Accreditation scheme to clean up direct-sales sector

From left, Neo Kuon Huay, James Phang Wah and Jackie Hoo of Sunshine Empire; their practices got them into trouble with the law.

SINGAPORE - Direct-sales companies will be accredited as part of a new scheme designed to help clean up an industry plagued by complaints.

Those that sign up and pass the checks will be certified as trustworthy in an attempt to help consumers avoid rogue salesmen.

Unscrupulous direct-sellers have been known to trick housewives and the elderly into buying "magic rocks" that purportedly bring good luck.

Other scams include offering to fix their "dangerous" ceilings.

The scheme - announced on Wednesday - is a partnership between Consumers Association of Singapore and Direct Selling Association of Singapore (DSAS). It will be rolled out within the next nine months.

Certified companies must give their customers a seven-day "cooling-off" period during which they can change their minds, and must settle disputes with consumers through mediation sessions.

The companies will be put through a review process every two years which will involve mystery shopping checks by officials. They will be given the right to use a logo so that customers can identify them as a reliable company.

DSAS chairman Leo Boon Wang, 47, said the long-term aim is to get consumers to choose to do business only with firms on the CaseTrust scheme.

"This gives consumers the power to identify and choose reliable companies," he said. Nineteen of the DSAS' 22 members have committed to joining the scheme.

"Over time, the image of the direct-selling industry will be lifted," said Mr Leo. Twenty-four complaints against direct-sellers were received last year, mostly about pressure-selling and false claims.

Mr Zaheer Merchant, director of wellness company QNet, said accreditation adds another level of scrutiny, on top of rules already imposed by the DSAS.

"By joining CaseTrust, an independent body is coming in to verify us," added the 47-year-old. "In the current situation, we have stringent internal processes, but people tend to think they are malleable."

To get accredited, companies must be DSAS members and pay a fee, which has not been finalised. Housewife P. Raja Lachimi, 53, told The Straits Times that door-to-door salesmen had offered to repair her ceiling fan. "I rejected them," she said.

"Who knows what kind of job they will do? The new scheme will help me differentiate between good and bad companies."

But rogue firms can defeat the scheme by using the logo without permission, she said, and added: "They can find any loophole."

To prevent such fraud, consumers can check which has a list of the accredited companies.

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