‘Trading software’ scam
TAKING ACTION: CONSUMER BODY SAYS IT HAS FINALISED ITS PROBE
Regulator wants firms to refund clients and is seeking an administrative penalty.
The National Consumer Commission ( NCC) is currently preparing its papers in an application against a group of companies selling controversial “share analysis software”. The regulator will be asking the National Consumer Tribunal to rule that the companies have contravened multiple sections of the Consumer Protection Act.
Between 2015 and 2017 Moneyweb reported extensively on its investigations into these companies, which sell the Optimal Market Systems software. They are all staffed and managed by the same people and owned by either Lucas or Lorien van der Merwe. They use aggressive methods to sell their product, which they claim will guarantee success in trading on the stock market, with returns of 40% in six months.
The companies include Cursu Taurorum, Tenacity Capital, VDM Capital, Pro Equity Management, CT Capital Management, Aeromax Trading, Voltic Direct, Quantico College and Quantico Trading. The Van der Merwe husband-and-wife team have serially registered new companies over many years, but all of them do the same thing, and most of them share a registered address in Hatfield, Pretoria.
Moneyweb’s investigations identified dozens of unhappy consumers who were promised high returns and money-back guarantees by company salespeople.
However, the software they are sold is only an analysis tool and does not allow them to trade on the JSE. Those who attempt to return it for the promised refund are inevitably turned away.
Other questionable sales practices include salespeople requiring new customers to sign multiple credit card slips, which may be connected to unauthorised debits that a number of clients later report seeing from their accounts, and misrepresenting the costs involved. Some customers are also told that they can pay off the cost of the software over a number of months, but their credit cards are then immediately debited for the full amount.
In the years since publishing the articles, Moneyweb has continued to receive complaints about the companies along similar lines. There are also numerous complaints on Hello Peter.
A number of clients who withheld payment when their requests for refunds were refused have been threatened with legal action. Clients are also promised daily trading tips and market updates, which many say they never receive.
On the Quantico College website there is a tab for “daily reports” which claims to show the “latest market news”, but the information shown is more than six months old.
After years of investigation, the NCC has now confirmed that it is set to seek action against the companies. In a written response to Moneyweb, acting commissioner Thezi Mabuza indicated that the regulator will be asking the Tribunal to rule that the companies contravened sections of the Consumer Protection Act that give consumers the right to return products during a cooling off period and receive a refund, and that certain provisions in their sales contracts deprived consumers of their rights under the act.
The NCC will also ask the Tribunal to interdict the companies from engaging in this conduct, and to order them to refund customers. In addition, it is seeking the imposition of an administrative penalty of R1 million, or 10% of turnover.
Any consumers who have a complaint against these companies should lodge it with the NCC. Attempts to get comment from the implicated companies were unsuccessful.