FSCA fines Coenraad Botha from CBI X R216 million and debars him

The FSCA has fined Coenraad Botha from CBI X SA R216 million and debarred him for a period of ten years after it found in an investigation that Botha, CBI X SA and CBI Association contravened section 11(1) of the Banks Act.

According to the Financial Sector Conduct Authority, it imposed the fine of R216 051 141 on Botha because its investigation showed that there was no legitimate financial product or investment activity that generated the purported returns paid to investors by Botha and CBI entities.

Botha, through CBI X SA and CBI Association solicited investments from members of the public by promising unrealistic returns of 1% to 4% per week on the invested funds. He also calls himself a “cryptopreneur”.

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Botha arrested for same kind of alleged contravention in Namibia

According to the Namibian newspaper, Die Republikein, Botha and his Zimbabwean wife, Charlotte Murove, were arrested at Buitepos as they were fleeing Namibia two weeks ago.

They appeared in the Windhoek magistrates court on charges of contravening the Banking Institutions Act, the Prevention of Organised Crime Act and fraud. It is alleged that they scammed investors out of about N$160 million (R157 863 470).

According to the newspaper Botha denied that they were fleeing the country and said he was only on his way to visit friends in South Africa. Their legal representative, Afrika Jantjies, was arrested at the court for allegedly being their accomplice.

An investigation by Bank of Namibia allegedly showed that Botha, through his company CBI Exchange Namibia, accepted deposit from members of the public allegedly without having a license and authorisation to do so.

Kazembire Zemburuka, director for strategic communication and international relations at the Bank of Namibia, said in a statement that Botha’s actions were a contravention of section 6 of the Namibian Banking Institutions Act.  

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FSCA warns consumers to be careful when investing

The FSCA warns consumers to be careful when investing their money, as there are many fraudsters operating scams and the number is growing.

South Africans lose millions of rands every year to fraudsters, while the illegal operations are often well disguised as legitimate operations.

Red flags for scams include:

• unrealistic returns that are offered
• claims that the entity or person does not require an FSCA licence
• vague information about the investment product or the company that provides the financial product
• claims that the investor must act urgently and
• requirements to pay more money over to have their investment returned to them.

To avoid unnecessary risk, the FSCA says consumers should not accept any financial advice, assistance or investment offers from anyone not authorised by the FSCA to conduct financial services.

“Authorised financial services providers must display the fact that they are authorised on their documentation and explain what specific financial services they are licensed for. If this is absent, the public should avoid paying any funds to such a person without investigating it further.”