Amway India, which runs a multi-level marketing (MLM) scheme, generated proceeds of crime worth more than Rs 4,000 crore and a substantial part of it was siphoned off to overseas bank accounts, the Enforcement Directorate alleged on Monday.

The federal agency said this after filing a charge-sheet against Amway India Enterprise Pvt Ltd before a special Prevention of Money Laundering Act (PMLA) court in Hyderabad.

The court took cognisance of the prosecution’s complaint on Monday, the Enforcement Directorate (ED) said in a statement.

The criminal case of money launderingregistered by the ED stems from multipleFIRs filed by the Telangana Police againstAmway and its directors.

It is alleged that they were promoting an”illegal money circulation scheme underthe guise of sale of goods” and “cheating thegeneral public by promising them very highcommissions/incentives through simpleenrolment of new members and byclaiming that thesecommissions/incentives would continue inperpetuity.”

The company, however, said it was incompliance with the law.

“The prosecution complaint, currently, filed by the Enforcement Directorate pertains to the investigation dating back to 2011, and since then, we have been cooperating with the department, and have shared all the information as sought from time-to-time. An Amway spokesperson said.

Since Amway began its operations in India 25 years ago, it has been “committed to legal and regulatory compliance, and has diligently maintained a culture of compliance and integrity to the present day”, the spokesperson said.

“We want to reiterate our continuedconfidence in the Indian legal and judicialsystem following the due process of law aswe pursue our legal rights,” thespokesperson said.

The ED said in its probe, it found thatAmway was promoting a pyramid scheme’in the guise of’ direct selling.

“Instead of selling goods directly to the endconsumer, Amway floated a multi-levelamarketing scheme of members andintroduced many intermediaries in thename of distributors,” it said.

“The scheme does not focus on sale ofproducts but survives primarily onenrolling members,” the ED said.

The agency said once a newcomer isconvinced to pay money through someonewho has referred him or her to thecompany, he or she becomes arepresentative, and to earn commission, heor she has to enrol new members.

As the number of persons increases downthe line, the ones on top get morecommission and more incentives such asluxurious tours, it said.

Amway not only operated a multi-levelmarketing scheme, but also a moneycirculation scheme, and has collected ‘huge’amounts from its subscribers, the agencyalleged.

‘By commission of the scheduled offence ofcheating, Amway has generated proceedsof crime totalling to Rs 4,050.21 crore,” theED said.

More than Rs 2,859 crore collected frommembers has been ‘siphoned off andparked’ in the bank accounts of overseasinvestors in the name of dividend, royaltyand payments for other expenses, it said.

Assets worth more than Rs 757 croreattached by the ED in this case in April lastyear.