Angel investor pays off victims of alleged Bitcoin Ponzi Africrypt
A private investigator (PI) chasing brothers behind alleged billion-dollar Bitcoin exit scam Africrypt hopes they’ll still serve jail time — despite some investors signing away litigation rights.
Dubai-based Pennython Project Management reportedly stipulated an end to potential prosecution in a remittance agreement with around 200 Africrypt investors.
As many as 95% of users who lost funds have accepted the terms with the little-known firm, which has reportedly processed around $12.5 million in claims from Africrypt investors so far.
But private investigator Sean Peirce, who represents around 35 investors, said he’s still keen for Raees and Ameer Cajee to face prosecution.
“We are pushing for the brothers to be charged for fraud, theft, possibly money laundering,” said Peirce (via Bloomberg).
“They stated that they were hacked and we have proof that they were not … their intent was to defraud and to steal.”
As Protos previously reported, the fresh-faced Cajee brothers fled South Africa last April after claiming their crypto investment firm had been hacked for all its crypto.
Just 18 and 21 at the time, Raees and Ameer reportedly left contributors out of pocket by as much as 69,000 BTC ($3.2 billion), worth $3.6 billion at the time.
However, a lawyer for both brothers valued the missing money much lower, at $5 million. Still, the Cajees face between 10 and 15 years in prison if convicted, according to Pierce.
Africrypt founders still at large
Peirce, who runs Durban-based Coast to Coast Special Investigations, says some Africrypt contributors have received refunds from a surprise benefactor. Others haven’t.
“Investors that I represent got paid out some money. However, we are still pushing forward with the criminal case as there is still money lost,” he said.
Some have questioned who is behind Pennython and the payouts to Africrypt investors.
The mysterious firm with unknown directors stepped forward in November, just before the Cajee brothers were due to testify in front of liquidators in a virtual hearing.
The hearing was indefinitely suspended after Pennython offered to pay back investors. The firm agreed to swallow the debt to acquire in Africrypt’s proprietary technology.
Nevertheless, Africrypt’s owners remain at large, claiming to be dodging undesirables who paid into their fund.
Initially founded in 2019, Africrypt represented itself as one of Africa’s most successful crypto ventures. The brothers purportedly used AI to leverage client funds in crypto offering healthy return on investment.
Last June, shortly after fleeing, Raees told the Wall Street Journal (WSJ) that the pair managed money for some “very dangerous people.”
From an unknown location, Cajee also disputed the size of Africrypt’s assets under management. They claimed to WSJ that Africrypt controlled just $200 million — far below the $3-billion-plus figure cited in media reports.
Last month, the pair’s attorney told reporters the nature of Africrypt purported hack would make it hard to prove to prosecutors.
Signs point to a classic Ponzi
The Cajees were thought to have leveraged investor cash to fund a lavish lifestyle, including renting a swish home in the upmarket Zimbali resort. Prices for properties in the wealthy community regularly exceed $1 million.
Reports last year also suggested the brothers enjoyed fast cars, exotic vacations, and designer clothes.
It’s worth noting that some in the crypto community have also questioned the true value of Africrypt’s missing funds.
Cryptography expert Jameson Lopp couldn’t find the missing 69,000 BTC ($3.2 billion) in his investigations.
In any case, it’s unclear whether the brothers will face any future litigation — thanks to Africrypt’s angel investors at Pennython.
Pennython’s agreement to buy out the debt could halt liquidation proceedings with a decision expected after January 31.
Read more: [Crypto Ponzis flood Spanish courts as thousands sue for millions]
Indeed, some investors were happy to recoup part of their initial investment; not hellbent on the potentially long litigation.
“It was a case of whether we hang in for another year or two and fight the fight, or take what we can,” said an Africrypt investor (via ITWeb).
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