Brothers disappear with $4.75b in cryptocurrencies

Two brothers in South Africa have disappeared along with $4.75 billion worth of bitcoin that was housed on their cryptocurrency investment platform, according to a Cape Town law firm hired by investors to investigate the alleged heist.

The law firm, Hanekom Attorneys, said it has reported the incident to the Hawks, an elite unit of South Africa’s national police force. Hanekom has also reported the matter to South African financial regulators and crypto exchanges around the world.

The New York Post reports that the brothers, Ameer and Raees Cajee, set up their crypto investment service, Africrypt, in 2019.

But in April, as the price of bitcoin surged to an all-time high, Ameer, who serves as chief operating officer of Africrypt, sent an email to investors telling them that the company had been hacked.

Ameer made an unusual request, asking clients not to report the incident to authorities or lawyers, saying that it would slow down their efforts to recover from the hacking.

But a group of sceptical investors contacted Hanekom Attorneys, “which focuses on all aspects of the cryptocurrency industry” and advises “large volume traders, exchanges and arbitrage companies.”

“We were immediately suspicious as the announcement implored investors not to take legal action,” the law firm said in a statement. “Africrypt employees lost access to the back-end platforms seven days before the alleged hack.”

The firm said that its investigation found Africrypt’s pooled funds were transferred from its South African accounts and client wallets, and pooled with other bitcoin transactions in order to make them untraceable.

South Africa’s Finance Sector Conduct Authority is also looking into the company, Hanekom Attorneys said, but the agency has said it can’t launch a formal investigation because bitcoin and other cryptos are not legally considered financial products.

When reached for comment, Ameer Cajee responded Thursday by email, directing The Post to his attorney for comment, but did not identify his attorney or provide contact information.

ITWeb reported that a South African judge ruled in favour of a group of about 20 investors, granting a provisional liquidation order against the brothers in April. They have until July 19 to argue against the liquidation, the outlet reported.

The alleged heist comes after another South African bitcoin trader, Mirror Trading International, collapsed last year. The losses included about $1.2 billion in cryptos, with some calling it the biggest cryptocurrency scam of 2020.

The two Cajee brothers were profiled in a December cover story by local outlet The Umhlanga Magazine. The story, which outlined the Cajees’ success in launching their own business, appears to have since been taken offline.

“The vision for Africrypt has always been to develop the first African cryptocurrency-focused bank, providing decentralised finance to the people who need it most, giving easy access to capital for young entrepreneurs, and stimulating growth and prosperity,” the brothers were quoted as saying in a joint interview.

“Our goal is to bridge the gap between cryptocurrency and fiat currency, making it a seamless transition between the two.”

This story originally appeared in the New York Post and has been reproduced with permission.

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