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African United Stokvel red-flagged by FSCA
Amid suspicions that it is participating in unauthorised activities as well as misleading clients.
The authority says a successful search and seizure operation was conducted at the Stokvel’s offices in June. Image: Moneyweb
The Financial Sector Conduct Authority (FSCA) is warning consumers to be cautious about doing any financial services-related business with African United Stokvel on suspicion the entity is participating in unauthorised business and breaching some financial sector laws.
Search and seizure
In a statement issued on Monday, the authority confirmed it conducted search and seizure operations at the Bryanston-based entity’s offices in June as part of ongoing investigations into its affairs.
The FSCA says it was prompted to investigate the stokvel’s business activity after receiving a whistleblower report.
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African United has allegedly misled consumers, purporting to be running a digital stokvel and promising to invest client funds into property and telecommunications. It also claims to have applied for a financial services provider licence, a claim the FCSA has refuted.
“The social media pages of United African indicate that it is a digital stokvel that invests clients’ funds in property and telecommunications. It claims that the returns from these investments are used to pay client returns,” the FCSA said.
“There are various complaints from clients stating that although they were promised returns, they have not received them,” it added.
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“The FSCA wishes to advise that to provide investment products and other financial services requires authorisation by the FSCA.”
The process of examining evidence will ensue, with the authority confirming that it will be interviewing the parties involved. Once concluded, the FSCA said it might take further steps with law enforcement and prosecuting authorities.
Moneyweb has made attempts to reach African United Stokvel for comment but was unable to reach it through the contact number listed. We also struggled to find alternative contact details as the entity’s website link was flouted as being unsafe.
Clients of the stokvel have been urged to contact the FSCA’s business sector via this form on its website.
This article originally appeared on Moneyweb and was republished with permission.
Read the original article here.
