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Cape Town - The Hawks have put an end to a pyramid scheme operating out of Parow, Cape Town, which collected some R100m from unsuspecting members of the public.
The crackdown was in conjunction with the Financial Intelligence Centre and the Financial Services Board.
In a statement, the National Prosecuting Authority (NPA) said the Western Cape High Court had granted the Asset Forfeiture Unit (AFU) a preservation order amounting to R138m against the scheme, Platinum Forex, and its sole member, Colin Davids.
The NPA said the scheme collected money under the guise that it was a "lawful investor that invests in foreign exchange investments (forex)". It said investigations revealed the "unlawful business" took place during August 2013.
"The AFU alleges that the joint investigations with its partners revealed that, instead of investing the monies it collected, it used some of the funds received from the public for its own benefit.
False promises
"Platinum Forex also made false promises... that their so-called investments would yield interest returns of between 48% and 84%," said NPA spokesperson, Eric Ntabazalila.
However, he said, investigations showed that Platinum Forex also used some of the funds received from investors to pay other members.
But, said Ntabazalila, Davids allegedly also spent the money on:
- Two immovable properties in Plattekloof and Hermanus;
- Motor vehicles for his wife, Charlyn Anthea Davids - who is listed as the fourth respondent in court papers;
- Household expenses from retail stores such as Woolworths, Checkers and Pick n Pay;
"The freezing order will enable the curator bonis appointed by the court to keep the assets safe while the AFU prepares an application to forfeit the property.
"If the AFU is granted a forfeiture order, the curator will utilise the frozen assets to compensate victims of the scheme as it has done... in the past," he said, adding that the Hawks were also currently investigating criminal charges against the perpetrators of the unlawful scheme.
He went on to say that, according to court papers, Platinum Forex was not a public company which was lawfully allowed to provide financial services in terms of the FAIS Act.
