLM scams belong to the age group of 17-26 years who are desperate to become rich as soon as possible and looking for “work-from-home jobs”.
Verify Product Legitimacy: Ensure that any products you’re buying or selling are certified and approved by relevant authorities.
Investigate the Company: Before investing, research the company’s background and its business model. Look out for red flags like lack of transparency or exaggerated promises.

For more awareness, go through the following articles uncovering different types of scams-

(G) Final Thoughts

In a nutshell, the IndusViva MLM scam was a well-orchestrated deception that preyed on people’s hopes for quick financial gains. By masking a fraudulent pyramid scheme as a legitimate business opportunity, the company managed to defraud millions and create a financial mess.

As investigations continue, the focus remains on disclosing the full extent of the fraud and bringing those responsible to justice.

If you have been through any scams related to Multilevel Marketing, then feel free to share your thoughts in the comments section below!

Thanks for reading 🙂