Wednesday, 8 February 2012

Report On Fraud Scheme Operated By Qnet, QuestNet, Gold Quest or QI Group


Latest development:


Special Message "The economic offences wing of Mumbai police froze two bank accounts of Qnet that have Rs.45 crore in balance, moreover the case against Qnet will be more strong if more victims come forward and make a complaint. Also making by making a complaint the victims have a chance of getting their money back.
I would request all the people who have lost their money or have faced any other problem because of Qnet fraud, to come forward and registered compliant with economic offences wing of Mumbai police. Mr.Gurupreet Singh Anand (The person who has filed first FIR and made possible to show the fraud to police and media) is willing to help anyone who wish to file complaint, you can contact him on banqnet@gmail.com, kindly keep me in CC in case you send him e-mail. My id is sumit.s.navani@gmail.com."




I am making this report to bring out my opinion on marketing scheme operated by Qnet, QuestNet, GoldQuest & QI group, which I feel, in the context of below mentioned facts, is a fraud.All the information contained in this report is gathered by me from internet or some of individual who promote the fraud scheme in Mumbai, India. Virtually it is clear from this report that the gang is a fraud, but however all the proofs cannot be gathered from internet or like sources. Mumbai Police has also started arresting people in Qnet fraud. http://articles.timesofindia.indiatimes.com/2013-08-18/mumbai/41422291_1_qnet-police-custody-eow


Along with this report, I would also request you to visit http://qnetexposed.com/ for more and latest updates.


For reading copy of charge sheet please click this link

India's largest news paper also carried a article on Qnet, below is the screen shot and link to that news.


http://timesofindia.indiatimes.com/business/india-business/EOW-registers-case-against-multi-level-marekting-firm-QNet-for-fraud/articleshow/21864040.cms

First I understand using the under mentioned facts that Qnet, Questnet, Gold quest & QI are of same group.
Point No.1: Here is screen shot of Qigroup.com, which shows “Qnet” as a group company of QI group
Note No.1: QI group and Qnet are under same group
.

 Point No.2: When people transferred money from India to QI group-Hongkong, they received receipts from “QuestNet” on their e-mail, here is a screen shot of such receipt, I have removed personal details from the receipt.
Note No. 2: “QI Group” and “QuestNet” are under same group.

Point No.3: Here is screen shot of Hongkong governments’ website, which shows “Goldquest” changed its name to “Questnet” in 2003.
Note No.3: “Goldquest” and “Questnet” are same companies
  
Point No.4: Copy of the judgment given by the high court of Hong Kong (Available on the website of the Judiciary of the Hong Kong http://legalref.judiciary.gov.hk/lrs/common/search/search_result_detail_frame.jsp?DIS=55273&QS=%2B&TP=JU”)
Note No.4: The Judgment clear states that “Questnet” is a company of QI group
“                                                                                                                                       HCA 1475/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 1475 OF 2006
____________

BETWEEN

                                                         QUESTNET LIMITED                                         Plaintiff
                                                                        and
                                                 KURT GEORG ROCCO RINCK                         1st Defendant

                                                      WILFRED ROYCE LANE                             2nd Defendant
____________
Before: Hon Saunders J in Chambers
Date of Hearing:  30 November 2006
Date of Judgment:  30 November 2006
______________
J U D G M E N T
______________
QuestNet is a company incorporated in the British Virgin Islands, and registered in Hong Kong under Part XI of the Companies Ordinance.  QuestNet is owned, as to 80%, by QI Ltd, a Cayman Islands company, and as to 20% by a Mr Joe Fabregas.   QuestNet is one of various companies within a Group, principally owned by QI Ltd.  The defendant, Mr Rinck, and two others, and Mr Bismark and a Mr Vijayaratham were the founders of the Group.”
I have not copied the irrelevant part of judgment.
Point No.5: When you click “Shop” button on website of QuestNet “http://www.questnet-india.com/”, you are redirected to https://portal.qnet.net/
Note No.5: “QuestNet” & “Qnet” are under same group.
Point No. 6: The following two screen shots show data available on the website of Ministry of corporate affairs, India. It shows “QuestNet” & “GoldQuest” have defaulted in filing annual returns, which are mandatory under India law. Further, both the companies have same registered address and e-mail address.
Note No.6: QuestNet & GoldQuest are same companies and have defaulted in following Indian law




Note No.7: Hence from Note nos. 1, 2, 3, 4, 5 & 6, we conclude all four “QI”, “Qnet”, “QuestNet” & “Goldquest” are operated by same group. 

Point No.7: An article by Economic times, it states the “QI group” has denied association with  “QuestNet”

Note No.8: I have been already able to understand from note No.5 that “QI” & “QuestNet” are operated by same. Not accepting the association is clearly eyewash, because scam of Gold quest was already out so the best way was to disassociate “QI” from “Goldquest”.

Point No.8: An article by Times Of India on Gold quest                                     
Note No.9: Scam of Gold quest is out since May, 2008.

Point No.9:  US district court ordered CEO QuestNet to pay $ 2,251,185 as penalty for frauds done by Quest Net: (http://www.sec.gov/litigation/litreleases/lr18770.htm)
In the complaint to court done by US Securities & Exchange commission, the commission alleged that,(http://www.sec.gov/litigation/complaints/comp17616.htm)

A.     Quest Net formed fake company “Grupo” and showed fake purchases of computer hardware and software:
On December 29, 1998, Quest Net issued a press release announcing that it had purchased certain assets totaling $2 million from Grupo Internet Latinoamericano S.A. ("Grupo"), a privately held British Virgin Islands company. Quest Net claimed that it purchased these assets, which purportedly consisted of computer hardware and software, from Grupo in exchange for common and preferred stock in Quest Net valued at $2 million. This press release quoted Defendant (the CEO of QuestNet) Pereira as saying that "[w]e are on course to expand Quest into a full service Internet solutions company, not just an Internet provider," and that "[t]his acquisition is another step in that direction."
In a second press release issued after the stock market closed on December 30, 1998, Quest Net again mentioned the Grupo transaction and boasted that the acquisition had "fueled the second straight day of positive active trading" of the company's stock.
These press releases were blatantly false and misleading because the Quest Net/Grupo transaction was a complete sham. Grupo was in fact nothing more than a shell company that Defendant (the CEO of QuestNet) formed and controlled as part of a fraudulent scheme to manipulate Quest Net's stock price. Defendant (the CEO of QuestNet)formed Grupo with Quest Net funds and, in order to conceal his control of Grupo, Defendant (the CEO of QuestNet) appointed his father-in-law, David Plant, as the sole director of Grupo. As with the WebCafe transaction, Defendant (the CEO of QuestNet) obtained a general power of attorney over all of Plant's business dealings, including, Grupo. None of these facts were disclosed by Defendant (the CEO of QuestNet).
Moreover, Grupo in fact never owned much of the telecommunications equipment that Quest Net claimed to have purchased from Grupo. Some of the equipment that Defendant (the CEO of QuestNet)claimed to have acquired from Grupo belonged to third parties and had already been in Quest Net's possession before the sham "purchase" from Grupo.
The fraudulent press releases Quest Net disseminated on December 29th and December 30th concerning this sham transaction caused Quest Net's stock price to soar from a price of $2.53 per share with 26,200 shares traded on December 28th to a high of $30 per share with 441,600 shares traded on January 5th.
B.     QuestNet issued fake press releases to increase their stock price:

a.    Acquisition of Quest Net's First Wireless Client

On July 31, 1998, Quest Net issued a press release announcing that Quest Net had signed its first contract for wireless broadband service with a privately held Florida corporation named WebCafe Corporation ("WebCafe"). The press release boasted that the contract with WebCafe "marks the start of Quest Net's first penetration in the wireless broadband distribution." The press release identified the president of WebCafe as "Patricia Martins."

This press release was materially misleading because it failed to disclose that WebCafe was a company formed, owned and operated by Defendant (CEO of QuestNet). Indeed, Defendant (CEO of QuestNet) incorporated WebCafe a mere seven weeks prior to the date of the press release. WebCafe's president, Patricia Martins, is in reality Defendant's (CEO of QuestNet) sister who had granted Defendant (CEO of QuestNet) a general power of attorney over all of her business dealings, including, of course, WebCafe. None of these material facts were disclosed by Defendant (CEO of QuestNet).

b.  Quest Net's Purchase of Ecreditcard.com
On April 1, 1999, Quest Net issued a press release announcing that Quest Net had purchased an e-commerce website named "Ecreditcard.com" for an undisclosed amount of cash and stock. According to the press release, Ecreditcard.com specialized "in providing secure [c]redit [c]ard [sic] for clients worldwide" and had been "in operation for over two years with great results."
This press release was misleading and failed to disclose that Defendant owned Ecreditcard.com and was running the website. Defendant had purchased and registered the "Ecreditcard.com" domain name in July 1997.
c.  Quest Net's Inflated Revenue Announcements
On March 29, 1999, Quest Net issued a press release that provided an address for an Internet website which had hosted an online interview with Defendant. During this interview, Defendant falsely stated that in: "[t]he last two quarters, in terms of revenues that have been collected, [Quest Net] had about $900,000 of revenue per quarter."
On April 13, 1999, Quest Net issued a press release reporting that Quest Net had generated $1,526,053 in gross revenues and $423,181 in pretax profits for the six months ended December 31, 1998. The next day, the company issued another press release that also touted its gross revenues and profit figures for the same period.
Defendant's online interview and the two April 1999 press releases failed to disclose that over 30% of the approximately $1.5 million in reported revenues was made up of a potentially uncollectible receivable from a Quest Net customer who was involved in ongoing litigation with Quest Net over the receivable. The dispute involved Quest Net's sale of software to the customer and whether Quest Net had delivered a fully functional version of the software.
After the issuance of these two false press releases, the company's stock price dramatically rose from $4.56 per share on April 12th to $13.50 per share on April 15th. During these three days of trading, the trading volume increased from 42,100 shares traded on April 12th to 290,000 shares traded on April 15th.
C.     By making the above mentioned frauds, shares prices of QuestNet went up because common people received wrong information given by QuestNet, and the CEO of QuestNet sold his shares at fraudulently increased prices.

In total, from December 1998 through April 16, 1999, the CEO of QuestNet sold approximately 215,000 shares of Quest Net stock resulting in proceeds of more than $2.0 million. The majority of this money was eventually wired from nominee accounts and sent to various foreign bank accounts and offshore trusts that are controlled by same CEO of QuestNet.



Point No.10: Website of Qnet, showing Vijay Eswaran as founder of it
Note No.10: Vijay Eswaran is the person behind the companies.

Point No.11: Personal website of Vijay Eswaran showing his roots from Sri Lanka
Note No.11: Vijay Eswaran has his roots from Sri Lanka.

Point No.12: Screen shot of website “http://everything.explained.at/Dato_Vijay_Eswaran/” showing “Vijay Eswaran” as wanted by International Police (Inter Pol) for drugs related crimes


Point No.13: Screen shot from website of International Police (Inter Pol), listing “Eswaran” as a person wanted for Drugs related crime in Chennai, India:
Note No.12: From point No.11 & 12, we understand “Eswaran” is wanted by International Police.


Point No.14: A tip-off by a former Indonesian president led to the arrest of Vijay Eswaran in Jakarta.

Note No.13: Due to loop holes in Indonesian Law, he was set free, as he had done crimes in other countries and not Indonesia. He had a safe haven in Indonesia.


Point No.15: Article in Newspaper “Todayszaman”, about fraud done the QuestNet in turkey.







Point No.16: Article in Newspaper “the Hindu” about fraud done by GoldQuest in India.





From the above mentioned facts, I am of the opinion, the fraud is very clear. I request the reader to circulate this information to maximum people though facebook etc, so together we can save people from giving away their hard-earned money.

I will forward a copy of this to Indian government offices, with the hope it reaches correct person who can take action against the company. I also request you to do the same if you have some special contacts in police or ministry of corporate affairs etc, i.e. if you personally know someone in such offices, you can talk and share the information.

If you come across someone who has already invested the money in the fraud and trying to bring in more people for his commission, try not to be harsh with them, perhaps they are also victims of the fraud.


I also get reasons from people that the Qnet is having valid income tax TAN/ PAN number in India, I again request you to not believe such things only because company is having TAN/ PAN numbers, as income tax department is duty bound to tax companies even if they are doing illegal business (Refer point 12 on "http://www.incometaxindia.gov.in/questionbank.htm").
Even if you take "supari" and kill someone, you can have Pan No. and file income tax return for the profit you made from killing, income tax department is duty bound to issue you a PAN card and accept your return, you can also claim deduction for purchase of weapon for killing :).
If you build a house on illegal land and pay house tax on it, your illegal construction does not becomes legal :).

Further operating scheme of business as Qnet does is illegal under federal India Act "The Prize Chits And Money Circulation Schemes (Banning) Act, 1978. Even participating in such schemes in India may land you in jail for a period of up-to to 3 years.

Useful links:


About me:
I am CA Sumit Navani. I am from Ulhasnagar, Mumbai Metropolitan Region, India.

You can contact me @,
And 
Jai Hind.