17 Direct Selling Firms Probed for Violating Consumer Protection Rules

The Central Consumer Protection Authority (CCPA) has taken a firm stance against violations in the direct selling industry, issuing notices to 17 entities found flouting the Consumer Protection (Direct Selling) Rules, 2021. Of these, 13 entities are currently under investigation, while responses from three entities are awaited. As part of its crackdown, the CCPA conducted detailed examinations of the websites of these entities, identifying multiple instances of non-compliance. These actions align with the authority’s efforts to ensure that the direct selling industry operates transparently and in accordance with the law.

Understanding Direct Selling and the 2021 Rules

Direct selling is a method of marketing and distributing goods or services directly to consumers, bypassing fixed retail premises. The business model relies on independent representatives, often referred to as direct sellers, who engage with customers through personal interactions, online platforms, or home presentations.

ALSO READ | Digital Innovation Conclave 2025: Fostering Industry Transformation

While ethical direct selling companies offer high-quality products and fair compensation, the model has also been misused by fraudulent entities promoting illegal pyramid schemes. Such schemes often lure consumers with unrealistic promises of high returns and wealth, contingent upon recruiting others, violating consumer trust and established laws.

The Consumer Protection (Direct Selling) Rules, 2021, were introduced to regulate the sector, mandating transparency, accountability, and ethical practices. These rules complement other consumer protection frameworks, including the Consumer Protection (E-Commerce) Rules, 2020, and the Legal Metrology (Packaged Commodities) Rules, 2011.

Common Red Flags in Direct Selling

Consumers are urged to be vigilant and watch for signs that may indicate fraudulent practices, including:

1. Large Joining Fees: Entities demanding substantial upfront investments.
2. Recruitment-Based Compensation: Emphasis on earnings through recruitment rather than product sales.
3. Lack of Refund Policies: Absence of clear return, buy-back, or cooling-off periods.

ALSO READ | Big Ideas That Will Shape India’s Financial Revolution in 2025

To avoid falling victim to such schemes, consumers should:

• Verify the company’s disclosures, including its registration certificates and legal documentation.
• Interact only with direct sellers who provide valid identification and avoid unsubstantiated claims.
• Thoroughly review contracts and understand the entity’s refund and grievance mechanisms.

Entities Under the CCPA’s Radar

The following 17 entities have been served notices for alleged unfair trade practices, service deficiencies, and violations of the 2021 rules:

1. Vihaan Direct Selling (India) Pvt. Ltd. (QNet Group, Hong Kong subsidiary)
2. Triptales Pvt. Ltd.
3. Oriens Global Marketing Pvt. Ltd.
4. Zennesa Wellness Pvt. Ltd.
5. Orgolife Solutions Pvt. Ltd.
6. Oriflame India Pvt. Ltd.
7. Juncture Marketing Pvt. Ltd.
8. Wolte Marketing Pvt. Ltd.
9. Preet Life Care Pvt. Ltd.
10. Enroots Horizon Pvt. Ltd.
11. E Biotorium Network Pvt. Ltd.
12. Meghdoot Marketing Pvt. Ltd.
13. Suii Dhaaga Lifestyle Pvt. Ltd.
14. Winmarg Business Pvt. Ltd.
15. Ayusratna Natural Herbal Pvt. Ltd.
16. Biothon Lifecare Pvt. Ltd.
17. Okflip India Pvt. Ltd.

ALSO READ | See How Improved Infrastructure Is Fueling India's Startups?

Ensuring Consumer Safety

The CCPA’s action aims to eliminate deceptive practices and restore consumer trust in the direct selling industry. Entities are reminded to strictly adhere to the regulatory framework and prioritize consumer welfare in their operations.

The Government of India remains steadfast in its mission to foster a transparent and consumer-friendly market ecosystem. Consumers are encouraged to report suspicious activities or violations to the appropriate authorities.

Disclaimer: This article is based on a Press Information Bureau (PIB) release and has been creatively modified without altering the facts.