The six people who died in the Secunderabad fire, which engulfed the Swapnalok Complex on the night of Thursday, 16 March, were employees of Vihaan Direct Selling Pvt Ltd, an official franchisee of Hong Kong-based multi-level marketing company QNet.
There are several cases of alleged investment frauds against QNet, including some pertaining to money laundering being investigated by the Enforcement Directorate (ED). In 2014, the ED had named QNet; Vihaan Direct Selling; Vijay Eswaran, founder of the QI Group which owns QNet; and three other independent representatives of QNet from Mumbai in an alleged Rs 425 crore scam.
Vihaan Direct Selling Pvt Ltd had a unit on the fifth floor of the Swapnalok Complex, which was destroyed in the fire, alongside two other offices on the same floor – Kedia Infotech Ltd and Vikas Paper Flexo Packaging Ltd.
The Mahankali Police on Friday, 17 March, registered a case against all three companies as well as the Swapnalok Complex Association for culpable homicide (not amounting to murder) for failing to implement necessary fire safety measures.
The deceased – U Shiva, R Triveni, V Vennela, K Prameela, B Shravani, and A Prashant – were all below 25 years of age and died of carbon monoxide inhalation. They were all employed as marketing executives by the QNet firm.
Probe Against QNet Firm
Speaking to the media outside Gandhi Hospital, where five of the six persons were declared dead, the families of the deceased claimed that Vihaan Direct Selling had taken deposits of over Rs 1.5 lakh from them and promised them huge returns.
The ED, in January, had conducted searches at the QNet franchisee's offices in Mumbai, Bengaluru, and Chennai.
In a tweet on 18 January, the ED said it had frozen 36 bank accounts linked to various companies, individuals, and proprietorships in connection with the case.
Telangana Minister for Animal Husbandry Talasani Srinivas Yadav told reporters on Friday, 17 March, that the state government has received complaints against QNet from various districts, including Mahabubabad, Warangal, Narsampet, and Khammam.
"There are complaints against QNet from other victims, too. Cases will be registered and culprits will be arrested and recoveries will be made," he said.
The company has been accused of luring people into depositing huge sums of money with the promise of gaining instant riches.
On its official website, www.qnet.net, the company claims, "There's a lot of misinformation out there making QNet out to be a scam or a pyramid scheme. Most of this misinformation is founded in a lack of understanding of the direct selling business model and how it differs from fraudulent pyramid schemes."
Ex Gratia For Families of Deceased
Prime Minister Narendra Modi on Saturday, 18 March, announced a Rs 2 lakh ex gratia for the families of the deceased.
On Friday, Telangana Chief Minister K Chandrasekhar Rao had announced a compensation of Rs 5 lakh.
(At The Quint, we are answerable only to our audience. Play an active role in shaping our journalism by becoming a member. Because the truth is worth it.)