Agel Vietnam, a Hanoi-based company selling nutritional supplements under the multi-level marketing model, has reneged on pledged commissions and failed to deliver purchased products after having inexplicably vanished from the Vietnamese market. The company is 90% US-invested with the remaining stakes sourced from Vietnamese investors.
T.H.V, an Agel Vietnam’s agent for the southern region, said that by now - a few months after the mysterious disappearance, many small dealers have neither received their commissions nor the products which they have bought.
Chu Thi My Huong, a multilevel leader with more than 23,000 members in her network, said the total loss of members in her pyramid is VND3 billion (US$150,000).
She said hundreds of other network leaders have suffered similar losses.
Since its establishment in mid 2008 as a distributor of Agel products from the US, Agel Vietnam soon enjoyed reputation as one of the most successful companies in multi-level marketing.
Although the price of an Agel’s product can be as high as VND1.5 million (US$75), thousands of customers were willing to pay VND20.3 million ($1,000) to buy 16 products at wholesale prices to become a member in this multi-level network.
Like any other multi-level companies, members in Agel’s network had to convince more people to join their networks to increase accrued profits.
Tuoi Tre found out that Agel Vietnam had rented the house at 73, Trang Thi Street, Hanoi to set up its headquarters in 2008.
But in February this year, Agel Vietnam abruptly ended its house renting contract, emptied its headquarters and disappeared.
New, unlicensed offshoot
After Agel Vietnam’s shut down, many of its leaders shifted to working for Qivana Vietnam, another multi-level marketing company which also sells nutritional supplements.
The new head of Qivana Vietnam is Hoang Hai Yen, who used to be head of Agel Vietnam.
Qivana Vietnam has its headquarters in HCMC and its main products are some nutritional supplements with prices of up to VND1.2 million per box.
With the same strategy as Agel Vietnam, Qivana Vietnam also urges its dealers to buy its products when they still do not know much about them.
A representative of the HCMC Department of Industry and Trade told Tuoi Tre that the department has not licensed Qivana to run as a multi-level marketing company.
Earlier in June, the Department suspended Tran Hoang Corporation for operating an illegal seminar to convince people to join its multi-level marketing program to sell Qivana’s products.