Be careful

You and I really need to be careful. Despite how skeptical some of us think we are, none of us is immune to the seductive charms of dubious money-making schemes. Yes, I DO mean pyramid schemes, amongst others. I’ve covered before the rather pathetic TVI Express pyramid scam. This is one of the many voucher-based pyramid schemes that is based on their silly holiday discount ploy. The “products” they claim to have are discounts against luxury holidays but they cover up the fact that a discount isn’t actually a product. A holiday can be a product but they are not offering you a holiday, they’re offering you a few percent off the price of a holiday. That’s not a product. That absence of anything tangible is what makes TVI Express a pyramid scheme and not it’s close relative, a Multi-Level Marketing scheme.

The good news is that eventually the enforcement authorities around the world have understood the real nature of TVI Express and that they need to do something about it. Some months ago the Australian Competition and Consumer Commission obtained orders restraining three individuals from promoting TVI Express and described is as “a pyramid selling scheme”. They have also come under the gaze of various authorities in China, Indonesia, Hungary and their home country of India. Most recently in September these crooks were shut down completely in the US state of Georgia. The bad news is that, just like cockroaches scurrying from underneath one rock to another when the light is shone upon them, many of the TVI Express conspirators and even some of their gullible victims are flocking to other pyramid schemes such as Pyxism.

Pyxism is a clone of TVI Express but I suppose that I should be cautious and say that I’m sure Pyxism is a legitimate fortune-earning mechanism that brings untold happiness and wealth to everyone it touches. Or perhaps, unlike the shameless, money-grubbing crooks behind all pyramid schemes, I should tell the truth. Pyxism is a pyramid scam just like TVI Express and you should avoid it like it’s a combination of the plague, the Ebola virus and swine flu. Pyxism is that good for you.

Meanwhile not all risks are as obvious as pyramid schemes. Some risks can be either just bad fortune or they come from a set of circumstances that allow things to go wrong. Just like allowing your house to become dirty and pest-infested will encourage disease, so too can companies allow things to become a little relaxed and mistakes can happen. I’m sure that this was the case with one of our latest problems. A reader contacted us and told us about the phone call he received from a company called Hotel Express International.

This is yet another holiday discount scheme that involves you paying some serious money to join a scheme that offers you discounted hotel stays and car rentals. However, things went seriously wrong during the phone call. Did the reader have a credit card he could use to join the scheme? No, he said, I only have a debit card. Not a problem said the saleslady, let me have your debit card number and I’ll just check to see if you are eligible to join the scheme.

OK, by now I imagine you can see the problem. Our bright, intelligent, worldly-wise reader has just given away his bank account to a total stranger.

The call ended with the saleslady offering to courier to the reader full details of the scheme and an application form to complete if he decided to join.

It came as a surprise to the reader, but not I suspect to you, that when he went to the ATM later that day he found his account near empty. P2,839.33 had been taken from it and the bank confirmed it was Hotel Express International who had snaffled his money. Unfortunately it was too late for the bank to stop it and, yes, he had voluntarily given them his debit card number. Yes, I know, you know and he knows that he didn’t explicitly give them permission to take his money but it’s too late, it’s gone.

When he got in touch with us we contacted the Hotel Express International people in South Africa and they did take pretty swift action. One of their senior manager people called the reader and did his level best to sell the benefits of the scheme, conveniently overlooking the fact that they had taken his money without his consent. It took a bit more persuasion before they conceded that it was time for a complete refund and no more funny business.

Regular readers will remember the problems we had with Prokard in South Africa when they dd almost exactly the same thing. In one case Prokard used the “give us your credit card details and we’ll check to see if you’re eligible for Gold membership” line. Same thing, same result. Money taken without explicit consent.

The supreme irony is that all these holiday and hotel discount schemes are based on a profound untruth. You don’t have to pay money or membership dues to get discounts. If you go to the hotel Express International web site you’ll see that in March they quoted the price for a suite at the Courtyard in Rosebank in Jo’burg at R1,050. By a strange coincidence I stayed in a suite at that exact hotel earlier this month and paid a mere R675. All I did was go to Bid2Stay.co.za and the discount didn't cost me a thebe, a cent or a penny. Certainly not P2,839.33 that Hotel Express took from an unwilling “customer”.

The lesson is simple and obvious. Don’t give your credit or debit card details to total strangers over the phone and don’t waste you money paying for something you can get elsewhere for free!

This week’s stars

• Sam at Naledi Motors Parts department or doing “an exceptional job”.