Mumbai cops issue notice for billiards great Michael Ferreira in Rs 425-cr QNet scam
If billiards great Michael Ferreira fails to respond, cops to increase pressure on him to turn up, says Crime Branch chief Himanshu Roy
When this interview was done, last month, Rajvardhan Sinha, (who is usually known by his first name only) Additional Commissioner of Police, Economic Offences Wing (EOW) was confident that former world billiards champion Michael Ferreira, summoned with reference to the QNet scam (see below: What is QNet) would make an appearance at the EOW shortly.
Saying that matters were still under investigation, Rajvardhan added that the EOW was still receiving complaints about QNet in a brief Q & A session at his office. Now, in the latest development, EOW has issued a Lookout Notice or LOC (Lookout Circular) as it is called for Ferreira. Himanshu Roy Jt. Commissioner of Police, (Crime) confirmed that there has been a Lookout Notice issued for Ferreira.
Questions to Himanshu Roy
Q: Has there been a lookout notice issued to Michael Ferreira?
Roy: Yes, it has. It was issued today (January 2) or late (January 1) last evening.
Q: What does this translate into exactly? Could you tell me what this lookout notice means?
Roy: It means he will be detained at airports and will be unable to pass through immigration. The immigration officer will then contact the Investigating Officer in Charge of the QNet case, who would then decide what is to be done.
Q: The EOW had issued a summons to Ferreira much earlier.
Roy: Yes, he had been issued a summons some time ago.
Q: Now, it has a Lookout Notice, what if he does not appear even now?
Roy: This is normal practice really, where we ratchet it up, if the person fails to respond. We take it to the next step, then the next step, then the next... there are several like arrests, attachment of property... different steps by which we compel that person to make an appearance.
Excerpts from an earlier interview with Rajvardhan:
Has the EOW summoned Michael Ferreira in connection with the Q-Net case?
Rajvardhan: Yes, Ferreira has been summoned a couple of days earlier. (MiDDAY met Rajvardhan on December 11). I do not remember the exact date, but that was four days ago, maybe.
Why has he not appeared as yet?
Rajvardhan: Apparently, he is unwell. His lawyer has been communicating on his behalf with our Investigation Officer (IO).
There is a buzz that Ferreira has fled the country. Is that true?
Rajvardhan: I am not in a position to state whether he has fled the country. This investigation into QNet has been on for at least two-three months. We had not sent a summons for Michael Ferreira earlier.
Reports state that the QNet scam is to the tune of Rs 425 crore. Is that figure credible?
Rajvardhan: Yes, it is till now. We have found out that Rs 425 crore worth of money has been siphoned away. Yet, this is by no means the final amount. Complaints are still pouring in, more people are coming forward and these are being investigated, so the figure is fluid. Complaints are coming in through a website too.
What is the demographic of people complaining? Are they from a particular section of society?
Rajvardhan: There are all kinds of people -- from housewives, which form a considerable segment, to professionals, their friends and relatives. Vihaan is the master franchise and Michael Ferreira owns 80 per cent of shares in that franchise. Being a director who owns 80 per cent of shares, Ferreira would have to join the investigation and open the book of accounts.
What is your message to the gullible public who continue to get fooled by get rich quick promises and dubious schemes?
Rajvardhan: As you know the Economic Offences Wing deals with what is known as White Collar Crime. My sincere appeal to people is to be wary. These crimes happen because of greed. Nobody can get rich overnight. Please do not fall into these traps, which are sometimes even set up by relatives and friends. Please apply one's own mind and thinking and use logic.
With the stature and names involved in white collar crime, people are wary of complaining or are intimidated and threatened...
Rajvardhan: If any complainant fears for their life, they should approach the police.
Who is Michael Ferreira?
Michael Ferreira is a three-time Amateur World Billiards Champion. Ferreira is the first billiards player to be awarded with the Padma Bhushan, the third-highest civilian award in India, which was conferred on him after he won his third World Amateur Billiards title in 1983. He is also the recipient of the State's Shiv Chhatrapati Award (1971), the Arjuna Award (1973) and the International Fair Play Committee's Letter of Congratulations (1983). He received the Dronacharya Award in 2001, for his coaching achievements in billiards and snooker.
Michael Ferreira resigned as President of the Billiards & Snooker Association of Maharashtra, (BSAM) in December. The BSAM Managing Committee in its meeting held on December 14, 2013 unanimously accepted the resignation. Vice president Rajan Khinvasara took over as BSAM president and Yasin Merchant replaced the vice president.
What is QNet?
QNet Ltd, formerly known as QuestNet, GoldQuest, and QI Limited, is a Hong Kong based direct selling company owned by the QI Group. The company sells a variety of products. 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 did not respond to questions seeking comment on the notice. Meanwhile, a lady answered a telephone call to the Ferreira residence on Thursday evening, but said Ferreira was unavailable and could not comment. Ferreira did not respond to SMS messages for comment too. QNet, in an interview, sought to clear the air about Vihaan and the QNet scam.
It (Qnet) operates in India through its official franchisee called Vihaan Direct Selling Pvt. Ltd.
Yes, given that this is an established manner of business. Many multi-national product-based companies have chosen the franchisee model to operate globally as it works well in product categories where manufacturing happens at a centralized unit.
I personally visited Michael Ferreira at his home, on his request where he tried to hard sell the Q Net scheme.
Of course that may be possible, but please understand that in a DS/MLM industry every distributor is a consumer first before he becomes a distributor. Most QNet distributors, with no exception would naturally be strong promoters of the products they have experienced personally and it is only natural for them to in turn promote it to their network of friends and family. I am sure that it was not in any negative manner in which the sale was sought to either, given the professionalism and exceptional nature of the man concerned!
Isn't Qnet a Ponzi scheme?
No it is not. It is very simple for a citizen to recognize a 'Ponzi Scheme' as the principal difference is that in a 'Ponzi Scheme' commissions are paid for recruiting people. In genuine DS/MLM companies, it not important how many people you are able to sign-up on your network but rather the volume of sales you are able to achieve through your network team. No one has received any commission in Qnet for recruiting people in their network. Commensurate commissions are paid only on sale of products. Qnet has been demanding a ban on 'Ponzi Schemes' and has always welcomed a ban through a clear legislation.
Does the Biodisc (one of the products) contain healing properties/energizing properties as claimed by QNet?
The Biodisc was introduced by Qnet in 2006 to its global customer base and has proven to be one of our most popular products. The company has never made any medical claims or miraculous properties as alleged.
QNet though clarifies that in April 2013, Parmeet Kaur, the wife of Gurpreet Singh Anand, filed a complaint against 3 IRs, which affected QNet and its local franchisee Vihaan Direct Selling (India) Pvt. Ltd. Vihaan at Oshiwara Police Station in Mumbai. The complaint alleged that three representatives of Vihaan sold Parmeet Kaur a bio-disc, which would be able to 'help her son's brain damage'.
The three representatives deny misrepresenting any product to Parmeet Kaur as this would be in breach of the agreement they signed with Vihaan. Company records indicate that Parmeet Kaur did not agree to purchase a bio-disc but signed up for an educational course. This was cancelled by her husband along with the cheque.
What is Multi-Level Marketing?
Multi-level Marketing (MLM) is a marketing strategy in which the sales force is compensated not only for sales they personally generate, but also for the sales of the other salespeople they recruit. This recruited sales force is referred to as the participant's 'downline', and can provide multiple levels of compensation. Other terms used for MLM include pyramid selling, network marketing, and referral marketing. Companies that use MLM models for compensation have been a frequent subject of criticism and lawsuits.
Criticism has focused on their similarity to illegal pyramid schemes, cult-like behaviour, price fixing of products, high initial entry costs (for marketing kit and first products), emphasis on recruitment of others over actual sales, encouraging if not requiring members to purchase and use the company's products, exploitation of personal relationships as both sales and recruiting targets, complex and sometimes exaggerated compensation schemes, the company making major money off its training events and materials, and cult-like techniques which some groups use to enhance their members' enthusiasm and devotion.
What is White Collar Crime?
White-collar crime refers to financially motivated nonviolent crime committed by business and government professionals. Within criminology, it was first defined by sociologist Edwin Sutherland in 1939 as "a crime committed by a person of respectability and high social status in the course of his occupation." Typical white-collar crimes include fraud, bribery, Ponzi schemes, insider trading, embezzlement, cybercrime, copyright infringement, money laundering, identity theft, and forgery.