New Delhi: Amway India on Tuesday called the arrest of its MD and CEO William Scott Pinckney an “unwarranted act” on “frivolous” charges that gave “a misleading impression” about its business.
Condemning the arrest, apex industry chamber Ficci said that it might have an adverse impact on India-US business relationships.
Mr Pinckney was arrested by Andhra Pradesh police on Monday in connection with a criminal case registered against the direct selling company.
“We are aggrieved and shocked at the sudden and unwarranted act of detention of our official. The case against which the action has been taken was filed in December 2013. The company had no prior information on the same,” said Amway in a statement.
The company said that as a law abiding corporate, it has always co-operated in such investigations, and has been responsive to the queries and documentation. Amway said that it has furnished all information and documents sought by the police officials.
“Due to the lack of a legal framework for the direct selling industry, any case filed is being misinterpreted and booked under the Prize Chits and Money Circulation Schemes (Banning) Act 1978 (PCMCS), which is otherwise intended to regulate financial schemes,” said Amway.
The direct selling industry has been repeatedly seeking an amendment to the PCMCS Act and has been working along with various industry bodies and government for the same, it added.
Amway said that it is a legitimate direct selling FMCG organisation operating in the country since 1998, selling more than 140 quality products.
“We have been compliant with all laid down guidelines of the governments. We have also made an investment of more than a $100 million in a manufacturing facility,” said the company.
Amway said that it operates its business through the direct selling model in markets with stringent direct selling and consumer protection regulations including the USA, the UK, China, Malaysia, Singapore and Vietnam.
“Ficci is aggrieved and shocked at the sudden arrest of Mr Pinckney. This move has been initiated by a consumer complaint and could have been easily addressed as a consumer redressal,” said Ficci in a statement.
The chamber urged the government to take note of the challenges faced by direct selling industry in India and give clarity to facilitate a clear distinction between the fly by night operators and legitimate business runners.
