Banxso’s offices were raided last week by officers acting on behalf of the joint liquidators who secured a search and seizure warrant from the Cape Town Magistrates Court on 12 December.
The joint liquidators obtained the warrant on the basis that there were reasonable grounds to suspect property and records were being withheld from them. Banxso was an online trading platform offering contracts for difference (CFDs), a type of high risk derivative where traders bet on whether an asset will move up or down in price.
Earlier this month, the Financial Sector Conduct Authority (FSCA) fined Banxso’s directors and key individuals a combined R2 billion, and the case was reported to the South African Police Service (SAPS) for criminal investigation.
ALSO READ: FSCA slaps Banxso and directors with R2bn penalty, refers matter to police
The penalties were imposed on Banxso and its directors, Harel Sekler and Warwick Sneider (Sneider resigned after Moneyweb first published negative articles on the company).
Also fined were former Banxso CEO Manuel de Andrade (R20 million) and former key individuals Mohammed Bux (R10 million) and Henry James Simpson (R5 million). All were debarred by the FSCA for periods of between 10 and 30 years.
The FSCA permanently withdrew Banxso’s licence in July this year after finding that it “and its key persons, inter alia, misappropriated client funds, provided false and/or misleading information to clients and to the FSCA, promised clients unrealistic returns and failed to act in the best interests of its clients”.
A Moneyweb investigation found that Banxso used fake social media ads, many of them featuring deep fakes on well-known personalities such as Johann Rupert, Patrice Motsepe and Elon Musk to promote automated AI trading platforms that could supposedly generate monthly returns of more than R300 000 on a once-off investment of around R4 700.
The company boosted its market profile by sponsoring Bafana Bafana and UFC star Dricus du Plessis.
Banxso claimed at the time that its system had been hacked, with leads illegally inserted into its IT system.
ALSO READ: The FIC busts Banxso
AfriMarkets, another company owned by Sekler, had its licence to operate withdrawn by the FSCA earlier this month on similar grounds.
According to Netwerk24, last week’s search and seizure warrant on Banxso’s Cape Town offices authorised officials to seize correspondence between Banxso and 13 companies named in the warrant, including AfriMarkets and Start Stream.
Banxso was placed in provisional liquidation in August.
A source with knowledge of the matter who asked not to be named told Moneyweb that officials from the sheriff’s office spent three days conducting the search and seizure, and carted away laptops, phones, documents, furniture and other movables. “They’re clearly looking for something of value, though I doubt they will find anything substantial.”
This article was republished from Moneyweb. Read the original here.
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