FSCA warns consumers about dodgy investments on Telegram

The FSCA is warning consumers to be careful when they do any transactions with SwiftKryprtoTrade, Glowfx, Bennefx and Xprestrade and David Carter.

The Financial Sector Conduct Authority (FSCA) says it has come to the authority’s attention that SwiftKryprtoTrade and individuals allegedly linked to it, are using the social media platform Telegram to target consumers by falsely claiming to be agents or representatives of the Johannesburg Stock Exchange (JSE).

The JSE is a licensed exchange in terms of the provisions of the Financial Markets Act and is also a self-regulatory organisation. The FSCA says impersonators use images of senior executives of the JSE and its employees to lure members of the public to solicit investments from people who want to trade and earn high profits.

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JSE confirms it is not involved

The JSE confirmed it is not associated with the impersonators and that they are using its brand name, logos, trademark and pictures of its employees without its permission, to offer investment opportunities to members of the public. It also does not conduct business using Telegram.

The individuals in question were not available for comment.

The FSCA believes that these individuals are conducting unauthorised financial services business and are providing advisory and intermediary services without the necessary authorisation. Financial services business refers to people who advise consumers on investing their funds and is often in the form of offering the public investment opportunities.

It also refers to people dealing with investments and includes receiving funds from consumers, making investments on their behalf and trading in any financial product for or on behalf of them or enabling them to trade in financial products.

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Consumers must be careful when they invest

The FSCA urges consumers to act with care when investing their funds. “There are many fraudsters operating scams and the number is growing. South Africans lose millions of rands every year to fraudsters. Illegal operations are sometimes well-disguised as legitimate operations.”

Red flags for scams include:

• Unrealistic returns;
• Claims that the entity or person does not require an FSCA license;
• Vague information about the investment product or the company that provides the financial product;
• Claims that the investor must act urgently, and
• Requirements to pay more money to have your investment returned.

“To avoid unnecessary risk, consumers must not accept any financial advice, assistance or investment offers from people who are not authorised by the FSCA to conduct financial services. Authorised financial services providers must display the fact that they are authorised on their documentation and explain what specific financial services they are licensed for. If this is absent, consumers should avoid paying any funds without investigating it further,” the FSCA says.

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Glowfx, Bennefx and Xprestrade and David Carter

The FSCA also warns consumers to be cautious when conducting financial services related business with Glowfx, Bennefx, Xprestrade and one David Carter.

“It has come to the attention of the FSCA that Xprestrade provided a client with a document purporting to be an FSCA “Guarantorship” agreement. The document purports to guarantee the conversion of Bitcoin to cash.

“The FSCA’s records show that Glowfx, Bennefx and Xprestrade are not authorised by us, terms of any financial sector law to render financial services or provide financial products in South Africa.”

The FSCA points out that the claims made by these people are false, as it does not issue “Guarantorship” agreements. The document also claims that “Mr. David Carter” is the FSCA’s legal authority, but nobody called “David Carter” is employed by the FSCA.

“It is the FSCA’s view that these individuals are conducting unauthorised financial services business. To avoid unnecessary risk, the public should not accept any financial advice, assistance or investment offers from persons who are not authorised by the FSCA to conduct financial services.”

Consumers who want to conduct financial services with an institution or person can check if they have the necessary authorisation by either calling the FSCA’s toll-free number (0800 110 443) or on https://www.fsca.co.za/Fais/Search_FSP.htm whether an institution or person is authorised to render financial services.