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Defencex investors rubbish R1 000 claim

Cape Town – Defencex investors this week trashed claims that they forked out an alleged R1 000 to attend an Emotional Freedom Techniques "Feel Good" day held at Wits University on Saturday.

The meeting's agenda was given as "Motivational speaker, Laughter Therapy, Emotional Freedom Technique" and it was open only to Defencex investors with 10 points who had made a prior booking.

Chris Walker, the sole member of the close corporation Defencex, a trading name for Net Income Solutions, made a brief appearance.

“I must take issue with your comment that ’attendees reportedly paid an alleged R1 000 a ticket to hear Walker’s five-minute explanation of exactly what had gone wrong with his 2%-a-day investment initiative’,” wrote Fin24 user Keith Buncombe.

"This is totally false and creates the impression that the people who attended were ripped off.

“The requirement to attend was if you had 10 points you may make a booking and there is no further payment required (10 points equals R1 000 placed for the business opportunity and had absolutely nothing to do with the booking of a place at the hall).”

Another Fin24 user who attended the meeting, Xihluke Shivambe, said he can confirm there were not more than a thousand people present, because the Linder Auditorium can only hold a thousand and it was not completely full. “I’m a Wits student; hence I’m certain of this.

“And we most definitely did not pay a cent to attend the conference... it was free to members who had 10 points and above.”

Fin24 user Lindiwe Mokhobo echoed that only members who have more than 10 points qualified to attend the meeting. “We only ticked our names on a guest list and we did not pay the R1 000 you claim we paid.”

Defencex is the latest scheme to hit the headlines after the Western Cape High Court on February 28 ordered its bank account to be frozen because of its deposit-taking activities.

Only banks, collective investment schemes and brokers through a brokerage account are authorised to take deposits in terms of the Banks Act.

Members of the scheme invested up to R500m in Defencex. The Standard Bank account contained R320m at the time it was frozen.

The SA Reserve Bank has asked auditors PwC to investigate Defencex.

Defencex punts itself as an online investment company that allows you to "grow your profits by learning to compound your daily profits".

It promised investors about 2% per day on investments of five months' duration, subject to a complicated points-based assessment system. They could enhance these returns by earning commission on the amounts invested by people they in turn introduced to the scheme.

Analysts said the signs are clear for investors not to buy into a scheme like Defencex.

“Every time a scheme is exposed, people go through something similar to the normal five phases of loss – disbelief, anger, fear, negotiation, and then a very distant acceptance or resigning themselves to the loss,” said Daryl Ducasse, investor activist and member of Merkurius Capital Solutions.

"When promoters and companies use evangelism / religion as a central theme to their organisational ethics, I tend to run the other way. Not because I don’t think people should have faith or religion, but because it is used as a tool to deceive.

“I have seen this with Genesis, who used to open every morning’s activities with a prayer session; Realcor, where brokers, investors and some of the company’s employees used religion, or the deity God, as their (only) salvation and solution to woes, including court outcomes.

“This form of naiveté opens investors - usually elderly, wholesome people - up to abuse,” said Ducasse.

Dawie de Villiers, CEO of Sanlam Employment Benefits, concurred, saying that it seems that points of passion, such as religion, are being used to convince people to trust the operators.

"The signs that these schemes are not legitimate are very clear and similar among all of them: there are the points of passion; the returns promised are too good to be true and the schemes are not regulated or registered.”

Ducasse said Defencex’s promised of paying "2% per day" is not even economically possible.

“These types of schemes use the power of passion together with the power of high returns to influence the desperate, the poor, the uninformed – with BA rates as they are, people need a solution to survive.

“Sadly, these profiles of investor take their last capital and invest in the hope that it will turn out well – there is a name for this, and it is highly regulated – ‘gambling’.”

Investment schemes investors have fallen prey to include:

•    Masterbond;
•    Dividend Investments;
•    City Capital;
•    King Financial Services;
•    Blue Zone;
•    Pinnacle Point;
•    Genesis;
•    Sharemax;
•    PIC Syndications (not Public Investment Corporation) and
•    Realcor.

On Monday Defencex via its website thanked all members who had attended the Wits “Feel Good” day, adding “Chris was humbled by the fantastic reception that he received when he took the stage".

The post on cycle4dollars.com read: We look forward to many more events like this.

Defencex redirects to cycle4dollars.


 - Fin24
 
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