By Annisa Essack
21:06:2021

South African siblings, Raees and Ameer Cajee, have done a vanishing act, along with Bitcoin with an eye-watering amount of cryptocurrency worth $3.6 billion from their investment platform known as Africrypt.  Bloomberg reported that around 69,000 Bitcoin was taken in the heist.

Investors smelt a rat in April when Bitcoin recorded substantial gains. The elder brother and Africrypt Chief Operating Officer Ameer Cajee informed clients that the company was the victim of a hack. He asked them not to report the incident to authorities. His reason was that it would slow down the recovery process of the missing funds. Investors were informed that client wallets and nodes were all compromised and that Africrypt was halting operations.

But sceptical investors roped in the law firm, Hanekom Attorneys, whilst a separate group began liquidation proceedings against Africrypt.

The law firm reported the matter to the Hawks and alerted crypto exchanges across the globe should any attempt be made to convert the digital coins after they failed to locate the brothers.

An investigation by the law firm found that seven days after the alleged hack, Africrypt employees lost access to the back-end platforms and calls to the Cajee brothers were directed to voicemail service. The company website is down.

Further investigation found that Africrypt’s pooled funds had been transferred from its South African accounts and client wallets. They were then put through tumblers and mixers (adding the coins to larger cryptocurrency pools) to make them almost untraceable. Commenting on the investigation, Hanekom Attorneys said it is not only Bitcoin that had disappeared from investors’ wallets. It also extends to swaps into other cryptocurrencies like Ethereum.

The heist of about 69,000 coins, worth more than $4 billion at their April peak, now represents the biggest-ever dollar loss in a cryptocurrency scam and could see regulators efforts to impose order on the market due to rising fraud cases.

According to a report by Chainalysis, Africrypt investors stand to lose three times more than investors involved in the Mirror Trading International collapse last year. The losses there involved about 23,000 digital coins, totalling approximately $1.2 billion.

South Africa’s Finance Sector Conduct Authority is also looking into Africrypt. However, it is prohibited from launching a formal investigation as crypto assets are not legally considered financial products.

The brothers had big plans to launch the first AI-driven trading platform in Africa, set up offices in Hong Kong and South Africa, and develop their hybrid blockchain to develop and launch the first African cryptocurrency token, Africoin.

Raees, 20, set up the company in 2019 and, it provided massive returns for investors. In the past year, Bitcoin has seen a surge in value. Details are now emerging about the extravagant lifestyles of the brothers. Family members allege that they are owed money from the scheme.

Zakira Laher, their cousin and former director at Africrypt, says that their family does not know the brothers’ whereabouts or the money. She says that although she was involved in the company, she drew no benefit and claimed that the company owes her money.

She added that the Cajee brothers “were living an extravagant, flashy lifestyle” that a start-up could not have funded.

Brandon Topham, the divisional executive for investigations and enforcement at Financial Sector Conduct Authority (FSCA), said people at the South African Reserve Bank (SARB) and South African Revenue Service (SARS) would be investigating this scheme.

Topham doubted that the story about Africrypt being hacked was true. He added that there was little chance of investors getting their investments back. But he was still optimistic that maybe the liquidators could be lucky.