these companies to the Reserve Bank of India.
However, other investigating agencies will also have the authority to get information from states governments and other agencies.
The MLMs do not fall under the direct jurisdiction of any regulator or department and hence is not effectively monitored. The ministries of finance and home and regulators including the RBI and Sebi have already conveyed that they don’t look into the matters concerning MLMs.
Earlier, in India, MLMs such as Pinnacle Education and Opportunity Ltd, Gurudev Travel Connection, City Limousine and Kanakdhara Gold have been probed for alleged frauds.
* After the case of alleged fraud by SpeakAsia Online, the government started the process of reining in companies which offered impossibly high returns in a short span
* An inter-ministerial committee suggested setting up of a central agency to oversee MLM schemes and proposed to filter and block websites above a certain number of subscribers
* Companies will not be allowed to run a scheme with a compensation plan in which the subscribers would have to enroll minimum number of subscribers to become entitled to monetary benefits