Undercover at New Pyramid Scheme that Vows to Make You a Million

We visit cult-like meeting to expose truth behind session which is urging Midlanders to cough up pounds

Sunday Mercury - Birmingham/February 24, 2002

A new pyramid selling scheme in the Midlands is persuading hundreds of people to pay pounds 1,600 each - with the promise of making them millionaires in less than a year.

Igennex Limited, a company formed last August, is enticing people to sign up at cult-like revivalist-style meetings held several times a week in Birmingham and the Black Country.

The Sunday Mercury was present at one session where more than 100 participants were told they could easily reap nearly pounds 33,000 in six months with little effort.

All they had to do is persuade family, friends and associates to attend the secretive meetings and then earn up to pounds 750 for each person who joins.

Members, which the company refers to as junior agents, are promised pounds 250 for each of the first two people they introduce, with the third signing promoting them to senior agent status - and earning them a further pounds 750.

Extra commission of pounds 500 is then paid for each of the first two people brought in by their new recruits - and then their first two new recruits in a repetitive chain.

In the three-hour meeting attended by our undercover reporter at Wolverhampton's plush Park Hall hotel, participants were told that the company had more than 2,000 members.

They were told to stand up and clap in unison to dance music anthems while awaiting the arrival of the sales team.

First up was representative Sue Mahmi who gave a 40-minute talk on the Igennex discount card scheme.

To ensure the pyramid scheme is legal, Igennex has to have a product for sale and ostensibly members are paying their pounds 1,645 fee to join the discount scheme for ten years.

It claims to entitle them to up to 70% off products ranging from holidays to cars and weekly shopping trips.

The 18,000 companies affiliated to the scheme are said to include Mercedes, Debenhams, Comet, Currys and B&Q.

But a simple call to some of the High Street stores by the Sunday Mercury revealed that none had ever heard of Igennex.

Members are told that they can only activate their discounts by contacting the Igennex Call Centre and quoting their membership numbers.

Our investigation revealed that the call centre is actually the company's advertised headquarters at Brindley Place.

Two agency telephonists take calls and divert them to Igennex staff... if you can ever get through, that is.

It appears that far from making massive savings at the point of purchase, the discount scheme has strict limitations including having to buy goods up to a certain value before being able to access the discounts.

Discounts may well be available but it would take years to recoup the huge membership fee.

The second half of the meeting, billed as the 'most exciting opportunity you will ever experience' is all about how members can make huge profits by selling memberships to others.

Guests are told that the rewards are so great after six months that they could easily afford to take a threemonth break in the Caribbean and still be making money. Participants are encouraged to shout and yelp in delight every time they are told how much money can be made through the scheme.

What they don't tell prospective members is that there is a fatal flaw. It needs a never-ending flow of new members to pay off all the people who have joined before them.

Our investigation also revealed that Igennex, which claims to be formed by 'visionary entrepreneurs', has employed Robert Fitzpatrick as head of marketing.

Its brochures claim that 'in 1996 Fitzpatrick achieved an enviable position of becoming a multimillionaire at the age of 26. Today he lives in the United Kingdom part of the year and the other part he divides his time between his other properties around the world.'

In fact, he lives in Burnley Road in Accrington, Lancashire - and far from being a millionaire, he is a bankrupt with debts of more than pounds 330,000.

In 1996 he headed a pyramid scam under the guise of Freedom International which recruited people through happy-clappy meetings similar to Igennex.

In 1997 Freedom International was closed down after a Department of Trade and Industry investigation and in February 2000 Mr Fitzpatrick was declared unfit to be a company director and banned from company directorships for 11 years.

Current Igennex directors are brothers James and Charles GrantParkes, who live in a palatial yet fortified home guarded by fierce Rottweiler dogs in Shatterford, near Bewdley, Worcestershire.

Charles Grant Parkes, 32, who also runs nursing homes in Birmingham, told the Sunday Mercury that Igennex was not a pyramid scheme.

'We are a discount club and people have made hundreds of pounds worth of savings with us,' he said.

'I can assure you that we are recognised by all the companies we list but we do use an intermediary agency to run the scheme. That is why some of the companies you called may not have heard of us.'

He added: 'We are not doing anything illegal and we are a professional outfit.

'We are aware of Mr Fitzpatrick's past but he has a skill and is good at his job.' Trading Scheme Regulations introduced in 1997 outlawedpyramid schemes with a new penalty of up to two years in jail for unscrupulous promoters as well as anyone who actually joins the scheme or attempts to recruit others.

The law makes it illegal for a 'promoter or participant in a trading scheme to persuade anyone to make a payment by promising benefits from getting other people to join the trading scheme.'

One disgruntled Igennex member told the Sunday Mercury: 'It is all very secretive and people only hear about Igennex through word of mouth.

'As a member, you are told to persuade others to join and you cannot go to a meeting unless you are a member's guest.

'You are promised all kinds of quick rewards and the contract is quite obscure with the terms and conditions hidden away.'

A spokesman for the Department of Trade and Industry said it was aware of Igennex and asked the Sunday Mercury to present the DTI with our dossier.

Birmingham City Trading Standards also said it was aware of the company and said our investigation had sparked further inquiries.