GEORGE TOWN: Penang Domestic Trade and Consumers Affairs Ministry today raided a multi-level marketing company at Jalan Perak here and seized RM201,136.00 worth of health products.
State director Mohd Ridzuan Ab Ghapar said this was the second raid conducted against the company, with the first at its Kuala Lumpur office last year.
He said a team of seven enforcement officers stormed the Jalan Perak office this morning after receiving information that it had continued operation in Penang despite still on trial for the first case.
Ridzuan said last year, the company was charged under Section 4 of the Direct Sales and Anti-Pyramid Schemes Act 1993 for conducting direct sales without a valid licence.
He said if convicted, the company faces a fine not exceeding RM1 million for the first offence and, for a second or subsequent offence, to a fine not exceeding RM2 million.
“We receive information that they are still conducting direct sales and pyramid scheme in Penang.
“In today’s raid, we seize their products and documents as well as recorded statements of their two stockists.
“We will charge them again under Section 4 of the 1993 Act,” he told newsmen at the site.
He said the company started operations in 2017 and sold health products that were manufactured in Selangor.
Ridzuan said it was likely that the company, which has a licence for retail sales, had resorted to direct selling and pyramid scheme to rake in faster profit.
He said the company also attracted members by offering lucrative bonuses with the sales of the health products, which are priced exhorbitantly.
“They have different packages for the products, with the cheapest being RM500 and the most expensive RM3,000.
“We estimate that they have made millions of ringgit in the past two years and have hundreds of members.” he said, adding that the company’s focus appeared to be on multi-level marketing instead of selling products.
He said the company would also be investigated for misrepresenting its members and customers about having an international presence.