Amway MD: ARRESTED!

It has shattered image of Amway, in the eyes of all those consumers who believed in its trustworthiness for long. William S Pinckney, Managing Director and chief executive officer of Amway India, the direct selling company for various consumer products, arrested by the Andhra Pradesh police at Gurgaon. The police said charges had been filed against Pinckney under the Prize Chits and Money Circulation Schemes (Banning) Act, 1978. This was the second time Pinckney has been arrested in this country. The Kerala police arrested him last year on similar charges.

Amway India stated it was “aggrieved and shocked at the sudden and unwarranted act of detention”. “The case against which the action has been taken was filed in December 2013. The company had no prior information on the same. The allegations mentioned in the FIR (First Information Report) are frivolous and gives a misleading impression about our business,” it stated on Tuesday.

According to Amway, due to the lack of a legal framework for the direct selling sector, any case filed is being misinterpreted and booked under the 1978 law, which is meant to regulate financial schemes. The direct selling industry had been repeatedly seeking an amendment to the above law.

The Federation of Indian Chambers of Commerce and Industry (Ficci) and the Indian Direct Selling Association (IDSA) have condemned the arrest.

“This move has been initiated by a consumer complaint and could have been easily addressed, since there was no criminality involved,” Ficci general secretary, Didar Singh, stated. (Courtesy: Business Standard)

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Khosla ka Ghosla: Still reflecting the plight of today’s consumers

Way back in 2006 with the release of ‘Khosla ka Ghosla’, Dibakar Banerjee touched the issue of ‘Real Estate fraud’ which was never screened like this before. Written by Jaideep Sahni of ‘Chak de’ fame the movie was a big success and has transformed into a cult cinema.

The movie blatantly describes the suffering of today’s middle class man who is caught in the web of real estate fraud. It also elaborates in detail how helpless we are as consumers who are cheated by big corporate firms in our day to day lives, and we can hardly do anything to get justice on time.

Some of the scenes in the movie are so funny and real that you will instantly connect with them. Yes, it is the connectivity in the film with the common man that uplifts the plot of the film.

Right from an old aged middle class man’s (played by Anupam Kher) dream of owning a house, his interaction with family and friends, meeting with fraud real estate agents and the mafia is amazingly captured in detail. Moreover, the ‘Gandhian’ effort of Mr. Khosla to get back his property is most touching.

The movie has some of the best performances from Boman Irani( Real Estate Mafia), Praveen Dabas( Khosla’s son) and Ranveer Shourey ( who plays a lunatic elder son of Mr. Khosla).

Every time, we see this movie it teaches a lesson for us to become a smart, well informed consumer rather than getting swayed away and investing our hard earned money in fulfilling our property dreams. Though, we must believe that a wave of change is being witnessed in the real estate sector.

Recently the Allahabad High Court ordered to demolish Super tech’s two 40-storey towers in Noida for violation of building norms; this has opened a window of opportunity for helpless buyers. Similarly, the law took its due course in the Sahara scam where Subrata Roy had played with the hard money of around 3 crore consumers.

In addition to this, recent Land Acquisition Rehabilitation and Resettlement Act (LARR Act), and Real Estate Regulation Bill 2013 have played key roles for consumer rights in real estate sector.

If the law takes it course and judgement like these happen for the betterment of consumers along with proper regularisation, than poor Khosla’s dream of owning a house would come up without the struggle.

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‘Pesticide Menace’: Now central government at the rescue

The report submitted by Consumer Voice on ‘Pesticides in Vegetables’ way back in 2010 is finally spelling success. Authorities have initiated reform measures, i.e., the way situation needs to be dealt from the grass root level. With the intervention of the central government the problem can be tackled in a more smooth and refined manner. 

In a recent development the Delhi government told the Delhi High Court that tackling the problem of pesticide residues in vegetables and fruits sold across the Capital will need Centre’s intervention.

Several reports have pointed out a high content of pesticide residues in vegetables and fruits sold in Delhi that can cause various diseases, including cancer.

Amicus curiae Sanjay Jain submitted before a bench of Chief Justice G Rohini and Justice Rajiv Sahai Endlaw that the problem cannot be addressed by Delhi government alone.

“Delhi is a consumer market. The problem starts at the point of cultivation when various pesticides are added. Remedial measures have to start from the point the cultivation begins,” Jain said.

The high court, however, declined to accept Jain’s plea to include all the state authorities as a party in the case. “If some policy has to be made and implemented, the Union government is going to the implementing agency,” it said.

The agriculture ministry also informed the court that an extensive media campaign has been initiated to educate the people regarding safe use of pesticides in fruits and vegetables.

The ministry, in its affidavit, said the “Ministry of Agriculture has decided to extend all assistance to the state government of NCT of Delhi in setting up requisite infrastructure for enhancing its capacity to carry out sample testing of pesticides in fruits and vegetables”.

The Delhi government, represented by counsel Zubeda Begum, also informed the court that it was adhering to periodic monthly sample tests of fruits and vegetables sold in the city. The HC had acted suo motu on a report by NGO Consumer Voice, which in 2010 found that 35 varieties of vegetables and fruits, picked from Delhi markets and tested for pesticide content, had toxins beyond the permissible limits.

The report claimed that pesticides such as chlordane, endrin, heptachlor, ethyl and parathion were being used in growing number of vegetables. These pesticides can cause serious neurological problems, kidney damage, skin diseases, cancer and other diseases. Source: HT 

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Stable Rupee leads to flat travel insurance rates

People travelling offshore to benefit from a stable rupee, as there will be no hike in travel insurance rates.

As the rupee gets more stable, chances have increased that insurance companies are unlikely to increase their rates for insurance premiums. The claims for outbound travel insurance are paid out by general insurers in foreign currency while the insurance companies collect premium in rupees.

According to experts, insurers have been facing a higher loss ratio in the travel insurance portfolio as most of them had priced their policies when the rupee was around 55 to a dollar. The travel insurance segment is a very small portfolio for general insurers at 0.1 percent of the total premium collected by the industry.

Although, the travel insurance segment is growing industry, most travellers opt for Schengen area comprising of 26 European countries where having a cover is mandatory. Whereas, tourists believe that when travelling to South East Asia and West Asia one does not need a travel insurance.

For example, a 30-year-old traveller on a 10-day excursion to Europe would pay a premium of about R900 for a $100,000 cover for emergency medical expenses, accidental death, loss of baggage, etc. The same person would pay 30-40 percent more for a trip to the US and Canada. 
Courtesy: thehindubusinessline.com

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RBI: Banks should not charge for inoperative savings accounts without a minimum balance

In a recent development the RBI has asked banks not to implement penalties on consumers, who don’t have a minimum balance in their inoperative account.

The measure has come as a big relief for consumers as they were charged penalties by banks for their dormant bank accounts.

“It is advised that henceforth banks are not permitted to levy penal charges for non-maintenance of minimum balances in any inoperative account,” RBI said in a notification. Several banks, including the State Bank of India, do not levy any charge if the minimum balance is not maintained in an inoperative savings account.

In the first bi-monthly monetary policy statement for 2014-15 released last month, the RBI had said banks should also not take undue advantage of customer difficulty or inattention.

“Instead of levying penal charges for non maintenance of minimum balance in ordinary savings bank accounts, banks should limit services available on such accounts to those available to basic savings bank deposit accounts and restore the services when the balances improve to the minimum required level,” the report said.

Courtesy: PTI 

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Highest ever consumer confidence, says Nielsen India survey

In a recent online survey conducted by Nielsen on consumers it has been established that there has been an epic growth in consumer confidence since fourth quarter of 2012.

Despite the rising inflation and political delirium, the Indian consumers tend to remain positive regarding their purchasing or buying choices.

Industry experts believe that after a period of political uncertainty, the new government will bring in more stability in the market dynamics.

Piyush Mathur, President, Nielsen India says, “Consumers are reconciled to the negative economic conditions and despite the challenge of inflation, are hoping for a better year. ”   

Around 30,000 people across 60 countries responded to the survey. The key findings of the survey are as follows:

·   Consumer confidence increased in 60 percent of the markets measured by Nielsen, up from 43 per cent in the previous quarter (Q4 of 2013).

·      Around 74 percent of respondents in India are optimistic about job prospects over the next 12 months and the sentiment is up by 4 percentage points from the last quarter.

·     Around 54 percent of online respondents polled indicated that this is a good time to buy things they want and need.

·        The intention of online respondents investing spare cash in savings is up by six percentage points to 68 percent from last quarter.

·        Nearly half of those polled (49 percent) are looking to invest in new technology products and buy new clothes

·        More than 32 percent indicated they would invest in a retirement fund.

·        About 36 percent intend to invest in the stock market and in mutual funds.

In addition to these trends the consumer market will also become more positive if a stable government is elected to power. This scenario will lead to a rise in investment, better employment opportunities and more importantly an affirmative sentiment among the consumers.  

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Shop fined Rs 50 lakh for charging Rs 75 extra on drink

Charging a customer double for an energy drink has attracted a strong censure from the National Consumer Disputes Redressal Commission and a fine of Rs50 lakh for the vendor- Snack Bar, a unit of Saptagiri Restaurant. 

That October morning in 2009, a vendor at Chennai airport decided to make an extra Rs 75. Five years later, he may be poorer by Rs 50 lakh.

Charging a customer double for an energy drink has attracted a strong censure from the National Consumer Disputes Redressal Commission (NCDRC) and a fine of Rs50 lakh for the vendor- Snack Bar, a unit of Saptagiri Restaurant.

NCDRC lambasted Snack Bar for having collected Rs150 for a can of Red Bull from Delhi resident D K Chopra, while the retail price was Rs75. It also came down heavily on airport authorities who it said were "working in cahoots" with stall owners to obtain higher rates for licences. The commission directed the stall owner also to pay Rs10,000 to Chopra.

Chopra bought the drink at the airport in October 2009. Unhappy over being charged almost double, he issued a legal notice, but the stall-owner did not reply. Chopra then moved the District Consumer Disputes Redressal Forum (DCDRF) for a compensation of Rs2 lakh for "harassment and mental agony," and Rs11,000 as "travel and legal expenses." But the forum dismissed his complaint.

Chopra then filed a first appeal in the State Consumer Disputes Redressal Commission (SCDRC). This too was dismissed on the grounds that he had failed to prove the MRP of the product. He submitted two receipts for purchasing the drinks, which were not signed by the owner.

He approached the NCDRC. Counsel for Snack Bar said they were entitled to collect twice the MRP and submitted a letter from the deputy general manager, commercial at Chennai international airport. The letter mentioned the price of "imported juice/energy drink" as Rs140.

Questioning the logic of its classification as a juice, it said "by no stretch of imagination Red Bull can be called an imported juice energy drink." "Such a price list can be created any time and has exiguous value," said the commission. It also said the letter did not have endorsement from the Airports Authority of India. "Even if it is assumed that AAI had given permission, they are not empowered to do so. AAI cannot disturb MRP rates," the commission said. Stating a snack joint was "like a tea/ beedi stall," it said a person could not be forced to pay the prices which have been prescribed for restaurants.

"The stall owner has no right to misappropriate public money. It should go back to the public." said the commission, adding the vendor might have been charging above the MRP before 2009 and would have earned "crores of rupees." It directed the vendor to deposit the fine in the consumer welfare fund under the ministry of consumer affairs.

Coutesy: TOI

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