Wednesday, July 11, 2012

Scam Study: TVI Express

EDITOR'S NOTE: Scam Study is a quick summary of the various proven Ponzi or pyramid schemes. It is meant to be a summary, with relevant scam factor analysis. 


TVI Express "ATM Card", not really issued to any one
"TVI Express", also known as "Travel Ventures International", first appeared on the scene in 2009 in India, and claims combine three trends: e-commerce, home business, and travel. It is a convicted pyramid scheme around the world and is prosecuted in multiple countries around the globe as a pyramid scheme. Due to the way it operates in multiple countries, with server elsewhere, individual countries had to shut them down individually, leading to its continued survival. However, the scheme is mostly dead in 2012, except in the Philippines, where it still has many adherents.

Beginning of TVI Express

The origin of TVI Express is unknown, though its founder is believed to be "Tarun Trikha" (also spelled Parun Trika in some cases). He had previously appeared on various network marketing forums claiming he's new and wants to learn. Archived forum posts indicated that he had previously started various ventures, but none of them were much of a success and quickly expired, leaving no trace of their existence. He operates a "conglomerate" called V2Global, based somewhere in India.

Tarun Trikha came up with "Travel Ventures International", or TVI Express, in late 2008, and launched it in 2009, and he was very careful in crafting a facade of legitimacy through multiple layers of suggestions and vague wordings. It is clear he planned this for a while, as he crafted this scam the same way a spy agency construct a "legend" for its agents.

First, he registered a free membership with Travelocity Partner Network, which gave him access to the Travelocity backend, but with his custom front-end storefront.

Second, he registered a UK company through a registrar in Surrey, UK, and paid for either a mailbox or a virtual office in a prestigious address in London.

Third, he hired a decent web design team to make his website, and it is quite slick, with little if any bugs, and decent hosting. Though many of the pictures are cribbed from stock photo websites and even other MLM websites such as Xango.

Fourth, the adcopy inside the website are mostly cribbed from a book by Randy Gage, along with parts cribbed from ad copies of other MLM websites (in a similar style). One page used chopped quotes from Warren Buffet and Sir Richard Branson to "suggest" that TVI Express was partially or fully owned by these two celebrity investors when such a thing did not happen.

Fifth, it seems to be properly tested before launch, as few distributors ever ran into website problems.

Sixth, he created scripts and such for the "distributors" (i.e. members) to read for the videos, so people can create market videos by cutting and pasting some parts of his existing videos and add their own appeal to the audience.

Seventh, he probably established VOIP forwarding, and hired people who speak proper English, not people with heavy Indian accent, so affiliates didn't think they called India. It is unknown where is this call center operated from, but it certainly was not in UK. It is probably in India.

The result is one fancy marketing campaign that proclaims "you don't need to sell anything", and "you recruit two people, and teach them each to recruit two people, and you'll make money in your sleep", and "make $10000 per week". Different people will find different things they like, some like travel, some like money.

How TVI Express works

Schematic description of the expasion of the e...
Schematic description of the expasion of the eight ball pyramid scheme (Photo credit: Wikipedia)
TVI Express works by having you pay $250 + some fees to join the company as a "distributor" (despite its FAQ originally stated that "you don't need to sell anything"). Once you joined, you are issued an e-certificate that supposedly lets you redeem a 7-day 6-night trip for two and companion flight ticket. You also get access to a "back office" from which you can order trips, hotels, cars, etc. Finally, you are also entered into this 1-2-4-8 pyramid (they call it a 2x3 forced matrix, but it's same as the 8-ball scheme, shown to the right) with "bottom fill". As people join, they are pushed under you in the same level, and you move up as more people join. When the "traveler's board" is filled (i.e. full of 15 spots) you get $250 in your eWallet and $250 e-voucher that you can use to join again (buy another spot).   (yes, you can stack your membership), and you are cycled out and moved onto the "express board". The express board is another 1-2-4-8 pyramid composed of other people who cycled out. When you cycle out of the express board, you get $10000 in eWallet + $5000 eVoucher for some company training events. 

TVI Express managed to slip in a lot of different fine print, and it doesn't check its distributors for making bad presentations. For example, the trip redemption was virtually IMPOSSIBLE to do until mid-2010, 12 months after it opened. Furthermore, new fees are added to redeem the trip, and not all hotels and airlines are allowed. The list of participating hotels, resorts, and such is NOT displayed. You only find that after you joined, and it's NOT the same list as those available in the "backoffice" (i.e. Travelocity backend). Also, the payout is often represented as $500 and $15000 cash when they are not.

Out of India and Into China

The website took off in January 2009, and was first promoted in India. It initially had some problems in the Sikkim region, and was reported to the police as potential scam. Police ordered the company to refund 6000+ participants their money, and they sent in a lawyer with checkbook with no admission of guilt, claiming they were misunderstood.

In the meanwhile, it encouraged people to spread it to other countries, and a Korean quickly spread it to China by March 2009.

China at the time is just getting warmed up to direct selling, but MLM is actually ILLEGAL in China, as it had LONG experiences with pyramid schemes and such. Yet most people are just entranced with the fancy terms like "matrix" and such, and many translated versions (some are still online years later) shows that they are reinterpreting and embellishing company promotional ad copies, even claiming that TVI Express is international commerce and thus CANNOT be shut down by Chinese authorities.

Chinese bloggers started doubting the scheme as soon as April and May 2009, and some started posting detailed investigations of domain, backend, and more, determining that TVI Express is a hybrid pyramid / Ponzi scheme, and the entire "UK business" is merely a facade. When a newspaper picked up the story in June 2009, authorities stepped in and started to arrest "leaders" for defrauding the public. By September 2009 TVI Express virtually ceased to exist in China, as arrests were made all over China. Many were sentenced in 2010, and TVI Express made the "Blacklist" soon after.

Unfortunately, the scam had already spread across the ocean to many other continents.

TVI Express in the US

TVI Express reached US in late 2009, probably spread from China through Chinese American communities, and was picked up by local MLM promoters as the next big thing, on the heels of Cruise Matrix and similar schemes. Many MLM coaches picked up on this, and most reacted to it favorably, and only very few pointed to it as a pyramid scheme. Some even proclaimed it legal and profitable. Even MLM veterans with dozen years of experience can't see through the facade.

It fell to amateur scambusters to translate the articles from China, India, and elsewhere about TVI Express scam. And initially they were not believed, with shills trying every excuse under the sun, such as sour grapes, it paid me, and much more to discredit the critics.

All that was silenced when state of Georgia department of consumer affairs slapped "TVI North America", which is NOT an official branch, but just a bunch of distributors in the Atlanta area, with a "cease and desist" order, in August 2010. Though many TVI Express reps refused to accept the news, and later, only reluctantly gave up the scam, and some continued to blame their downline for being lazy and blame the US for "not MLM-friendly".

TVI Express in Europe

TVI Express reached Europe in 2009, but met large resistance, as law enforcement and newspapers have covered the scam quickly. An article in a newspaper on the Spanish island of Majorca appeared in 2009 and was one of the first coveage of TVI Express in Europe. There are also reports in Eastern Europe about defrauding locals. Hungary declared it a pyramid scheme in 2010 as well.

There are scattered people promoting, but they didn't meet much success. Though they moved East, into former Soviet-bloc countries where they are somewhat more welcome, though some were already weary of Ponzi schemes. Albania, for example, was rocked by massive Ponzi schemes that at one point soaked up 40% of national GDP.

TVI Express in Australia

TVI Express in Australia was primarily handled by "TVI Team Oz", a team of one guy and two girls. They were conducting various recruiting seminars throughout Australia and New Zealand until Australian consumer protection agency ACCC slapped them with a cease and desist as well as a lawsuit and a bank account freeze. The trio then defied the freeze by withdrawing smaller amounts from multiple branches, and ACCC slapped them with a contempt of court charge as well. The trio was found guilty of fraud in late 2011 and was severely fined in 2012. One of them tried to blame the government for not telling them it's a pyramid scheme.

TVI Express in Africa

TVI Express seem to have reached South Africa first, probably through Europe, then from there spread to surrounding countries like Namibia, Lesotho, Botswana, and so on.

Namibia was first to recognize the threat and its central bank issued a full warning in 2010 ordering the all participants to stop immediately. South Africa and Lesotho followed, and South Africa police actually made several arrests of top promoters.

As of June 2012, South Africa is still trying to track down just how much money went into the scam from South Africa by doing "forensic accounting". They expect the amount to exceed 1 BILLION Rands.

TVI Express hide-and-seek 

In mid 2009 TVI Express moved out of their office in the central London address. This may have been due to an investigation by a Chinese newspaper in UK. For several months, they existed only as a phone number and website.

A new UK office was not established until December 2009, and it's not even in London, but in Uxbridge (near Heathrow). It is also a virtual office, though there seem to be personnel there as they supposedly accept office visits if you make an appointment.

TVI Express then registered a new office in Cyprus (which is an island off Greece), which is also suspected to be a virtual office as it is shared with multiple companies. Rod Cook the MLM Watchdog believed that UK office of fair trade may have kicked them out or was just one step behind.

TVI Express in 2009 promised "local offices" in India, though it was not established until 2010. The offices were quietly shut in 2012, and travelled for "Elite Travel and Tour", which itself seem to have shut down by June 2012.

The UK company registration expired in early 2012 and was not renewed. Formal ties to TVI Express was never established. It is unknown whether the office is still leased or not.

TVI Express Spread into Southeast Asia and Middle East

TVI Express is documented to have reached Southeast Asia in early 2010, specifically Indonesia, where a local called Goernani Goenawan became the local head, and registered "TVI Express Indonesia" as a company. However, it is registered as a regular company, not a MLM company, and shows business of computer sales and consulting, not travel. It also seem to have received foreign investment from Tarun Trikha himself, but this was revealed much much later. Local members were very enthusiastic, and uplines are paying their downlines out of their own bank accounts instead of waiting for the eWallets to cash. Some even bought cars and posed next to them and use that as promotion. They were so successful, at one time they claim to have enrolled a provincial police chief. However, a local islamic Ulama council quickly determined that this is a scam, and declared it "haram" (unclean) and no Muslim should touch it, in 2010.

The local Direct Sales Association chapter APLI complained to government that TVI Express Indonesia is a MLM, but not registered as MLM or is a member of APLI. Goenawan responded by claiming that TVI Express is not MLM. This excuse was eventually rejected by the Indonesia Agency BKPM and the business license revoked in August 2011, and several TVI Express "leaders" in various Indonesia provinces were arrested for fraud.

2011 also saw TVI Express outlawed in Vietnam where government news reported issuing warning to all police stations to look out for this money scam.

TVI Express also reached Middle East and seem to be active in UAE, even though MLM is haram under Shariah law.

Current status of TVI Express

Current status of TVI Express is hard to come by, as news coverage of this scam has reached virtually zero. Occasionally there are still calls for justice in Indonesia, where many victims still held on to belief that TVI Express can be restarted (one such news was found July 4th on Antara News).

Philippines still seem to be gripped by TVI Express Mania. Earlier in 2012 a "convention" was held there complete with singers, dancers, "fashion show", and parade of top TVI Express "distributors" telling how easy it is to make money if you pay them. There were no reports or investigations by local Filipino media on TVI Express other than press-release type stories. On the other hand, there seem to be a lot of members who did their own research and concluded TVI Express is indeed scam by reading news out of US and Australia.

There had been no sightings of Tarun Trikha for a while. A raid by Indian police on his old headquarters in Bangalore India back in 2011 failed to find him. Though he was allegedly reached by South African newspaper and denied TVI Express is a scam. There were unverified reports that he is commuting between India and Indonesia trying to coordinate some new suspect scheme with Goenawan.

TVI Express has also spawned a ton of clones, many of which merely "refined" the model to be a little more legitimate. Many were even founded by ex-TVI members, some even borrowed the model by registering in far off places, like Hong Kong, Seychelles, Malta, and so on.

What were the warning signs of TVI Express?

The biggest warning sign about TVI Express was its own FAQ, where it declares "you don't have to sell anything".

If you don't sell anything, what are you getting paid for then? By recruiting more members, of course.

Yet its members invented multiple explanations to distract the issues, such as "it's a travel club", "it sells hotel vouchers", "it's a lifestyle company", "it gives out trips as promotions", and so on and so forth. The hybrid nature of this scam, with elements of both Ponzi and pyramid scheme, was used by members to explain why it is not one type or the other (when it is BOTH!)

When the domains reg were hidden, there was no listing of officers in the company, offices were virtual, stories were unverified and quotes chopped to make it appear as if a celebrity endorsed the company, it is clear this company was NOT an opportunity, but a scam with the FACADE of a legitimate company.

For further reading

TVI Express timeline from 2009 to present

TVI Express Scam in the News: articles from around the world

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  1. It's stunning I had no idea about all this until the moment I saw this article of yours. I also would like to ask you something about this blog. Do you own any valuable info about how to protect your blog entries from being used without your awareness about it?

  2. This comment has been removed by a blog administrator.

  3. is this true???????????????? i am a member!!!

    1. You haven't kept up, have you? Tarun Trikha was arrested in India a few months ago.

    2. this is definitely not are misinformed...

    3. He was arrested in April 2013. So what's your proof that I'm mistaken?

  4. where did you get your sources from? especially his name. parun trika and tarun trikha

    1. Google, and news articles. Specifically, the last link in the blog post, which links to them.

      Indian names are not always transliterated correctly, and multiple spellings of the same name exists. It gets worse when names were only spoken.

      You can check my other blog, which only tracks TVI Express scam.