The cryptocurrency industry has recently witnessed one of the biggest crypto-related scams in its history from a pair of South African brothers.
According to a Wednesday report by Bloomberg, the brothers, Ameer and Raees, had made away with digital assets worth over $3.6 billion via their fraudulent crypto investment platform, Africrypt.
At the moment, the brothers are nowhere to be found and their digital assets cannot be recovered.
Ameer and Raees Cajee started the Africrypt investment platform earlier in 2019 and have provided its investors with bumper returns.
However, in April 2021, during bitcoin’s massive bull run, Africrypt investors were notified by the elder brother, Ameer, that the platform had been hacked.
Suspiciously, he implored them not to take any legal action at it will allegedly “slow down the recovery process of the missing funds.”
But a few investors who saw the action as very suspicious contacted the law firm Hanekom Attorneys, and another group of investors initiated liquidation proceedings against the investment platform.
In a preliminary investigation, it was discovered that the brothers had used mixers on the funds transferred from Africrypt’s account and clients’ wallets to obfuscate the movement of the funds.
Hanekom Attorneys said,
“We were immediately suspicious as the announcement implored investors not to take legal action… Africrypt employees lost access to the back-end platforms seven days before the alleged hack.”
Investors have tried calling the customer support mobile numbers provided by the platform, but the Cajee brothers could not be reached and the platform’s official website is down.
The law firm has reported the case to a special unit of the South African police force known as the Hawks. It has also spread the word to crypto exchanges all over the world to limit the chances of the brothers converting to digital currencies.
The Cajee brothers had managed to disappear with a total of 69,000 digital coins worth more than $3.6 billion.
Considering that cryptocurrencies are not officially regulated in South Africa, the country’s Finance Sector Conduct Authority (FSCA) cannot launch a formal investigation.
However, this recent scam could likely prompt the country’s financial regulators to impose strict regulatory requirements on the rapidly growing market amid numerous cases of crypto fraud.
Growing Crypto-Related Fraud
The new case comes shortly after the collapse of a similar South African Ponzi scheme known as the Mirror Trading International (MTI) last year.
In January 2021, however, the country’s regulators sought more authority to prosecute MTI’s officials.
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