Photo Credit: Bangkok Post
The iCon Group has garnered significant attention following numerous complaints from victims, with estimated losses exceeding 2.4 billion baht. The Police Central Investigation Bureau has issued arrest warrants for the group, accusing them of public fraud and submitting false information into a computer system.
Additionally, the iCon Group faces allegations of operating as a pyramid scheme by focusing on recruiting new members rather than selling products and services.
The case has drawn heightened scrutiny due to the involvement of three celebrities—TV host Kan Kantathavorn, Peechaya “Min” Wattanamontree, and Yuranunt “Sam” Pamornmontri—who were engaged as product presenters and received substantial payments. Some victims reported that they invested in the iCon Group due to their admiration for these celebrities.
Pyramid and Ponzi schemes have existed in Thailand since the early days, with the first recorded case being Share Mae Chamoy in 1989. To help raise awareness about these schemes, the Office of Innovations and Social Missions at Kasetsart University organized a forum titled “Modern-day Pyramid Schemes: Why Do People Still Fall Victim?”
Lertsak Raktham, director of the Office of Consumer Protection Board (OCPB)’s Legal Execution Division, noted that many individuals are lured into Ponzi schemes because scammers promise quick returns on short-term investments.
“If someone guarantees a 100 baht return on your 1,000 baht investment within a week, it’s likely a scam. No genuine investment can deliver such rapid and substantial returns. Companies offering returns that exceed legal limits violate Section 4 of the Emergency Decree on Borrowing concerning Public Cheating and Fraud, which constitutes public fraud,” Lertsak explained.
He also mentioned that Ponzi schemes typically attract participants by promising attainable wealth and an extravagant lifestyle. “These companies often showcase images of wealth and success, featuring stacks of cash, luxury cars, opulent homes, designer goods, and glamorous travels,” he stated.
Due to recent media coverage of the iCon Group, public perception of direct selling companies has soured. To differentiate between legitimate direct selling firms and pyramid schemes, Nadhakan Shinnaranantana, head of the Department of Marketing at Kasetsart Business School, clarified that direct selling companies prioritize product sales, while pyramid schemes focus on recruiting new members.
“Legitimate direct selling companies provide products that are well-known to the public and maintain warehouses for inventory, though distributors don’t need to stock products themselves. Registration fees are typically reasonable, and new distributors receive sales manuals and product samples, along with training,” Nadhakan explained.
“Incomes for direct selling distributors come from actual product sales rather than recruitment. Business operators must present a compensation plan to the OCPB for review and approval. Thailand has over 600 registered direct selling companies with only about 5% of distributors achieving success. Conversely, pyramid schemes often impose high registration fees, focus little on product quality, and have no return policy for distributors,” Nadhakan added.
“As a reminder, all investments carry risks. The Securities and Exchange Commission advises consumers to carefully assess all aspects before making investment choices. Scam companies often encourage downlines to purchase positions and recruit new members as a means of generating income,” he concluded.
Asst Prof Thanasin Tanompongphandh, chairman of the Faculty of Economics Center for International Affairs, pointed out that the iCon Group experienced significant growth post-COVID-19, coinciding with widespread unemployment and a search for new income opportunities. According to company reports, 2021 marked the peak of their profitability, earning 4.95 billion baht with profits of 813 million baht, compared to 378 million baht with profits of only 9 million baht in 2020.
Incentives to recruit new members include retail prices set at 2,500 baht and wholesale options at 25,000 or 250,000 baht, allowing distributors to potentially earn large profits. The iCon Group features various ranks such as Boss, Emperor, Royal Crown, Crown Dealer, and Wisdom Dealer, which serve to elevate social status and motivate recruitment.
Nadhakan noted that celebrity involvement greatly impacts public interest. “Celebrities play a crucial role in attracting fans to become distributors, often without evaluating the quality of the products because they trust the celebrity’s endorsement,” he commented.
Asst Prof Thanasin urged caution: “This situation serves as a critical lesson for celebrities endorsing products. They should conduct thorough scrutiny of the products they promote.”
Surakij Singhapol, a legal and case officer at the Thailand Consumers Council, emphasized that the investigation must focus on the celebrities in high-ranking positions within the organization, as they possess crucial information.
“Police must gather significant details from upper management and examine lower-level employees for consistency, ultimately identifying any legal violations committed by the iCon Group,” Surakij noted.
If anyone has fallen victim to a pyramid or Ponzi scheme, Surakij recommends filing a fraud report at a police station as a first step for compensation, advising victims to.
