The Malta Financial Services Authority (“MFSA” or “the Authority”) has become aware of an entity operating under various names, including DistributeX, distributex, DistributeX Limited, DX Distribute or DX and other similar variations. The entity maintains an online presence through the website https://distribute-x.com/, as well as through mobile applications, including ‘DX-Plus’, which is available for download from the Apple App Store. The Authority notes that the entity appears to conduct its activities from a number of offices situated in different localities across Malta, including Birkirkara, Hamrun, Mosta and Hal Tarxien. The Authority further notes that the entity appears to be inviting members of the public to attend gatherings organised in Malta described by the entity as an “official employee meeting”.
The Authority wishes to inform the public that none of the entities operating under these names, or any variations thereof, are registered as a company in Malta, Furthermore, the entity and/or any individuals, representatives, or promoter groups operating under this name are not, and have never been, licensed, authorised, regulated, or otherwise approved by the MFSA. Accordingly, they are not permitted to provide financial services or carry out any activity that requires authorisation under Maltese law.
The Authority has identified certain features in the entity’s business model that appear to resemble characteristics commonly associated with multi-level marketing ("MLM") arrangements and may also exhibit elements that may be linked to pyramid schemes. In particular, the Authority observed that participation requires an upfront financial contribution; members are incentivised to recruit new participants through referral-based commissions; and the platform promotes the prospect of earning returns through a structured membership programme. These features are among those highlighted by the MFSA in its public warning on pyramid schemes posing as MLM arrangements - (https://www.mfsa.mt/news-item/mfsa-warning-pyramid-schemes-posing-as-multi-level-marketing-businesses/).
While the existence of these features does not, in itself, establish that the operation constitutes an illegal pyramid scheme, they are commonly associated with business models that may pose significant risks to consumers. The Authority therefore strongly encourages members of the public to exercise a heightened degree of caution and to carefully assess the associated risks before committing funds or participating in such arrangements.
The MFSA would like to remind consumers of financial services not to enter into any financial services transaction unless they have ascertained that the entity with whom the transaction is being made is authorised to provide such services by the MFSA or another reputable financial services regulator. Financial regulations oblige licensed businesses to comply with strict legal requirements in the interest of investors and the markets. The activities of unlicensed entities are unregulated, making transactions with such entities risky for consumers.
A list of MFSA licensed entities is available and can be viewed on the official website of the MFSA at https://www.mfsa.mt/financial-services-register/. For more information on financial scams please refer to the MFSA scam awareness document to keep yourself informed on red flags which help consumers of financial services to identify such financial scams.
