R5-coin schemers skip town and FSCA warns investors about Counit and Commex

2019-09-02 16:05
R5-coin schemers skip town

R5-coin schemers skip town

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Locals who invested their money in the R5 coin investment have become the latest victims of an alleged Ponzi scheme.

On August 9, The Witness reported on a R5 coin investment craze that saw hundreds of locals flooding the offices of the Ampex company — on the fourth floor of the Allied Building on Timber Street — to make investments.

Investors were selling the coins to the company and paying an admin fee of R1 200 for every R5 sold. In return the investors were promised a payout of R25 000 after 32 days for every R5 invested.

Speaking to The Witness, a local woman, who asked not to be named, said the company closed its doors the day after the paper published the article.

“Some people are saying they closed and ran because the Hawks came to their offices and were asking questions after the article, and some are saying that they were a Ponzi scheme and have finally decided to flee with our money,” she added.

The 50-year-old woman, who works as a cleaner, took out a R20 000 bank loan and invested over R18 000 with the company.

“I was hoping to make at least R200 000 from the investment and retire in peace.

“These people left and are not answering their phones. I am now left with a debt that I don’t know how I will repay.

“Things are also not good at home because my husband is furious about this,” added the woman.

All she has to show for her investment is a “blue card”, which she was supposed to use to claim her invested money.

The blue card.

“I started my investment with them in February but have never cashed out any money.

“Whenever I went to cash out my money, they always managed to convince me to carry on investing to get a bigger payout,” she said.

The woman added that she sees no point in reporting the matter to the police as they won’t help get her money back.

When The Witness visited the Apmex offices on Friday last week, the stairs and corridors, which were crowded with long queues of investors just two weeks ago, were empty.

The door to the Apmex office was closed.

A man who works at the building told The Witness that the Apmex employees were last seen on August 9.

He added that one employee had told him they were sorting out some issues they had with the SA Revenue Service (SARS) and would open again once that was done.

“People come here every day asking if we have seen anyone from Apmex. I really do hope these people come back with people’s monies,” he said.

Attempts to contact Sbu Zuma from Apmex, via the cellphone number he provided previously, were unsuccessful as the number went straight to voicemail. Other phone numbers on their various pamphlets also went straight to voicemail.

Pietermaritzburg police spokesperson Sergeant Mthokozisi Ngobese encouraged people to report all such matters to the police.

He said it was difficult to say what case would be opened as it depended on the circumstances of each incident.

Company stops giving Maritzburg woman monthly payout

In a separate incident, a Maritzburg woman is losing her patience with Dundee company Coinit Trading, which has stopped paying her monthly payout after she invested R280 000 with them.

The woman, who lives in Buffer, near Westgate, told The Witness that she decided to resign from the South African Police Service and use the lump sum she received to invest with the company.

She paid Coinit R280 000 to buy two trucks for her, the deposit for each truck being R140 000.

“I have a 36-month contract with Coinit. They are like the middleman because they are the ones who find companies that need trucks.

“I was told that my trucks transport coal for Eskom. Each truck makes a profit of R30 000 each month and half of this amount goes towards the instalment for the truck, the other R15 000 is paid straight to me.

“For the past 18 months I have been getting about R30 000 every month because I have two trucks.

“After 18 months the trucks should be paid off and I am expecting to start being paid R60 000 each month. When the contract is over, Coinit will buy the trucks from me for R80 000 each,” she explained.

The woman, who asked not to be named, last received a payment in June, and the lack of funds has forced her daughter to drop out of a chef school in Durban.

“It’s not only me who hasn’t been paid. Other people’s properties and cars are being repossessed because we’re all not getting [our money],” she said.

Commenting on several Coinit Facebook pages, investors raised concern about payments not being made and called the company a Ponzi scheme that had collapsed.

The Buffer woman, however, is not convinced the Coinit investment is a Ponzi scheme.

“I have a solid contract with this company and bank statements. When I called them to enquire about the payments, I was told that some of their employees were scamming them, so they did not have money to pay us.

“If they don’t have money they must just liquidate and pay us our monies,” she said, adding that she has consulted her lawyer on the matter.

The Coinit Trading company is affiliated to two other Dundee companies — CommEx and My House.

CommEx offers to sell minerals such as coal dolomite, iron ore and manganese to the public and help them sell it again for a substantial profit.

My House offers a five-year lay-by plan for a house. People can buy a 55-square metre house, excluding the property, for R3 335 000, and then pay R5 591,67 per month for a period of five years. The house is only built after the payments have been made.

FSCA warns the public about Coinit Trading and CommEx Minerals

Last Friday, the Financial Sector Conduct Authority (FSCA) — the market conduct regulator of institutions that provide financial products and services — warned the public to act with caution when dealing with Coinit Trading (Pty) Ltd and CommEx Minerals (Pty) Ltd.

In a statement the organisation said they have launched an investigation into the activities of the firms as they are suspected to be operating fraudulent schemes, with a high likelihood that clients’ investments may be misappropriated.

It said neither of the companies was licensed to conduct financial services nor to receive deposits from the public.

Two companies conduct business from a shared office based in Dundee and Coinit also has branches in Johannesburg, Vryheid and Newcastle, while CommEx Minerals operates in Durban, Johannesburg and Port Elizabeth.

“Mr Michael Andrew Anthony de Beer is the director of Coinit and Mrs Patricia Ursula de Beer is a director of CommEx Minerals,” the FSCA said.

“The public is once again reminded not to conduct financial services business with an entity that is not licensed by the FSCA and should be extremely cautious when offered unrealistic returns.”

Coinit’s attorney, Mello Shabangu, told The Witness that after consulting with his clients, they had decided not to comment on the matter.

WHEN a country is economically under pressure it creates a fear for the future, which makes people vulnerable to the false promises of fast-growing money schemes.

That’s the view of Kevin Fourie, a psychologist, who told The Witness: “There is a desire to try and assure stability and security for the future.

“There are two competing emotions that come into play, the emotion of fear and the emotion of greed.

“Fear is: ‘Am I going to have enough money to retire comfortably and will I be able to cope?’ This counterparts with greed, which says: ‘This offer’s an amazing opportunity and if this works, I will have a lot of money and will be okay’.”

Fourie said that when people convince themselves that the quick investment is brilliant, they don’t do their homework properly and desperately want to believe that what has been promised is true.

“The way Ponzi schemes work is that initially they use new deposits to recompense older deposits ... it looks as though its working, so you will be encouraged to invest even more because you’re doing so well, but ultimately it does come crashing down because it just can’t be maintained,” he said.

Fourie said it was possible for absolutely anyone to be scammed and had nothing to do with a person’s sophistication or level of education. “... It’s the greed that throws you off,” he added.

Dheran Ghela, a local financial adviser, said quick investment schemes were just “the tip of the iceberg”.

“There are plenty more out there taking advantage of an ill-informed public who desperately want to break out of the poverty cycle,” he added.

Ghela advised people to always deal with an authorised financial services company that is registered with the Financial Services Conduct Authority (FSCA).

“A company that’s not registered with the FSCA should set off alarm bells as they are not compliant with offering advice on investments or any financial advice.

“If they are registered with the FSCA, check what categories they are allowed to dispense advice on.

“People need to realise that there is no overnight get-rich-quick scheme. People need to educate themselves before entering any agreement ...” added Ghela.

Why do people invest on ponzi schemes?

When a country is economically under pressure it creates a fear for the future which makes people vulnerable to the false promises of fast-growing money schemes.

That’s the view of Kevin Fourie, a psychologist, who told The Witness: “There is a desire to try and assure stability and security for the future.

“There are two competing emotions that come to play, the emotion of fear and the emotion of greed.

“Fear is ‘Am I going to have enough money to retire comfortably and if I’ll be able to cope?’. This counterparts with greed which says, ‘This offers an amazing opportunity and if this works, I will have a lot of money and will be okay’.”

Fourie said that when people convince themselves that the quick investment is brilliant, they don’t do their homework properly and desperately want to believe that what has been promised is true.

“The way ponzi schemes work is that initially they use new deposits to recompense older deposits ... it looks as though its working, so you will be encouraged to invest even more because you’re doing so well, but ultimately it does come crashing down because it just can’t be maintained,” he added.

Fourie said it was possible for absolutely anyone to be scammed and had nothing to do with a person’s sophistication or level of education.

“The people that get caught are people who have a baseline of fear, but the greed aspect over rules that ... it’s the greed that throws you off,” he added.

Dheran Ghela, a local financial adviser, said quick investment schemes were just ‘the tip of the iceberg’.

“There are plenty more out there taking advantage of an ill-informed public who desperately want to break out of the poverty cycle,” he added.

Ghela advised people to always deal with an authorised financial services company that is registered with the Financial Services Conduct Authority (FSCA).

“A company that’s not registered with the FSCA should set off alarm bells as they are not compliant with offering advice on investments or any financial advice.

“If they are registered with the FSCA, check what categories they are allowed to dispense advice on.

“Investors need to deal with authorised financial services providers, who will give them advice based on their circumstances. Help them map out a proper financial plan to reach their goals.

“People need to realise that there is no overnight get rich quick scheme. People need to educate themselves before entering any agreement, use the media and the internet to learn. Financial literacy is very important,” added Ghela.

Read more on:    pietermaritzburg  |  ponzi schemes
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