One of the most enduring pyramid schemes over the last decade or so has been that of TVI Express. Originating in India, TVI Express has slowly spread like a virus from continent to continent, sucking in new members to fund commissions paid out to existing members.
Using a reverse matrix compensation model, the commissions structure relies on a constant influx of new members being fed into a series of matrices so that a single member at the top can cycle out. Once this happens, the member at the top receives a commission and the process starts again.
Whilst the current status of investigations and action against TVI is unclear in Lesotho and Namibia, the South African Reserve Bank been making steady progress in their investigation, with some interesting developments recently coming to light.
Way back in December 2010, the South African Department of Trade and Industry announced that it was launching a criminal investigation into TVI Express after declaring it a “pyramid scheme”.
In April 2011 the South African Reserve Bank also announced an investigation. Attempting to divert attention from the fact that TVI Express was a pyramid scheme, TVI Express members immediately responded to the investigation announcement by declaring that anyone against TVI Express was ‘against black people becoming wealthy’.
Just a few days after the declaration attempting to use racism to justify the proliferation of a pyramid scheme, authorities swooped in and arrested local “owners” of TVI Express, Irvin and Gwenda Shirindzi.
TVI Express members at the time rallied against the authorities, declaring that ‘nothing will stop us from going ahead and investing in TVI Express’.
Following these arrests, things went quiet but recent announcements indicate that the Reserve Bank has been quietly continuing their investigation, moving up TVI’s South African membership hierarchy.
Attorney Kevin Kruger has led the Reserve Bank investigation and after investigating the scheme, has alleged that TVI has around 100 promoters (senior members) with one million South Africans invested in TVI ‘at any given time‘, and that
millions of rand (1 rand = 11.9 US cents) are being channelled through its bank accounts, mainly in transfers of R2 700 or multiplications thereof.
These amounts tie in with the “standard practice” in SA in that “investors” buy a block – equalling one voucher – on a traveller board for R2 700.
Kruger says the vouchers are worthless. And “investors” only make their money through advancing on the board through the recruitment of new investors.
Investigations have revealed that total credits received in various bank accounts of local distributors stand at R265m, with about R190m coming from “investor deposits”.
Targeting the assets of top promoters involved in the spread of TVI
Express through South Africa, the Reserve Bank’s investigation has led to the seizure of a number of top TVI promoter’s assets.
A small number of promoters however are challenging the seizure of their assets, with some even going so far as to claim the legislation banning pyramid schemes in South Africa is “unconstitutional”.
Other top promoters, such as Nonhlanhla Doris Hadebe, who promoted TVI through her co-ops ‘Change Your Lifestyle Network CC, Thrice Divas Trading Enterprise, Legend Venture and Club Wealth Wheels’, claim that she left TVI back in 2010 after learning of the involvement of ‘unscrupulous individuals within TVI‘ – TVI’s unscrupulous business model on the other hand didn’t seem to bother her.
These asset seizures happened earlier this year in March with court papers filed shortly thereafter and a series of cases due to be heard this week. How long the cases might take in court or whether or not the outcomes will be made public is currently unclear.
Seeing as the last time we heard any news out of South Africa regarding TVI Express was back in April 2011, it might be some time before further details regarding the Reserve Bank’s investigation come to light.
The South African newspaper that broke this latest development however, The Mercury, finish their article covering these latest events stating they understand ‘arrests are imminent‘.