Jump to content

Qnet

Page semi-protected
From Wikipedia, the free encyclopedia

This is an old revision of this page, as edited by Peterjmikhail (talk | contribs) at 19:11, 24 September 2013 (→‎Controversies). The present address (URL) is a permanent link to this revision, which may differ significantly from the current revision.

QNET
Company typewholly owned subsidiary
IndustryConsumer goods
FoundedHong Kong, 1998
FounderVijay Eswaran
Websitewww.qnet.net

QNet ltd, or QuestNet or GoldQuest or Qi limited, is a Hong Kong based direct selling company owned by the QI Group. The company sells a variety of products including Energy, Weight Management, Nutrition, Personal Care, Home Care, Luxury and Collectibles, Fashion Accessories.[1] QNet was founded in Hong Kong by Dato' Vijay Eswaran in 1998.

The company's marketing strategy follows a multi-level marketing model, depending on independent representatives to refer its products to consumers and receive compensation based on the sales volume of their referrals and the sales volume of other independent representatives in their teams who are arranged in a binary fashion.

QNet is a member in the Direct Selling Association of Malaysia, Philippines and Singapore.[2][3][4] It has offices in some Asian countries such as Indonesia, Philippines, United Arab Emirates, Thailand and Taiwan and franchise companies in India and Turkey and it also operates or has operated in other countries such as Saudi Arabia, Egypt and Côte d'Ivoire.[5]

History

QNet is the main subsidiary of the QI Group and was founded in Hong Kong by Dato' Vijay Eswaran in 1998. It was initially known as GoldQuest and made numismatic coins.[6] In 2003, the company re-branded to Quest-Net and expanded their product selection to include consumer products. In 2010, the name of the company was shortened to QNet.[7]

The QI Group established Quest Investment International, which then started producing watches and jewellery under the brand name Bernhard H. Mayer.[6] In 2007, the QI Group acquired Down To Earth (DTE), a vegetarian organic health store chain in Hawaii.[8][9]

Business model

A typical MLM binary tree structure. The blue individual will receive compensation from the sales of the downline red members.

The company's marketing strategy is based on a multi-level marketing model which depends on a group of independent representatives who refer its products to consumers and receive compensation based on the sales volume of their referrals and the sales volume of other independent representatives in their teams who are arranged in a binary fashion.[10]

QNet's business model has been described as a simple pyramid scheme, where initial entrants to the scheme do make money, but as the number of Independent Representatives (IR) increases, finding more IR's becomes harder and harder, until those that join late are unable to recover even their initial outlay and the model collapses.[11][12] QNet's Public Relations manager counters this explanation as offering a business opportunity that doesn't have the high cost of start up as a limiting factor. When an IR recommends the product the customer makes a purchase through QNets online system and the IR receives a commission based upon QNets compensation plan.[10]

The compensation plan operates by the recruitment of customers by existing Independent Representatives (IR). An IR is provided with an ID that gives access to a 'Tracking Centre' (TC) in its computer system through which the IR's sales are tracked. A TC has a left and right customer group. Every customer owns a TC which is then placed on the left or right customer side of the IR's TC. A 'direct' transaction (a customer's personal reference or sale) is counted as one transaction. An 'indirect transaction (someone in the cusomer's TC buys/refers/sells) is also counted as 1 transaction. the company pays $250 each time 3 product sales on an IR's left customer group are matched by 3 product sales on the right.[13][unreliable source?]

RYTHM foundation -derived from the acronym 'Raise Yourself To Help Mankind'- is a charity organization created by QI Group.[7]

QNet is a member of the direct selling association of Malaysia, and the direct selling association of Singapore.[3][4] In 2007, APLI, the direct selling Association of Indonesia, considered GoldQuest or QuestNet a pyramid scheme.[14]

Products

Under the names GoldQuest and QuestNet the company primarily sold gold collectible coins as an investment item.[15]

Currently, QNet mainly markets products made by other subsidiary companies of QI Group. The products are in travel packages, nutrition, personal care, home care, collectibles, fashion accessories and education.[16]

One of the products being marketed by the company is the Amezcua Bio Disc (also spelled BioDisc and BioDisk) which the company claims can "redefine and harmonise the energy of water, greatly maximising its positive affect on the human body".[17] These and other detailed claims of often miraculous properties have been widely denounced as fraudulent by various scientists, media commentators and watchdog organisations.[18][19] Critics have noted that the claims are based on thoroughly debunked pseudoscientific concepts such as hexagonal water and that they have never been validated by a peer-reviewed process. QNet has stated in a document published to its representatives that there are no known test and approval bodies to date on such products.[20]

Controversies

QNET has received a Fatwā by Dar al-Ifta that its business is not halal within Islamic law on the basis that it could harm the Egyptian economy.[21][22] The company has also been accused of operating a product-based pyramid scheme. The governments of India, Iran Indonesia, Nepal, Rwanda, Saudi Arabia, Sri Lanka, The Sudan, Syria, and Turkey have at various points shutdown local offices of the company, arrested key members involved with the company, or preemptively banned the company from entering.[23][24][25][26][27][28][29]

Donald Frazier, a writer for Forbes who focuses on Asian businesses, asserts that the charges against Qnet "tend to originate in apocryphal, anonymous or debunked sources".[30]

The company's executive director, Vijay Eswaran, has faced arrest for fraud on an Interpol warrant in May 2007.[31] On 4 December 2002, Cameron Thompson, member of the Australian Parliament, identified GoldQuest as an example of pyramid schemes according to a list prepared by The Office of Consumer and Business Affairs in South Australia during his speech in support of the government's proposal to amend the Trade Practices act(1974). The list contained 60 other companies that was thought to be proposed in an effort to con consumers in Australia.[29][better source needed] The Iranian government banned GoldQuest after what is believed to have been one the largest economic corruption cases in the country's history. Prosecutors found that the pyramid schemes of GoldQuest led to removal of around USD 500 million from the country.[25]

Approximately 3000 people, primarily young men, marched on the presidential palace in Kabul after the government temporarily withdrew QuestNet's license to operate. The business started in Afghanistan with around 600 IRs in 2006 and had expanded to 21,000 when the government temporarily withdrew the license to enable it to write operating laws.[32]

On September 4, 2009 the Rwandan Government's Ministry of Finance issued a statement banning QuestNet from operating in Rwanda due to violations of company and tax laws. The directive followed a declaration day before by the National Bank of Rwanda describing QuestNet as a shadowy pyramid scheme which "is collecting money from subscribers in Rwanda and sending it outside to companies called Park King Development and DBS Hong Kong using swift transfer."[33] Citing article 4 of the companies act and articles 9 and 10 of the tax act, Minister James Musoni issued the order forcing Questnet and its IRs to immediately stop all activities.[34] The company said in 2010 that "the activities of the 'IRs' had been suspended" and that it was getting the suspension lifted. In the same letter, responding to an article critical of its activities in Burkina Faso, it said it was not banned in any country.[35] In 2012 the ban was lifted following a letter from the Minister of Finance and Economic Planning, John Rwangombwa, addressed to the company stating “Upon review of your request to lift the ban on your business, and after consultations with different stakeholders, we hereby lift the ban and allow your company to resume operations as long as you abide with the conditions”.[36]

Questnet opened in Turkey in 2010 with about 150 people participating; 80 of them were later detained while police investigated them. From that investigation 42 people were charged with gaining an unfair advantage.[37] In April 2011, the Industry and Trade Ministry announced they were investigating QNet when the ministry received complaints that it was a rebrand of Questnet operating under the same circumstances. The Ministry also revealed that Quest was fined a TL3.64 million(USD 1.9 million) for its illegal activities in 2010.[38]

In 2009 people protested to The Sudan government until QuestNet was banned. The main complaints were about receiving very cheap products in exchange for money sent to the company or even not receiving anything at all. Cheap products like copper necklaces sold as gold and non-working mobile phone service, supposed to be connected to satellite.[39][40] Even after the company was shut down, another agent wanted to renew the contract of QuestNet in the Sudan, but the government refused stating that it wouldn't renew the contract of such company after a Fatwa had been issued to ban dealing with it and especially when watching other countries suffer from it. The government in Sri Lanka had suffered a loss of more than 15 million dollars out of the country which led the Sri Lankan government to issue a punishment of 3 year in jail for anyone caught in promoting or dealing with that company.[41][42]

The Syrian ministry of economics has ordered shutting down QuestNet's office in Syria in April 2009, after one year of operation, for the reason of violating the commercial registration granted to it.[43] According to statements of the Director of facilitation and trade efficiency in the Syrian Ministry of Economy, Ramzy Asawda, QuestNet has been performing a pyramid scheme in Syria and it has withdrawn a "terrifying" amount of money out of the country, estimated to be Billions of Syrian pounds, while paying a relatively little amount of taxes in return. Asawda also states that there can't be another office of the same company in Syria and if there are some people who are still working for this company, then they are performing an illegal action.[44]

The Home minister of Nepal banned GoldQuest in February, 2003, accusing it of being a pyramid scheme that was not registered with the Nepali government. Krishna Bahadur Manandhar, chief of the foreign exchange department at the Nepal Rastra Bank, stated that the Hong Kong-based company, GoldQuest, is "a hundred percent fraud", explaining the reason the NRB was not able to take action earlier is that there were no written records or agreements of any of the company's transactions.[45]

The Ministry Of Commerce and Industry of Saudi Arabia banned Qnet at the end of August, 2012, accusing it of stealing and falsification as well as not being registered with the ministry.[46] Furthermore, a message was published on the official website of the Saudi Arabian Ministry of Commerce and Industry warning the Saudi Arabian people not to be involved in such schemes under any pressure of false promises, mentioning the company name "QNet" specifically as one on those fraudulent schemes operating in the country.[47]

In India, May 2007 The International Herald Tribune reported Vijay Eswaran's, the founder of the company, arrest on an Interpol warrant.[48] A dispute in Manila, Philippines filed by two former partners of the original founding team was escalated to an alleged ‘offence’ leading to an Interpol Red alert listing of four directors. These included the two main founders, Vijay Eswaran, who was then Group Managing Director and Joseph ‘Japa’ Bismark, Founding Director. The case was fought out substantially in the courts of Manila and Jakarta. After spending three weeks in jail, Indonesian courts released him; a Manila court dismissed the charge soon afterward.[49] Back again in August 2013, The economic offences wing, (EOW), made the first arrest in the QNet case, members of the company (IRs) were arrested for cheating and was remanded into police custody till August 22. EOW was probing a suspected fraud committed by the firm. Two teams were sent to Bangalore and Chennai for investigations into this case. The police suspects arrested members to be linked to Vijay Eswaran, which is considered the prime accused in QNet case.[50] . the case goes on and Cops freeze 6 bank accounts of marketing firm in the same month and arrested member has been sent to judicial custody.[51]

See also

References

  1. ^ "All Products". QNet. Retrieved 17 December 2011.
  2. ^ "Direct Selling Association of the Philippines - Directory". Direct Selling Association of the Philippines. Retrieved July 21, 2013.
  3. ^ a b "Members List". Direct Selling Association of Malaysia. Retrieved November 12, 2011.
  4. ^ a b "List Of All Members". Dsas.org.sg. Retrieved November 12, 2011.
  5. ^ "Worldwide Offices". Qnet. Retrieved December 16, 2011.
  6. ^ a b "GoldQuest". Quest International Holding. Retrieved April 11, 2012.
  7. ^ a b "About". Qnet. Qnet. Retrieved 20 December 2011.
  8. ^ "Organic Health Food Supermarket Chain". QI. Retrieved August 11, 2012.
  9. ^ "Organic and Natural". Down to Earth. Retrieved October 13, 2012.
  10. ^ a b "Direct selling - How does it work". Qnet. Retrieved 18 April 2013.
  11. ^ Faso, Brukina (04-05-2010). "QuestNet pyramid scheme drops anchor in Africa". France 24. Retrieved 20 December 2011. {{cite news}}: Check date values in: |date= (help)
  12. ^ Rabie, Passant (10 August 2011). "Caught in a Pyramid Scheme". Business Today Egypt. Retrieved 18 April 2013.
  13. ^ "Frauds and Scams Introduction - Crimes of Persuasion – A Resource for Investigators". Retrieved 2011-11-12.. {{cite web}}: Check date values in: |accessdate= (help)
  14. ^ "Kewaspadaan terhadap Bahaya Money Game Meningkat". Asosiasi Penjualan Langsung Indonesia. Retrieved September 9, 2013.
  15. ^ Sucheta Dalal; Yogesh Sapkale (15 November 2012). "QNet, the MLM has resurfaced in India; will people be duped again?". MoneyLife. Retrieved 18 April 2013.
  16. ^ "Products for Life". QNet. Retrieved May 6, 2013.
  17. ^ "Bio Disc 2 (product description)". QNet. Retrieved 11 November 2011.
  18. ^ "BIO DISC SUMMARY" (PDF). Africa Center for Apologetics Research. Retrieved 11 November 2011.
  19. ^ Fulcher, Ben (April 2008). "Feature Article: Scalar Energy" (PDF). Jeremy (newsletter of the University of Sydney Physics Society). Retrieved 11 November 2011.
  20. ^ "FAQ - Amezuca Bio Disc" (PDF). QNet. Retrieved November 11, 2012.
  21. ^ "Al Azhar Fatwa" (in Arabic). DAR-Alifta. Retrieved December 14, 2012.
  22. ^ El Hariri, Nora (22 February 2012). "QNet: Making Your Own Decision". Business Today Egypt. Retrieved 18 April 2013.
  23. ^ Gahamanyi, John (3 August 2009). "Rwanda: QuestNet Banned". AllAfrica. Retrieved 25 April 2013.
  24. ^ Ir. Widarto Wirawan (April 2007). "Money Game Marak Lagi!". Bulletin of the Direct Selling Association of Indonesia (in Indonesian). Asosiasi Penjualan Langsung Indonesia (Direct Selling Association of Indonesia). Retrieved 16 November 2012.
  25. ^ a b "Iran busts more pyramid scammers". PressTV. Retrieved November 12, 2011.
  26. ^ Ramakrishnan, Sathyalaya (20 February 2010). "Multi-crore Gold Quest scam case SC hearing on February 26". Asian Tribune. Retrieved 25 April 2013.
  27. ^ "Quest for more gold: gullible public fall prey again". WebIndia123. 3 May 2008. Retrieved 25 April 2013.
  28. ^ "SriLanka banned Gold Quest long time ago". Muthamil.com. Retrieved November 12, 2011.
  29. ^ a b "TRADE PRACTICES AMENDMENT BILL (NO. 1) 2002 Second Reading". Retrieved 9 November 2011. Cite error: The named reference "prlinf" was defined multiple times with different content (see the help page).
  30. ^ Donald Frazier. "Followup on the News: Internet Spat Breaks Out over Qnet and Multi-level Marketing in india". Forbes. Retrieved February 3, 2013.
  31. ^ "Gold Quest to face more cases". The Times of India. Retrieved November 11, 2011.
  32. ^ AFP (11-02-2008). "Thousands protest in Kabul for banned scheme". Daily Times. Retrieved 20 December 2011. {{cite news}}: Check date values in: |date= (help)
  33. ^ John Gahamanyi (29 July 2009). "Rwanda: BNR Warns of Major Fraud in Popular Pyramid Scheme". Retrieved Dec 21 2001Template:Inconsistent citations {{cite web}}: Check date values in: |accessdate= (help)CS1 maint: postscript (link)
  34. ^ GAHAMANYI, John (04-09-2009). "Questnet banned". The Newtimes. Retrieved 20 December 2011. {{cite news}}: Check date values in: |date= (help)[dead link]
  35. ^ "Questnet". Questnet. Retrieved November 11, 2011.
  36. ^ Gertrude Majyambere. "Gov't lifts ban on Quest Net". The New Times Rwanda. Retrieved November 11, 2102. {{cite web}}: Check date values in: |accessdate= (help)
  37. ^ Saadet Zinciri Operasyonu. "TRT - Anasayfa" (in Turkish). TRT HABER. Retrieved November 12, 2011.
  38. ^ Ergin Hava. "Ministry to investigate QNet in Turkey". Today’s Zaman. Retrieved November 11, 2012.
  39. ^ "Sudanese Independent daily political". Al-Watan. Retrieved November 12, 2011.
  40. ^ "After The Prohibition And Stop The Activity" (in Arabic). ALN. Retrieved January 3, 2013.
  41. ^ "The Efforts of Sri Lanka to Combat MLM Pyramid Schemes" (PDF). Pyramid Scheme Alert. Retrieved November 11, 2011.
  42. ^ "Registrar of Companies refuse renewal agent Quest Net in Sudan - Niles" (in Arabic). ALN. Retrieved January 3, 2013.
  43. ^ "The Ministry of Economy stopped Quest Network in Syria" (in Arabic). Al-Watan. Retrieved November 12, 2011.
  44. ^ "إلغاء وكالة "كويست نت" تمّ منذ أشهر وعملها غير شرعي". syria-news.com. Retrieved June 4, 2012.
  45. ^ "Gold Quest banned". Nepali Times. Retrieved November 11, 2012.
  46. ^ ‘Suspicious’ "Qnet banned". ArabNews. Retrieved November 2, 2012. {{cite web}}: Check |url= value (help)
  47. ^ "Ministry of Commerce and Industry" (in Arabic). Ministry of Commerce and Industry. Retrieved November 12, 2012.
  48. ^ "Report: Indonesian ex-president helps catch Malaysian businessman in fraud case". International Herald Tribune. 7 May 2007. Archived from the original on 12 May 2007. Retrieved 28 March 2010. (Sourced from the Wayback Machine.)
  49. ^ Frazier, Donald (2012-10-24). Forbes Asia http://www.forbes.com/sites/donaldfrazier/2012/10/24/selling-a-better-life/. Retrieved 15 January 2013. {{cite news}}: Missing or empty |title= (help)
  50. ^ http://articles.timesofindia.indiatimes.com/2013-08-18/mumbai/41422291_1_qnet-police-custody-eow
  51. ^ http://articles.timesofindia.indiatimes.com/2013-08-29/mumbai/41579812_1_marketing-firm-qnet-cheating-case
Retrieved from "https://en.wikipedia.org/w/index.php?title=Qnet&oldid=574360283"