Amway Vietnam under investigation
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Vietnam’s Ministry of Industry and Trade (MoIT) is investigating seven multi-level marketing companies, including Amway Vietnam.
With a focus on uncovering illegal pyramid schemes masquerading as business opportunities, the investigation is expected to be completed next month.
In late March, the MoIT assembled a team to look into Amway Vietnam, Unicity Marketing Vietnam, Thien Ngoc Minh Uy, Tap Doan Lien Ket Vietnam, Lien Ket Tri Thuc, Lien Minh Tieu Dung Thang Long and Nhuong Quyen Thang Long.
Amway Vietnam, Unicity Marketing Vietnam and Thien Ngoc Minh Uy have the largest revenues of multi-level marketing companies in Vietnam.
In the investigation team are representatives from MoIT’s Vietnam Competition Authority (the government’s management body for multi-level marketing businesses) and Market Management Department, which works in tandem with the Police Investigative Department on Economic and Corruption-related Crimes.
Since March 9, the Vietnam Competition Authority has revoked the registration certificates of five companies for fraudulent activities, and the Hanoi Department of Industry and Trade has punished several companies for violating regulations on multi-level marketing businesses in the capital city.
The investigations were launched after MoIT’s minister Vu Huy Hoang issued a directive requiring agencies to search out pyramid schemes falsely labelled as multi-level marketing companies.
In February, the Lien Kiet Viet company was caught after swindling about 60,000 people in more than 27 cities and provinces, appropriating a total of VND1.9 trillion ($87.15 million) since 2014.
Multi-level marketing firms were allowed into Vietnam at the request of foreign countries during Vietnam’s negotiations to join the World Trade Organization. Since 2009, foreign-owned companies have been permitted to run these businesses, and now nearly half of the 61 companies in this segment are wholly foreign-backed.
Questions & Answers
Q.Which government bodies are involved in the investigation of multi-level marketing companies in Vietnam?
Which government bodies are involved in the investigation of multi-level marketing companies in Vietnam?
Representatives from MoIT’s Vietnam Competition Authority and Market Management Department are part of the investigation team. The Market Management Department also collaborates with the Police Investigative Department on Economic and Corruption-related Crimes.
Q.What prompted the Ministry of Industry and Trade to launch these investigations into multi-level marketing firms?
What prompted the Ministry of Industry and Trade to launch these investigations into multi-level marketing firms?
The investigations began after MoIT’s minister, Vu Huy Hoang, issued a directive. This directive required agencies to actively seek out pyramid schemes that were misrepresenting themselves as legitimate multi-level marketing companies.
Q.When were foreign-owned multi-level marketing companies first permitted to operate in Vietnam?
When were foreign-owned multi-level marketing companies first permitted to operate in Vietnam?
Foreign-owned companies were first allowed to run these types of businesses in Vietnam since 2009. This permission followed multi-level marketing firms being allowed into Vietnam at the request of foreign countries during WTO negotiations.
Q.Which of the companies under investigation are the largest in terms of revenue within Vietnam's multi-level marketing sector?
Which of the companies under investigation are the largest in terms of revenue within Vietnam's multi-level marketing sector?
Amway Vietnam, Unicity Marketing Vietnam, and Thien Ngoc Minh Uy have been identified as having the largest revenues. These companies are among the seven multi-level marketing firms currently being investigated by the MoIT.
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