Indian authorities froze 137 crore rupees, approximately $16 million, tied to QNet in late March. This action followed a new criminal case opened in Hyderabad, initiated just a week after a March 17th fire killed five people at a QNet-affiliated office. The blaze at the Swapnalok Complex, a building now described by local police as a "sweatshop," prompted renewed scrutiny into the company's operations and recruiting practices.
Madis Naveen, a friend of one victim, filed a formal complaint at the Mahankali police station on March 22nd. Naveen stated he deposited Rs 1.60 lakh, roughly $1,940, with QNet in June 2022. Center heads K. Shiva and N. Vijaya had promised him substantial monthly returns ranging from Rs 30,000 to Rs 60,000, alongside the full return of his principal investment, without requiring him to sell any tangible products. He received none of the promised incentives or his initial deposit, a common outcome in such recruitment-focused schemes.
Police reports indicate 25 other QNet promoters have since filed similar complaints, detailing analogous financial losses and unfulfilled promises. Shiva and Vijaya were arrested in connection with these grievances. During questioning, they identified Rajesh Khanna as "the main conspirator and owner of Q-Net" in India. Police believe Khanna also controlled an earlier iteration of QNet, which the state's Criminal Investigation Department (CID) banned over eight years ago following numerous public complaints of fraudulent activity and financial exploitation. This history suggests a pattern of operations under different names to circumvent regulatory action.
QNet conducts its Indian business through a registered entity named Vihaan Direct Selling Pvt Ltd. In Hyderabad, the scheme often operates under the local brand "V-Empire," targeting new recruits. Khanna's ownership appears specific to the Indian network; Malaysian national Vijay Eswaran controls the global parent company. Authorities are now tracking Khanna's mobile communications and scrutinizing his extensive financial records. They are also investigating any similar multi-level marketing (MLM) schemes he might be operating in other Indian states, looking for connections to the wider network.
On March 30th, The Times of India reported the Enforcement Directorate (ED), India's primary financial crime agency, had seized the 137 crore rupees from Vihaan Direct Selling. This significant asset freeze followed extensive, coordinated searches at multiple QNet-linked locations in Hyderabad and Bengaluru. During these operations, ED officials confiscated a range of physical documents and digital devices, including computers and mobile phones, seeking evidence of money laundering and other financial irregularities.
The seized funds are distributed across 50 bank accounts belonging to various individuals and entities connected to the case throughout India. This current action is not QNet's first encounter with Indian law enforcement. In January, authorities announced a separate $11 million asset freeze stemming from ongoing QNet investigations in other regions. The company faces multiple active criminal cases across the country, often under the Prevention of Money Laundering Act (PMLA) and various consumer protection laws. These cases consistently accuse the firm of running a fraudulent pyramid scheme, where participants earn money primarily by recruiting new members and their investments, rather than through the legitimate sale of products or services.
Despite the continuous legal pressure and multiple asset freezes, QNet's market activity in India remains stubbornly significant. SimilarWeb data from February 2023 shows India accounts for 33% of all visits to QNet's global website, an increase of 14% month over month. While overall traffic to the site has shown a decline, India continues to be a substantial and active market for the organization. This suggests recruitment efforts persist even under the shadow of legal challenges.
Malaysian authorities, despite QNet's founding in 1998 in that country, have taken no known enforcement action against the company's global operations. QNet continues its business from its base in Hong Kong, operating without apparent regulatory impediment in its country of origin.