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Crypto-Currency Scam: South African Brothers disappear with Bitcoin worth $3.6b

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Digital money, Crypto Currency's Bitcoin

Two brothers from South Africa have disappeared with investors’ Bitcoins worth $3.6 billion dollars.

The duo, Raees Cajee, 20, the founder of the crypto company, Africrypt and his younger brother, Ameer Cajee, 17, who is the Chief Operating Officer, fled the country with the Bitcoins of crypto currency investors.

Africrypt is reported to be South Africa’s largest cryptocurrency exchange platform. It was set up by the runaway brothers in 2019. The platform witnessed an upsurge of investors as it promised outrageously mouth-watering returns on their investments.

According to Bloomberg, a Cape Town law firm, Hanekom Attorney, whose services were employed by the defrauded investors, reported the scam to the country’s police force known as the Hawks.

According to the report made by the investors, the fraudulent crypto currency website has been taken down by the fraudsters.

How trouble began:

Trouble began when suddenly, the elder brother, Cajee, informed investors using the platform that the company was hacked. However, the development became suspicious when he asked the investors not to report the matter to the authorities under the guise that such report could hamper the process of recovering the funds claimed to have been syphoned by the hackers.

According to the law firm, “We were immediately suspicious as the announcement implored investors not to take legal action.”

It said further that “Africrypt employees lost access to the back-end platforms seven days before the alleged hack.” Similarly, the law firm said the two brother can neither be found nor are their phone lines reachable. It said the phone lines went to voicemail whenever contact attempts are made to them.

To make their loot untraceable, the two brothers transferred the multi-billion Dollar Bitcoins from client’s wallets as well as their funds from South African accounts through Tumblers and Mixers to other large pools of Bitcoins.

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Meanwhile, a South African high court, Gauteng South High Court, has granted a temporary liquidation order against the two brothers and ordered them to appear before it to argue the liquidation order. The court gave them until 19 July 2021 to argue their case.

Similar scams:

Afrikrypt’s crypto scam has become the largest block chain theft in South Africa, with a recent fraud that occurred just few months ago. In 2020, another Bitcoin trader, Mirror Trading International, vanished with Bitcoins worth about $1.2 billion. The scam further spurred the South African government to mull banning crypto currency trading in the country.

Put together, the two crypto scams have robbed South African investors roughly $4.8 billion.

Celebrities, High-profile persons among victims of Afrikrypt’s scam:

Although no specific names have been made public yet, prominent celebrities and high-profile personalities in South Africa are believed to be among those reported to have fallen victims to the Afrikrypt’s scam.

According to a report by the law firm, its investigations showed that prominent celebrities and important personalities in South Africa also invested in the company which has now become a fraud.

The Cajees glamorous Lifestyles:

Raees and Ameer were known for their glamorous lifestyles which they often post on the social media to further lure their victims. They were known to always post extravagantly glamorous pictures of their lifestyles on social media where they would equally boast of mining over 100, 000 Ethereum from their computer systems. The Cajees would also boast to investors that they had garnered flawless pieces of experience in crypto currency trading and mining. This is believed to be one of the allurements that drew huge investors to Afrikrypt’s pool.

How much individual investors lost to Afrikrypt:

Many of the investors in Afrikrypt lost varying amounts of funds to the fraudulent investment. Analysis by Hanekom Attorneys revealed that while some of the investors invested as much as $1.5 million, a huge majority who invested at least, $100, 000 also saw their funds vanished into thin air.

Percentages and approaches offered by Afrikrypt to lured high-profile investors:

Afrikrypt lured its investors who are majorly celebrities and high-profile personalities by offering them mouth-watering percentages on their investments. The platform offered as high as 10% daily return on investments. It lured the investors to its huge pool under three investment approaches, viz: Conservative, Moderate and Aggressive approaches.

According to Hanekom Attorneys, “In the case of Africrypt, they were required to deposit funds into an FNB account which would then be used to purchase bitcoin, often on Luno. That bitcoin would then be broken up and mixed with other transactions to disguise the source.”

However, Luno’s General Manager for Africa, Marius Reitz, denied that the company had anything to do with Afrikrypt. According to him, “Luno consistently warns customers against sending any funds from their Luno accounts to high-risk crypto addresses. These addresses are identified by our transaction monitoring and analysis service provider, Chainalysis.”

Anthony Chinonso Ogbonna is an editor with Techuncode. He is a seasoned journalist whose stint cuts across broadcast, print and, especially, the online media. A graduate of Mass Communication from the University of Nigeria, Nsukka (UNN), Anthony holds a Masters Degree in Multimedia Journalism. He aligns his belief with those of world tech communities, holding tenaciously that the world is solely driven and can only be best with tech. Furthermore, Anthony believes that technology is simple, fun and is not what one, especially Africans, should be scared of, hence, his passion for telling compelling stories about tech in ways relatable to the ordinary user. He has his hobbies in reading and designing (new hobby though.)

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