Cryptocurrency News

South African Police Probe $80 Million Bitcoin-Based Ponzi Scheme

The South African Police Department have placed their elite “Hawks” division in charge of investigating the Bitcaw Trading Company for suspected investment fraud following a reported R1billion ($80 million) BTC Global investment pyramid scam that has affected more than 28,000 investors. 

In March of this year, South African citizens were buying into the hype surrounding a new, homegrown Bitcoin investment company named BTC Global. Thousands of South Africans were sold on its logic and saw it as a quick and easy investment with guaranteed returns.

However, it now seems that far from being a great investment opportunity, BTC Global is nothing more than a pyramid scam, a classic Ponzi scheme, where new investor’s seed money is used to pay prior investors as proof that their investment is making money. An estimated 28,000 South African investors have been scammed out  of a combined $80 million, and as result, the Hawks have been brought in to investigate.

Who Are BTC Global?

BTC Global are also known as BitCaw Trading, based on the name of the company’s founder, Andrew Caw. There is very little info on the site about Caw or his company. A Facebook page reveals what appears to be an ordinary young family man, hardly South Africa’s very own Bernie Madoff, who Andrew Caw may yet turn out to be.

In an introduction to his investment ethos on the Bitcaw homepage, Caw says:

“My goal is to help people make money with Bitcoin.

I’m not selling mining – mining locks in your capital & pays out a decent return compared to traditional investments but returns are volatile. Ultimately Mining is good but Holding is better.

I’m not selling Trading – Most newcomers to trading lose money. Not everyone, but most. Trading is also very time consuming to learn and do daily.

I promote Holding – Simply buying Bitcoin & keeping it in a safe wallet has outperformed Mining or any other traditional investment I’ve ever seen. In fact over the last 3 years holding Bitcoin would have given you a 6000%+ growth on your initial capital.”

Who Are The Hawks?

Established in 2008, the Hawks are South Africa’s DPCI (Directorate for Priority Crime Investigation), and their remit is to target high-level organized crime, white-collar and economic crime, plus political, financial and industrial corruption. The Hawks are only called in to investigate major cases, so clearly the South African police are taking the BTC Global case extremely seriously.

It has therefore made both national and international headlines today (May 28) to see that the Hawks have been called in to investigate an $80 million investment fraud supposedly carried out by the Bitcaw Trading Company. Bitcaw reportedly sold BTC Global to investors with the promise that they could make a 50% monthly return on their investment, paid out as 14% per week. To become an investor with BTC Global, Bitcaw required a minimum investment of R12,000. In what is classic Ponzi fashion, investors became concerned when, after initially receiving the payments they were promised, those payments soon dried up, and no further monies were forthcoming.

The South African police have asked those who feel they are victims of BTC Global to come forward and contact them in the strictest confidence. All contact information is on the South African police website.

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