Kalpetta/Hyderabad: A court in Kerala on Tuesday granted conditional bail to direct selling firm Amway's India Chairman William S Pinckney, an American national, and two company Directors even as Andhra Pradesh Police cautioned the public not to join the company's activities terming its business illegal.
A day after he had remanded Pinckney and Directors Sanjay Malhotra and Anshu Budhraja to 10-day rpt 10-day judicial remand, Kalpetta Judicial first Class Magistrate N Ravishankar granted them bail with conditions including that the accused should report to the investigating official as and when directed.
Pinckney, Malhotra and Budhraja were arrested by the Wayanad Crime Branch (Economic Offences) wing from Kozhikode yesterday in connection with three fraud cases registered in Wayanad district.
They were booked under the Prize Chits and Money Circulation Schemes (Banning) Act based on complaints filed by distributors in 2011. The arrest was based on complaints filed in the Meppady police station by distributors Ashraf and Jaffer from Rippon and another distributor Hariharan from Vaduvanchal, Ambalavayal, Wayanad.
The complainants accused the company of its failure in ensuring the promised benefits to those who joined the network marketing business. They alleged the company had forced them to buy Amway products for huge sums of money.
Last year, the Crime Branch (Economic Offences wing) had conducted searches at Amway offices across the state including Thrissur, Kozhikode and Kannur districts as part of its crackdown on money chain activities.
The company's godowns in these centres were also closed and goods seized. The trio were booked under the Prize Chits and Money Circulation Schemes (Banning) Act based on complaints filed by two persons in 2011.
Amway, for its part, said it was cooperating with the investigations of the Kerala Police CB-CID further to the complaint filed in 2012 and Pinckney, Budhraja and Sanjay Malhotra have always been present to answer any queries of the police.
"With respect to the Wayanad case of 2011 for which it is believed that arrest warrants have been issued, the company or its officials have not been issued any summons to join the investigation nor was any information sought.

Andhra Pradesh CID's Additional Director General T Krishna Prasad said the activities of Amway India Enterprises Pvt Ltd are covered under Money Circulation and are in "clear violation" of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978.
He said the AP government had issued a Government Order restraining publishing of any material/advertisements of the Amway India, which was subsequently upheld by the AP High Court and later by the Supreme Court.
"The Amway India Enterprises Private Limited has been promoting Amway Products through Money circulation by conducting membership drive, cheating the public by luring and enticing them with incentives and commissions", the CID official said in a statement.
"The public is cautioned not to participate or join the Amway India Enterprises Pvt Ltd or any of its kind as the business is illegal and the government vide its GO Ms No 178, has banned even advertisements of Amway products," Krishna Prasad said.
Pinckney, who is an accused in the CID AP case against Amway in Crime No 129/2011 U/s 420 IPC and Section 2 (C) R/w 3, 4, 5 & 6 of Prize Chits and Money Circulation Schemes (Banning) Act, 1978, is also attending the court of Chief Metropolitan Magistrate at Nampally, in the trial against Amway, the statement further said.

There are several cases already registered in Andhra Pradesh against the company, the statement added. Amway in a statement said it is "seriously aggrieved and shocked at the sudden and unwarranted act of detention of its officials, especially when they were fully cooperating in investigations, responsive to queries and documentation requests of the Police Authorities."
"What can best be described as a routine consumer redressal issue or a complaint, has been misinterpreted and booked under the Prize Chits and Money Circulation Schemes (Banning) Act 1978 (PCMCS). This has repeatedly been a challenge not only in Kerala but elsewhere across India for the direct selling industry,” the Amway statement said.
Terming the incident as a "rash" action, Amway said the direct selling industry has been repeatedly seeking an amendment to the PCMCS Act. Direct selling is a business model involving the sale of products – there are no deposits or promised financial returns, which was at the heart of the PCMCS Act, it added.


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