ScamTelegraph reports that South Africa's Department of Trade and Industry officially declared TVI Express a pyramid scheme on December 29, 2010. The department announced it would launch criminal proceedings against the company and its distributors, confirming a police case had been opened with the SAPS Commercial Crime Unit.
The Department of Trade and Industry confirmed it had initiated a police case against TVI Express for "operating a prohibited Pyramid Promotional Scheme." Sidwell Medupe, a spokesperson for Trade and Industry, stated the matter was reported to the SAPS Commercial Crime Unit in Durban in September for further investigation and prosecution.
The scheme was found to contravene Notice 1135 of 1999, which was promulgated under the provisions of the Consumer Affairs (Unfair Business Practices) Act 71 of 1988. South Africa's Consumer Affairs Act explicitly prohibits individuals from directly or indirectly promoting or knowingly joining, entering into, or participating in pyramid schemes where compensation is primarily derived from the recruitment of other participants.
TVI Express has not issued any response to the allegations or regulatory actions taken against its operations in South Africa. The company has ceased its activities in the country, leaving individuals involved with the risk of criminal prosecution.
Bongi Ngomane, a South African TVI Express member, told the media that Parun Trika, identified as the scheme's owner from India, had disappeared, and the website used for purchasing vouchers had been closed. Ngomane reported attempts to contact Trika through the main communication line received replies indicating the scheme was on hold for virtual office verification.
The lack of official response from TVI Express, coupled with the closure of communication channels, suggests an abandonment of operations in South Africa. The notion of "verifying" virtual offices, which lack physical locations, raises questions about the true reasons behind the company's sudden halt in the country.
What action did South Africa's Department of Trade and Industry take against TVI Express?
South Africa's Department of Trade and Industry officially declared TVI Express a pyramid scheme and announced its intention to launch criminal proceedings against the company and its distributors. A police case was opened with the SAPS Commercial Crime Unit.
Why was TVI Express deemed illegal in South Africa?
TVI Express was found to be operating a prohibited Pyramid Promotional Scheme, contravening Notice 1135 of 1999 under the Consumer Affairs (Unfair Business Practices) Act 71 of 1988. The scheme's model relied primarily on recruitment for compensation rather than legitimate product sales.
How did TVI Express respond to these allegations?
TVI Express did not respond to the allegations and has reportedly abandoned its operations in South Africa. The owner, Parun Trika, is said to have disappeared, and the company's local website has been closed.