eBiz.com MD held for cheating public of Rs 5,000 crore

August 20th, 2019

Hyderabad : The Cyberabad police have arrested eBiz.com managing director Pawan Malhan and his son Hitikh Malhan on Tuesday for allegedly operating a Multi-Level Marketing (MLM) company. The company is said to have cheated the public to the tune of Rs 5,000 crore and the police are initiating steps to freeze Rs 389 crore in bank accounts of eBiz.com.

According to Cyberabad police, eBiz.com Pvt Ltd was into a money circulation scheme after being established in 2001 in Noida in UP. The company got 17 lakh representatives as its members. It mainly lured students and unemployed youth as members by promising huge profits. “The eBiz business model is a simple pyramid scheme in which the members who join in the initial stage earn huge money by making new members join the scheme. However, those who join in the later stages get low profits or no profits and ended up being duped,” Cyberabad Commissioner VC Sajjanar said.

A member has to join the scheme by paying Rs.16,821 so that he gets 10,000 points and subsequently he should join three more members. For six members, he will get 30,000 points and Rs. 2,700 as commission and for joining 50 members in the schemes he would get a higher commission. There were several schemes like First Orbit Group Incentive Plan and Second Orbit Onwards Group Incentive Plan. The hierarchy of the eBiz representative was began from silver and went onto silver ambassador, gold ambassador, diamond ambassador and so on.

The scheme, police said, was rampant in cities including Hyderabad, Bengaluru, Chennai and across Jammu and Kashmir, Delhi, Uttar Pradesh, Maharashtra, Karnataka, Tamil Nadu and Goa.

The Cyberabad police appealed people not to fall prey to money circulation schemes promoted in the name of multilevel marketing, network marketing, referral marketing, chain marketing or direct selling. These kinds of schemes were banned under provisions of the Prizes Chits and Money Circulation Schemes (Banning) Act 1978. (NSS)