Agel Vietnam, a member of US multi-level marketing firm Agel, has closed, leaving dealers with losses of VND6 billion (USD290,697).
Agel Vietnam’s headquarters at 73 Trang Thi have closed
This is the first time a multi-level marketing company has ceased its operations in Vietnam.
Bankruptcy
As a leader of a 20,000-strong Agel Vietnam dealer group, Chu Thi My Huong said her group members would lose a combined VND3 billion (USD145,348).
After the company filed for bankruptcy, Huong sent several petitions to Vietnamese authorities and the Agel holding company headquarters in the US. However, they replied that the sole responsibility rests with Agel Vietnam.
According to Huong, members of her group often exchange goods with each other. Now, with the cessation in operations, dealers would find it hard to buy products for other group members, compounding their losses.
Some students who had just joined the network paid VND15 million (USD726) in advance, now in severe trouble as they have no way of sourcing the products.
Ha Manh Cuong, a leader of another group, said he would join with other dealers to sue Agel Vietnam if the company makes no moves to offer compensation.
“My network involves nearly 200 people who have now suffered combined losses of around VND2.4 billion (USD116,279),” Cuong shared.
Agel Vietnam was established in 2008, at its peak during 2009-10 the network thrived with 50,000 dealers, but numbers had shrunk to 30,000 dealers in recent times.
Run away
An anonymous source close to Agel Vietnam’s management board said the situation has caused an estimated total loss of VND6 billion (USD290,697) for Agel\'s members and could lead to costly legal dispute as Agel Vietnam had received substantial amounts of money from its members, yet had failed to deliver the goods. The company also owed members commission that it had failed to pay.
According to Ms. Huong, Agel Vietnam’s Director Hoang Hai Yen should be held responsible. Yen was the legal representative of Agel Vietnam. She held a 10% stake with the US parent company owning a 90% share.
Recently, Agel Vietnam was licensed to become a wholly-foreign invested company. This would have affected the director’s position in Agel Vietnam.
Huong speculated that the management of Agel Vietnam deliberately ran the company into the ground so that they could establish or work for another company.
Authorities yet to be informed
Tran Anh Son, Deputy Director of the Ministry of Industry and Trade said the agency has yet to receive an official statement from Agel Vietnam regarding its filing for bankruptcy but had monitored the press coverage.
Son emphasised the importance of protecting consumer rights. According to the law, Agel Vietnam must be responsible for compensating for its traders.
Hanoi Department of Industry and Trade has to date only received a petition from a logistics firm who complained that Agel Vietnam owed them transportation fees, said the agency’s Director Luu Tien Long. He added that the department has yet to be officially informed about the firm’s bankruptcy.
