Even though several multi-level marketing scams have caused a great deal of trouble, local authorities have been unable to fix the lax management over such schemes.

Unicity collects contribute money from participants

Multi-level marketing has increased in Vietnam, attracting a large number of companies and individuals. Most of these kinds of businesses in Vietnam involve food, cosmetics and physiotherapy equipment.

In pursuit of high profits, they violated regulations and tricked hundreds of people. Hung, an agent for Unicity Company, said he was tricked into this programme by a friend. "He told me that he earned tens of millions per month, so I sold my motorbike for VND8 million (USD384) and borrowed from other people, for a total of VND20 million. After spending all of this money on their products, I was happy because they gave me back VND3 million." he said.

In order to get commission fees, Hung had to lure 10 other people into paying VND20 million to the company. "I got four people from my village and now we're all in debt. My mother fell ill when she found out what I had been doing. I'm so ashamed that I don't dare to go back home." Hung said.

Over the past few years, there have been a wide range of such "companies" discovered in Vietnam, as well as arrests at several multi-level marketing firms, such as muaban24 and Thien Ngoc Minh Uy. But the situation remains an important one due to unclear regulatory work.

Bui Minh Trang, director of HCM City Department of Health said the punishments are insignificant. "We just manage fines for false advertising, which is only VND5-8 million. In addition, many firms disguise their advertising programmes as conferences. It's hard to tell the real intent because those 'conferences' ban recording devices. We asked for help from the Vietnam Food Administration, but they don't know what to do either."

Trang said they have a hold on certain violating companies, such as Unicity. In near future, they will cooperate with the Department of Information and Communications in order to carry out a more thorough sweep and publicise the names of violating firms. Currently, the department is drafting new regulations to control food management so that may revoke the business licences of violators.