Investors hesitant about helping cops

THE Specialised Commercial Crimes unit is investigating a suspected pyramid scheme which has left thousands of investors broke and frustrated.

But Durban police, where the case against IM Auctioning Direct was opened, say the probe is being frustrated by lack of witnesses.

Spokesman for the Hawks in KZN Lieutenant Simphiwe Mhlongo said a case of fraud was opened at Durban Central police station last year.

However, said Mhlongo, victims of the suspected scam, believed to be in their thousands, are reluctant to come forward and make statements.

Mhlongo said, so far, no arrests have been made and appealed to those affected to come forward with information.

“No one wants to talk. They don’t want to work with us,” said Mhlongo.

He said police were more interested to know how they joined the scheme and who recruited them in order to proceed with the investigation.

The SA Reserve Bank (SARB) said its 2015 annual report showed that 41 schemes were under review, with 28 carried over from previous years. The SARB said that on December 31 last year, 19 schemes were still active.

However, SARB chief of staff Bulelwa Boqwana would not comment on the responsibility of banks to the consumer in terms of allowing pyramid schemes to use their infrastructure to receive and pay out money to the public.

“The South African Reserve Bank is a prudential regulator and supervises the prudential requirements of commercial banks. The SARB does not comment on specific matters of individuals or entities regarding investigations we may be involved in,” said Boqwana.

The SARB said in its report that “generally, illegal schemes are only reported by investors when they fail to receive their promised returns”.

The National Consumer Commission said they had not received complaints regarding IM Auctioning.