The Coin-It Trading debacle has left numerous individuals devastated after it was revealed that the company operated as an intricate Ponzi scheme. The revelation has led to widespread disillusionment among investors who had placed their hopes and financial futures in the hands of the company.
Newcastillian News first reported on Coin-It in December 2020, highlighting the precarious situation faced by Raphah Ministries. The NGO found itself on unstable ground as the premises it occupied were owned by the proprietor of Coin-It Trading.
Coin-It Trading, marketed as an investment scheme, faced liquidation by the Pietermaritzburg High Court following a wave of investor inquiries and growing suspicions about its operations being nothing more than a Ponzi scheme.
Allegations surfaced suggesting that the company enticed clients with the promise of an exceptional investment opportunity, guaranteeing returns of 200% within a mere three years.
Investors were required to make a one-time deposit for equipment and were assured of monthly profits derived from the use of said equipment. However, these promises proved to be empty, leaving individuals desperate to recover their investments.
The Asset Forfeiture Unit (AFU) intervened in response to the growing outcry, launching an investigation and taking decisive action against Michael de Beer, the mastermind behind Coin-It Trading.
The AFU’s relentless efforts led to the seizure and liquidation of the company’s assets and properties valued at R106 million.
Prior to the AFU’s intervention, the Financial Sector Conduct Authority (FSCA) had already expressed deep concerns about Coin-It Trading. The FSCA initiated its own investigation, suspecting fraudulent activities and potential misappropriation of clients’ investments.
To read more, click here.
In a statement issued at the time, the FSCA revealed, “This comes after the authority was made aware that these entities are offering investment packages to the public. Furthermore, these investment packages promise what appear to be unrealistic returns. The FSCA wants to make it clear that neither of these entities are licensed to conduct financial services nor to receive deposits from the public.”
Coin-It Trading, with its offices spread across Johannesburg, Vryheid, Newcastle, and Dundee, came under the authorities’ radar, eventually leading to the AFU’s intervention and subsequent actions against de Beer. Investors, hopeful for justice, as many had invested their life savings and even taken out loans, awaited the resolution of the case while their lives were left in ruins.
Progress in the case was sluggish, leaving investors desperate for some form of restitution. Finally, in a glimmer of hope, Coin-It Trading was officially liquidated.
In March 2022, Newcastillian News reported that de Beer’s attempts to appeal the legal proceedings were swiftly dismissed by the High Court. The court affirmed the original forfeiture order, granting liquidators the authority to dispose of the assets, which would come into immediate effect.
Apart from the properties, vehicles, and a light aircraft, the liquidators also identified shares in four companies that would be sold to repay the necessary creditors and Coin-It investors. Shockingly, the liquidators discovered payments totalling R548 million and R7.15 million made to these companies, allegedly originating from Coin-It funds.
Additionally, an amount of R21.8 million was paid to Bright Future Trading Enterprises CC using Coin-It funds.
The liquidators anticipated finalizing the disposal of some assets within 12 months. Once the insolvency process was completed with the Master of the High Court, investors would receive their rightful shares from the recovered funds.
To read more, click here.
However, despite the passage of a year, investors are still anxiously awaiting the reimbursement they desperately need, trapped in an ongoing nightmare.
Sigubudu Lunga, a Bergville resident and one of the affected investors, expressed his frustration with the lengthy process.
“I invested R130,000 in Coin-It back in 2019. I have lost everything because of it,” shared Lunga, who also works as an Assistant Teacher and is a father of two young children.
Lunga revealed that he and other investors received feedback from the liquidators in February 2023, indicating that the matter would return to the high court due to suspicions of undisclosed assets held by de Beer. As Lunga and countless others await updates, they find themselves in dire situations, grappling with the financial aftermath caused by Coin-It Trading.
“I am struggling big time; my financial situation is in a mess after I put all my money into Coin It. My children are now facing challenges in school because of the financial strain that my family is under,” lamented Lunga, his despondency echoing the sentiments of many others affected by the scheme.
Tragically, reports have emerged that at least three individuals have taken their own lives due to the catastrophic consequences of the Coin-It Trading debacle.
As Lunga and fellow investors seek a glimmer of hope, Newcastillian News reached out to the FSCA for comment. However, the FSCA was unable to provide immediate input but assured that it would shed light on the situation once it had gathered the necessary information.
As this evolving story continues to unfold, we invite our readers to share their thoughts on the matter in the comment section below.
My brother and I are one of many who also invested money with Coin it. He invested about R220 000 if my memory serves me correctly, and I invested R130 000.
He is married with four children and is struggling financially because of lack of income. He is self employed, and relies of tender offers for work, and for the past few years if has been extremely dry for him. He also started getting sick due to stress caused by financial strain. And I’m a divorced mother of two also struggling financially due to the financial loss, my ex husband is not supporting his children. We would really be grateful if the court could be speed up the process so we can be reimbursed.
This man is still canvassing people to join him in buying shares with their money he hasn’t paid out in “Africa Precious Metal Resources (Pty)Ltd”. If not you are given forms to sign the sale of shares agreement or the memorandum of cession agreement. Is that permissible while the case is still on?