Just a week after a mysterious ‘white knight’ offered creditors $ 4 million (R64 million) to bail out investors in the failed Africrypt scheme, another mysterious investor appeared with a best offer of $ 5 million (R80 million). , equivalent to 65 cents in the rand.
The first offer made in November was also for $ 5 million, although only $ 4 million of that would go to creditors, and the remaining $ 1 million (R16.13 million) would go to the operation of the company.
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This latest $ 5 million offer is a simpler offer, with a seven-day deadline for acceptance, after which the ‘white knight’ will buy and take over the claims.
Africrypt crashed in April after its accounts were allegedly hacked and emptied of all funds. But it turns out this wasn’t the first stunt to hit Africrypt’s founders, brothers Raees and Ameer Cajee, and their investors.
As Moneyweb reported, a previous investment plan of theirs was allegedly hacked in May 2019, causing more than a few Africrypt investors to suspect foul play. Two hacks in less than three years seemed far-fetched to some investors, who suspect the Cajees are now using powers to make an offer in compromise in hopes of avoiding jail.
Read: Lightning strikes twice for the Cajee brothers of Africrypt
The latest 65-cent offer in the rand is based on the amount deposited by investors, not the current value of the ‘hacked’ bitcoin or Ethereum.
Investors who deposited in Africrypt in September 2019 would have paid around R120,000 for their bitcoin, which is worth around R800,000 today.
This offer effectively means that investors will receive less than R80,000 per bitcoin, for an asset that is worth 10 times more than today.
Africrypt was run by the Johannesburg-based Cajee brothers, who solicited funds from investors promising returns of up to 10% a day using a computerized trading algorithm.
These promises were even more outrageous than MTI’s claims of daily returns of 0.5-1.5%.
MTI was placed in provisional liquidation a year after failing to pay members’ withdrawal requests. MTI also claimed to have a computerized trading algorithm, although the Financial Sector Conduct Authority (FSCA) found no evidence of this when it investigated it.
Similarly, there is no evidence that the Cajees were exchanging the cryptocurrencies entrusted to their care.
The Cajees were missing at the time of the alleged attack and are believed to be in the Middle East.
The first offer to buy the Africrypt investor claims made in November had a catch: Anyone who accepted the offer would have to drop criminal charges against the Cajee brothers and their affiliated entities.
It is likely that this condition was illegal, and is referred to in the law as “aggravation”, which consists of agreeing not to prosecute a crime in exchange for a reward.
The second rescue offer presented to investors last Friday (December 3) does not carry the obligation to drop the criminal charges.
The first offer specified that the Cajees would be hired by Africrypt, which would resurrect as a commercial entity so that investors could recoup their full investment.
Investors hoped this would provide an opportunity to question the Cajees about the circumstances surrounding the alleged hack, and whether it was a genuine hack or an inside job. The Cajees have maintained that the attack was genuine and denied any involvement in what some believe was a robbery, according to the newspaper. BBC.
The identities of the first and second ‘savior’ investors remain unknown, although Ruann Kruger, legal representative of the Africrypt liquidators, says the second investor is a company.
“I cannot reveal the identity of the company at this stage due to a confidentiality agreement,” he tells Moneyweb.
“We have no idea the identity of the first investor,” he adds.
Kruger says that so far 35 of the 181 investors have indicated their intention to accept the offer.
Says a representative of some investors: “Of course, there are suspicions that this offer comes through a proxy for the Cajees, and that they are paying us with [our] own money. Either way, this is a smart tactic from whoever the investor is. It’s a division [and] rule tactic.
“What I see happening here is that the smaller investors will accept the offer, then the larger investors will be treated bit by bit. It is a smart strategy, but high risk, because I think some of the investors will not accept this offer and will wait for a better offer. ”
Attorney Gerhard Botha, who represents some of the investors, says that any offer of 65 cents in the rand in any liquidation situation is not a bad deal.
“You must remember that until now there has been no offer on the table. There is also no evidence that there was a hack, and there is no evidence that the money was actually invested. [by the Cajees]. There is a strong possibility that this will be a big deal for the Cajees, both legally and financially, but at the end of the day, investors will make a decision based on purely commercial considerations, “he adds.
In a letter to Africrypt investors sent Friday, the joint interim liquidators say they had received no further communications or comments from the first “third investor” on the amended terms of the compromise offer, which sought to indemnify the Cajees against criminals. prosecution.
This raises suspicions among investors that the Cajees were behind the offer, which they decided to abandon when it was pointed out that they could not buy their way out of a potential jail.
The letter from the provisional liquidators says that the second offer in compromise is “a good, firm and less complicated offer that is open for acceptance during the next seven days.”
Those who accept the offer will receive 65 cents in the rand for any proven claim within five days of signing.
Africrypt investors are estimated to have deposited around R120 million, although the value of their stolen cryptocurrencies today is worth many times this amount.