• Report: #107080

Complaint Review: Inflexion

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  • Submitted: Sun, September 05, 2004
  • Updated: Sat, September 25, 2004

  • Reported By:Piscataway New Jersey
Inflexion
645 Griswold Street, Suite 1800 Detroit, Michigan U.S.A.

Inflexion ripoff startup Norvergence clone dangerous to customers Detroit Michigan

*UPDATE EX-employee responds: Don't avoid the subject

*Consumer Suggestion: Inflexion is Nothing Like Norvergence

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As one of the best salespeople at Norvergence, I was recruited to be a significant part of the original Inflexion team. I have a lot of information and I'll endeavor to put it all down here.

First of all, everyone dealing with Inflexion should know all about Norvergence, one of the major scams of the year (read about it on this board). At Norvergence, you had to APPLY for the service, which included unlimited local, LD and cellular, plus a phone system. It all sounded great -- until Norvergence didn't pay it's carrier bills and went bankrupt.

What Norvergence was REALLY doing was renting a useless box to the customer for a very high amount of money, and then charging little or nothing for T1 and cell usage. They would then sell the rental agreement's income stream to a financial company (GE Capital or Wells Fargo) and simply pay the customers' bills. However, when Norvergence went out of business, the customers STILL had to pay those leases and ALSO pay retail for their T1s and usage. Major lawsuits are pending.

When Inflexion called me, I told them I would under no circumstances get into that situation again, and I would not rip off a customer -- they assured me this was not the case, that they were different, and that they were fully legit. I accepted the position, and we booked a meeting with myself and a slew of other former Norvergence players to meet my new management.

First, I looked up my new bosses, Dwayne Goldsmith, Dan Berninger, and Keith Machen. It turns out they once ran a company called Ntegrity that -- tell me if this sounds familiar -- went bankrupt after failing to pay its carrier.

Apparently they refused to pay their debt and sued Verizon to release them from a $4M debt for unspecified "antitrust issue". and Ntegrity went out of business. When I asked them about Ntegrity, they told me they actually WON the lawsuit, but I found no evidence of this on-line

talking about a great conspiracy at Verizon to "get" Keith). I found it odd that they would "win" such a major lawsuit, yet there would be no evidence of this (indeed written evidence to the contrary), and that Ntegrity no longer exists. I got scared and asked more questions.

Inflexion is a Norvergence clone, made up of Dwayne, Keith, Daniel, and a whole bunch of former Norvergence sales execs. Their plan is the same as Norvergence. They will make you APPLY to get their system which includes a very cheap T1 and an IP-PBX, with unlimited domestic calling and possibly high-usage cellular phones. They will take your total phone bill, take off a percentage (about 20%), and this new number will be your total amount paid each month (that's why they collect your bills and can't give you numbers without them).

Most of that new payment will be the rental agreement of the phone system, which Inflexion will sell to a finance company. Inflexion will get a large lump sum from the finance company in exchange for this uncancellable revenue stream. The rest of the customer's charge will be below-retail amounts for T1s and other services.

THE CATCH is the same as Norvergence. If/When Inflexion goes belly up (like Norvergence and Ntegrity), customers will be required to pay the same rate for the phone system rental AND FULL REGULAR PRICE FOR THE T1 AND SERVICES. The rental agreement will be non-cancelable, even in the event that the service goes away. This is what happened to the thousands of unfortunate Norvergence customers.

Another problem is that they are not a reseller per-se, but an aggregator. They buy transport in bulk and send it over their private network. All customer T1s go to the Inflexion switch, which then sends it out over their carrier. If they don't pay their bills, the carrier can turn off their whole network, and customers' phone services go dead. This also happened with Norvergence.

Obviously, we did not move forward and I did not work for Inflexion after that day.

They didn't like my suggestion that they pre-pay all the services (including the T1 and cellular), thereby insuring that the customers would not be ripped off if IFXC went bust. Hopefully, by posting this report, they will be forced to take this action and run a safe and completely legitimate business. However, even if they tell you it's safe and that they have paid for everything in advance (which I highly doubt since they hated the idea), be sure to get the receipt for the prepaid T1 IN WRITING FROM THE CARRIER -- not from Inflexion -- for the FULL TERM OF THE RENTAL.

Norvergence boldly lied to its customers, and Inflexion is using the Norvergence sales force veterans. When dealing with Inflexion, use your gut, don't take double talk, don't be worried about "not being approved", and get every single little thing in writing, especially the guarantees. Read about Norvergence on ripoffreport, and if Inflexion doesn't promise to prepay the T1 and Cellular bills for the full term with receipts from carriers, consider yourself open for a ripoff.

My strong recommendation is just to look for the best deal you can get from a legitimate company that's been in business for more than a few months and that has lots of local references.

David
Piscataway, New Jersey
U.S.A.

sorry, allowing you to give a competitors name would instigate others to just file against their competition, to only come back later to suggest their company your comments on this policy are welcome! CLICK here to see why Rip-off Report, as a matter of policy, deleted either a phone number, link or e-mail address from this Report.

This report was posted on Ripoff Report on 09/05/2004 06:15 PM and is a permanent record located here: http://www.ripoffreport.com/r/Inflexion/Detroit-Michigan-48226/Inflexion-ripoff-startup-Norvergence-clone-dangerous-to-customers-Detroit-Michigan-107080. The posting time indicated is Arizona local time. Arizona does not observe daylight savings so the post time may be Mountain or Pacific depending on the time of year.

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Updates & Rebuttals

#1 UPDATE EX-employee responds

Don't avoid the subject

AUTHOR: David - (U.S.A.)

Yeah, That's what the Norvergence execs did with their on-line detractors: Insult them, threaten to sue, and above all avoid the subject of the attack in the first place

I'm not here for a fight. In fact, I am not going to post after this one. I've got better things to do, and so do you, Keith.

But before I go, let's get a few facts straight:

--1 ) I said Ntegrity (A facilities-based CLEC run by Keith, Dwayne et al), went out of business and you said Ntegrity has not gone out of business and that I grossly misstated the actual events and facts, stating there was a successful settlement.

OK. I invite readers to find out for themselves as to how business is over at Ntegrity, after successfully settling their lawsuit. Start with a Google search (look for the telecom company based out of MD, not the consulting company in CA). Here's a few clippings I found (I edited them for space you'll find the whole articles online)

First, the "successful" lawsuit settlement
(Begin article)
Trenton, NJ, August 13, 2002 - The U.S. District Court here last night dismissed an antitrust case filed against Verizon by Ntegrity, a reseller of Verizon local telephone service in New Jersey and other states.

Ntegrity brought the antitrust case after Verizon sued to collect past-due bills totaling $4 million owed to Verizon by Ntegrity. The court also denied Ntegrity's motion to dismiss the Verizon suit for payment of past-due bills.
(snip) (end article)

Next, the question of the company's condition
(begin article)
February 14, 2003 Pa. agency fines Ntegrity $400,000 for violations
The Pennsylvania Public Utility Commission fined Ntegrity Telecontent Services Inc., formerly of Baltimore, $400,550 for illegally switching 27 customers from another telephone provider to its service in 1998 and 1999.
(snip)
Ntegrity Telecontent Services was based in Baltimore before vacating its offices in 2001.
Officials with the company, which had to cut off service to at least 12,000 customers in October 2001 because it did not pay Verizon Communications Inc. $4 million in fees, could not be reached for comment
(end article)

And here's one segment of a 3/00 press release with a major cell phone manufacturer I included just to link Dwayne with Ntegrity when the company had its problems (I felt that by saying a company that Inflexion executives are no longer associated with Keith implied there was no link)

"Ntegrity's community-oriented suite of voice, video and data products (blabber snipped)" said Dwayne Goldsmith, Ntegrity President and CEO.

Again, readers should read up, because it's important. I mean, if cutting service and vacating offices indicates a successful settlement to Keith and company leadership, I wonder what an unsuccessful settlement would have been.

--2) Keith says Inflexion is nothing like Norvergence

Well, I wouldn't say nothing. Inflexion leases out equipment with hell or high water leases and then sells the leases (right?). They include SEPARATE service agreements for unlimited usage and below-market-cost T1s to go along with the equipment leases (right?). They make companies apply for the solution, including a credit application (right?).

And lets not forget the same major CATCH as Norvergence which was the major point of my first post but you forgot to address in your tirade. I'll explain it again.

Ntegrity was a facilities-based CLEC, just as Inflexion is. Ntegrity (apparently) cut off service to at least 12,000 customers and vacat[ed] their offices after the court denied Ntegrity's motion to dismiss the Verizon suit for payment of past-due bills -- all under the SAME LEADERSHIP as Inflexion.

Same business, same leadership. Got it? Given the condition of the market, I think concern for the longevity of the company is valid.

If it does happen again (for whatever reason), we know from Norvergence that customers will be stuck paying a very high price for their PBXs alone, AND RETAIL PRICES (no more subsidized services and facilities) for their T1s AND per-minute charges for their service. (Like NorvergenceRIGHT???)

Keith, I am not your enemy. I want no fight. I want Inflexion to be the ethical company it could be, because I believe the model CAN work ethically IF AND ONLY IF...
Inflexion guarantees service with another carrier in the event Inflexion goes belly up for the remaining term of the binding lease, or
Inflexion places a release clause in the lease that allows the customer to terminate the lease if Inflexion service is terminated

That's it! No more! That's all you need to do.

Yes, it will cost money, but you and the customers will both benefit. Inflexion will get more customers, and customers will all be covered. And, it will all be ethical.

And that's it. I'm finished. No more posts. If you want to challenge my integrity or threaten to sue me again, go ahead. My job here is done.
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#2 Consumer Suggestion

Inflexion is Nothing Like Norvergence

AUTHOR: Keith - (U.S.A.)

The Norvergence debacle was truly a very unfortunate situation that had many victims. It appears that in addition to mismanagement and possible fraudulent activity on the part of Norvergence management other 3rd parties either unwittingly or more troubling willfully participated in the Norvergence scam. The Norvergence scam could not have been pulled off without either the recklessness or the complicity of the leasing companies that financed these nebulous deals. Despite David's endeavor to put it all down the facts are clear, simple, and totally contradictory to David's assertions.

Inflexion was approached by dozens of ex-Norvergence employees seeking employment. Hundreds if not thousands of Norvergence employees had their last pay checks bounce and we were informed that sales commissions were not paid for the last several weeks of Norvergence's existence. At our own time and expense we brought in ex-Norvergence sales people and others. After thorough review and vetting only a select few of ex-Norvergence people were offered positions. One of the primary screening criteria was integrity and ethics. David was one of the applicants who did not make the grade. His attempt to defame Inflexion is simply sour grapes.

Inflexion could not be more different than Norvergence was.

Norvergence sold a a low cost ATM device that offers few enhanced features or functionality, nor does it enable VoIP as Norvergence advertised. The cost of this box is less than $1,500. Norvergence did not add any value to the equipment before delivering to the customer. Inflexion sells an integrated IP PBX system that includes significant processing power and memory. Furthermore, Inflexion has developed several software applications that differentiates our application from others.

The Norvergence equipment did not work with network providers other than Qwest. Inflexion's equipment works with multiple other network providers.

Norvergence financed the services portion of their offering in with the low cost equipment lease. Inflexion has a separate service agreement with the customer.

Norvergence was not a facilities based phone company. The network charges Norvergence quoted to customers were unrealistically low, and would never have been achievable by Norvergence. Inflexion is a facilities based phone company. We are interconnected into the Public Switched Telephone Network. Inflexion can and does have network costs that allow us to truly quote and deliver substantial network discounts to our customers.

David's case against Inflexion is so weak that he has to falsify information regarding a company that Inflexion executives are no longer associated with. Once again, David has grossly misstated the actual events and facts. The true facts are:

Ntegrity never filed for bankruptcy
Ntegrity has not gone out of business
Ntegrity's investors did consider the settlement of the Verizon litigation a successful settlement. In fact Ntegrity's lead investor initiated and negotiated the settlement with Verizon.

Inflexion plans on pursuing all of its appropriate legal avenues to pursue individuals and entities that misstate facts in an attempt to criticize and detract from Inflexion's business pursuits.
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