I think you're probably right there. Here are moxie's comments on it: http://thoughtcrime.org/blog/telegram-crypto-challenge/

And here's a thorough trashing of their crypto: http://www.cryptofails.com/post/70546720222/telegrams-crypta...

I'm not a cryptographer either, so I can't comment on how accurate that last link is, but I tend to trust moxie, and if he thinks it stinks, well.....