A State prosecutor is among five people who have been arrested in the Western Cape by the Directorate for Priority Crime Investigation (Hawks) in connection with a well-known suspected pyramid scheme in which millions of rands were allegedly lost.
Hawks spokesperson, Captain Lloyd Ramovha, said in a statement on Friday that the suspects, aged between 38 and 62, were arrested by the Hawks’ Serious Commercial Crime Unit on Wednesday for alleged fraud amounting to millions of rand.
Ramovha said: “It is alleged that between 2009 and 2014 the suspects used bogus investment entities to recruit members of the public into joining their elaborate investment schemes by enticing them to purchase phoney vouchers ranging from R2700 to enable them to qualify for discounts on hotel accommodation, hiring of vehicles, flight tickets, and so forth.
“It is further alleged that ‘investors’ were encouraged to recruit more people under their names in order to receive more benefits, the same was advised to new members resulting in the scheme gaining popularity countrywide, in a typical pyramid scheme fashion. Known losses so far amount to millions of rand and are expected to rise as investigations continues.”
The group was released on warning and is expected to appear in the Bellville Specialised Commercial Crime Court on June 29 to answer to charges relating to fraud in contravention of the Banks Act and the Financial Advisory and Intermediary Services Act.