Carmol prepares for court action after allegations of Ponzi scheme

CARMOL Distributors, the company running an alleged R450million Ponzi scheme, has instructed its legal team to pursue “an action for damages” against embattled Innovatech director Prinasen Dhaver.

This follows a Business Times investigation in which Dhaver provided evidence that Innovatech had secured returns for its investors of up to 8% a month through investments it made in Carmol.

Innovatech’s “profit-share” agreements with investors caught the eye of the Reserve Bank, which expressed concern about the business operating in contravention of the Banks Act. Dhaver was arrested last month by the commercial-crimes division of the Hawks and released on R100 000 bail.

As Innovatech’s profit-share agreements were based on the agreements made with investors of the apparently much larger Carmol, “if [Inno- vatech] is contravening the Banks Act, [Carmol] is contravening the act,” Dhaver alleged.

Carmol CEO Yunus Moolla said in a letter to its investors: “Mr Dhaver has made various media statements which were intended to hurt Carmol.

“Carmol has instructed

its legal team to pursue an action for damages against Prinasen Dhaver and/or Innovatech to maintain its integrity and good name”.

However, Moolla’s letter makes no attempt to respond to a much deeper Business Times investigation, which revealed that Carmol was operating an apparent Ponzi scheme.

Business Times revealed that the spectacular 96% annual returns offered by Carmol to the public contravened the Consumer Protection Act and defined it as a money-multiplication scheme.

This is the South African legal definition for schemes commonly known as Ponzi schemes.

Business Times also revealed that Carmol, which allegedly has more than 2 000 investors, appeared to be contravening the Banks Act by taking deposits without a banking licence.

In response to questions, Moolla’s assistant, Duran Govender, at first indicated that Moolla was on religious holiday and then, a week later, that he was “extremely busy” attending to a family emergency and was thus unable to answer.

On Friday, Moolla replied to questions on his letter, saying: “You have printed what you wanted to print, I am out of my office, call me on Monday.”