Association issues clarification on direct sales firm accused of scam
The iCon Group, a direct sales company suspected of scamming the public by using celebrities as influencers, was not a member of Thai Direct Selling Association (TDSA), the association said in a statement on Friday.
Complaints regarding the company’s dubious business operation started to surface earlier this week, with some of the resellers turning to social media influencers for help after they reportedly took loans or sold their assets to meet the sales quota set by the company. Some of them even faced bankruptcy and asset confiscation.
According to the police, the financial damage to victims was around 31 million baht. To take part in the company’s direct sales, victims had to pay fees for training and opening a credit line.
The opening credit was divided into three levels: normal for 2,500 baht, super for 25,000 baht and dealer for 250,000 baht, the police said.
Responding to the case, the TDSA said direct sales companies should register their business with the Office of the Consumer Protection Board, while maintaining confidence among distributors and consumers.
Direct sales companies should set fees for registration as product distributors at appropriate levels, which include guidebooks, training documents and product samples, the statement explained.
Companies should prepare reasonable business plans for long-term operation, and implement strict regulations to protect the interest of distributors and consumers.
Direct sales companies should allow consumers to return products within a specific period if the products do not meet consumers’ satisfaction. Meanwhile, companies and distributors should avoid false advertising.
“We believe that sustainable development of direct sales business requires collaboration in various aspects,” said TDSA president Tossaporn Nisthanon.
He said the association has promoted collaboration between the public and private sectors on raising awareness about direct sales business to consumers, while preventing issues that could affect the business image.
Moreover, the unity of association members could help boost confidence among product distributors, he said, adding that it would also boost the image of the Thai direct sales industry on a global level.
However, Tossaporn suggested that direct sales companies adapt themselves against global economic slowdown, decline in consumers’ purchasing power and e-commerce disruption by adopting technology, adjusting market strategy and boosting confidence among consumers.
