Investment company heads arrested for graft
TEN months after Weekend Argus sister title the Saturday Star revealed the investigation into rare metal investment company Global Electio Investments, four of its top leadership have been arrested, including two former directors.
The company, suspected of defrauding hundreds of unsuspecting South African clients of an estimated R500 million, promised growth interest rates of up to 23%.
In January, the Hawks revealed it had entered into a joint probe with private firm IRS Forensic Investigations, after 30 of the company’s clients came forward claiming the company had defrauded them of tens of millions of rand.
For years, the company used boiler roomstyle tactics, calling up potential investors across South Africa to aggressively sell “baskets” of Earth metals that would be stored in Dubai as their value increased.
The most basic package, the defence basket, which held materials used in military vehicles and cars, sold for R43 000.
The green energy basket, holding metals used in solar panels and other Earth-friendly products, went for about R50 000. The future tech basket, which supposedly held metals used in PlayStations and home appliances, went for almost R100 000 and the smartphone basket for R500 000.
On Tuesday, former company director and Iranian national Jalil Motazedi was arrested, alongside three South Africans: director Ian McGregor, Kyle Pillay and Shaunita Singh.
While the four have been charged with 24 counts of fraud based on 24 former clients, it’s understood police investigators and the State prosecutor are still canvassing other investors to increase the number of charges.
On Wednesday, the group appeared at the Specialised Commercial Crimes Court in Johannesburg, where McGregor, Pillay and Singh applied for bail. Represented by Johan Eksteen of BDK Attorneys, all three claimed innocence, saying they wished to clear their names in court.
As the trio did not have previous convictions and were prepared to hand over their passports to ensure they did not evade trial, they were each granted bail. However, Motazedi was unable to continue with his bail application due to his status as a foreign national, and he is due to appear in court on Wednesday.
IRS director Chad Thomas said the arrests were a joint effort with the Pretoria K9 Unit and members of the Joburg Hawks Commercial Crimes Unit.
“IRS has been investigating this case since late 2016 and now represents in excess of 40 victims of the sophisticated fraud. Multiple cases have been opened and several suspects identified in multiple jurisdictions,” he said.