FSCA Warns South Africans of Unlicensed Crypto Firms Promising 10000% Daily Returns

The Financial Sector Conduct Authority (FSCA) has issued a stern warning to South African investors about two unlicensed companies, AfriInvest and MutualWealth, which are allegedly operating without the necessary financial licenses. These companies claim to offer AI-driven cryptocurrency trading services that promise daily returns of $542, a claim that financial experts deem unrealistic and likely false.

The fsca has made it clear that AfriInvest and MutualWealth are not authorized to provide financial services to the general public in South Africa under any financial sector laws. Efforts to contact these organizations for comment have been unsuccessful to date.

In a press release dated March 28, 2025, the FSCA confirmed that AfriInvest and MutualWealth are not authorized to offer financial services in South Africa, thereby making their operations illegal. The FSCA highlighted that these companies are soliciting funds from the public for investment purposes, promising unrealistic returns of up to R10,000 per day. Additionally, both companies have been accused of fraudulently associating themselves with prominent individuals, including media platform Maroela Media, activist Kallie Kriel, and artist Steve Hofmeyr. All three individuals have publicly denied any connection to these investment platforms.

Ask Aime: What are the risks and implications of the FSCA's warning to South African investors about the unlicensed cryptocurrency trading companies, AfriInvest and MutualWealth?

The FSCA's attempts to contact the companies have been unsuccessful, making it difficult to verify their operations and further raising suspicions. The agency warns that dealing with unlicensed companies exposes investors to significant financial risks due to the lack of regulatory oversight and consumer protection mechanisms. The FSCA advises the public to verify a company’s registration by calling 0800 110 443 or checking on its official website to protect their investments.

This warning is part of the FSCA's ongoing efforts to crack down on fraudulent and unregulated financial practices. In October 2024, the regulator took action against Banxso after the firm was reported to have promoted its platforms through a misleading campaign involving deepfake ads. In mid-April 2024, the FSCA announced an investigation into Banxso following numerous complaints about its conduct. Subsequently, in October 2024, Banxso's license was revoked, and its bank accounts were seized.

Similar fraudulent activities were reported by another investment firm called AfriMarket, which allegedly benefited from social media advertisements featuring celebrity millionaires and individuals promoting investment schemes that promised returns of more than R500,000 per month for a one-time investment of R4,800.

The FSCA urges investors to be cautious of any financial opportunity that promises extremely high returns with minimal or no risk. Unscrupulous schemes often lure naive investors with aggressive marketing techniques, including unauthorized endorsements and exaggerated earnings projections. In their press release, the FSCA advised the public to refrain from accepting financial advice, assistance, or investment offers from individuals or entities not authorized by the FSCA. Authorized financial services providers must clearly display their authorization status in their documentation. If this information is not present, the FSCA advises further investigation before making any payments.