Founders of South African Bitcoin exchange disappear after $3.6 billion 'hack'

[boyptc]

But it's great for those to learn from this things or ponzi scheme so that they won't do that again in future.

Sadly.

They will continue and will just change the name of it with a quite different style. And those people that have thought that they can make money from the new scheme, they'll continue to invest.

Including those that never learn from their experiences of being scammed by these ponzis.

[macson]

snip

Here is an archived page:
https://archive.vn/8AoqX

Sounds more like the usual ponzi scheme, probably those 3.6 billions (calculated at max peak price) are more likely sums people though they have in their accounts than actual money invested.

Anyhow, sorry to say it, but the ones investing millions with a company run by a 20 and a 17 year old were looking for a way to lose money.

looks like these exchange investors didn't do their research first....entrusting someone under the age of 20 to manage money is stupid.  both of them are not yet "mature in thinking" so when they find a problem they will immediately panic.  they definitely won't be able to hide far away but those who are deceived have already lost time and money.

[Gyfts]

It sounds like an insider job. The excuse given by the promoters, that informing the authorities would slow down the recovery of the stolen funds sounds just ridiculous. This was just a delaying tactic, so that these criminals could move the funds to some off shore tax haven. Anyway, now the users can blame themselves. One of the golden rules of investing in cryptocurrency is "not your keys, not your coins". These people did the mistake by keeping their coins in an exchange wallet. Now all they can do is to regret.

Of course it was an inside job. South Africa is a lawless country with rampant crime and government corruption. The scams run nonstop. Their police force and legal system is so utterly worthless, these people could admit they ran with the money and pay some small fine, and keep the rest.

Never, ever, trust an exchange, reason XXXXX.

[Sithara007]

Of course it was an inside job. South Africa is a lawless country with rampant crime and government corruption. The scams run nonstop. Their police force and legal system is so utterly worthless, these people could admit they ran with the money and pay some small fine, and keep the rest.

Never, ever, trust an exchange, reason XXXXX.

I don't think that the South African law enforcement agencies have the resources to take action, even if they want to. As already posted here, the hack was kept secret for many weeks, which allowed the promoters to vanish. We can't really blame the authorities, since it was not reported to them immediately. The investors chose to trust the Cajee brothers and hid the news of the robbery from everyone. Once the coins are mixed and then cashed out, it is almost impossible to trace them. And in this case, that phase seems to have passed unfortunately.

[oHnK]

I consider this case quite dubious if there really was a hack on their exchange. Why don't they report it to the authorities? If they were honest, they wouldn't have to run and disappear. A leader of a big business that has a market of 3.6 B should be wise if they are honest people. Do not report to the authorities quickly, run and disappear. If it really happened, big investors would track it down no matter what. It's purely them who are taking the money away like the previous turkish crypto boss.

[wiss19]

So this makes it the largest loss of bitcoin under such circumstances when you consider the contemporary value of the coins lost.  The exchange, Africrypt, told investors they were the victim of a hack and not to alert the authorities, you know, cuz that's super legitimate.  Some law firm attempting to investigate have tracked the stolen coins to tumblers and mixers to try and obscure where the stolen bitcoin was going.  I guess it remains to be determined if they were actually hacked or stole the money themselves, but the two founding brothers can't be found.

Lol, their first excuse that users/investors shouldn’t alert authorities about the missing money already shows that they are the ones behind it. They are just trying to make it seem like they are not the ones, but it’s clear enough that they are the ones. From the story I have read here it is very clear that they are the ones that pulled off this trick. And moreover why did they run away? If they were not guilty, why are they running.

And I also wonder why their employees lost access to their back-end platform seven days before the hack occurred. That goes to show that it is an inside job, they are the ones that did that. Since crypto is not legally considered a financial product in South Africa, I wonder how the investors will go about this.

[ene1980]

Of course it was an inside job. South Africa is a lawless country with rampant crime and government corruption. The scams run nonstop. Their police force and legal system is so utterly worthless, these people could admit they ran with the money and pay some small fine, and keep the rest.

How long they will be running away from the law, the exchange will be having money from citizens of other countries and if they are caught i am sure they will be prosecuted for fraud if they really ran away with the money.

Do you seriously think that they will get away with a small fine for $3.6 billion and will be allowed to keep the rest, i really do not think so  .

[Sithara007]

I heard that the two promoters (Raees Cajee and Ameer Cajee) have surfaced in England. Is this news confirmed? If that is the case, then it may take many years (if not decades) to get them back to South Africa. The Extradition laws in England are mired in bureaucracy and red tape. Even if the court orders extradition, the criminals can file multiple appeals and they can further delay the proceedings by filing an asylum request (this was done by the Indian criminal Vijay Mallya, who fled to England in 2016). England has a very relaxed attitude for financial criminals from the other countries (in fact London is regarded as the ultimate refuge for financial criminals), and it will be very difficult for the South Africans to get the money back now.

[jaysabi]

So this makes it the largest loss of bitcoin under such circumstances when you consider the contemporary value of the coins lost.  The exchange, Africrypt, told investors they were the victim of a hack and not to alert the authorities, you know, cuz that's super legitimate.  Some law firm attempting to investigate have tracked the stolen coins to tumblers and mixers to try and obscure where the stolen bitcoin was going.  I guess it remains to be determined if they were actually hacked or stole the money themselves, but the two founding brothers can't be found.

So another fishy situation where billions worth of Bitcoin is lost and the owners are missing and they are claiming it was a hack. How do they think they can get away with billions of dollars and it looks really fishy and we were not hearing about any major hacks for sometime and now this is a major theft/ hack situation and i really feel bad for the traders who held their coins in their exchange wallet.

I suppose it's possible that being a couple of young kids, they designed the exchange so poorly from a security standpoint that someone was able to gain access and steal the coins.  The disappearance then would be going into hiding I suppose because there are $3.6 billion worth of people pissed off at you.  But as others have pointed out, with the touting of unrealistically high returns, this does look more like a ponzi scheme.

[Vishnu.Reang]

Because it was probably an inside job as a lot of the users in this forum is speculating. Also, this smells like a big conspiracy because I have read in the other thread about this "exit scam" that a bank was speculated to be also part of this scam.

LOL.. you still have doubt about it? It has been confirmed that the two promoters (Ameer and Raees Cajee) have now landed in the United Kingdom. They made careful planning about the whole episode. They fooled the investors in to believing that the coins could be recovered if they don't inform the police immediately. Using this opportunity, the two promoters fled South Africa and landed in a country which is regarded as a paradise for financial scammers. The investors need to be blamed here. If they had informed the police, then these two would have been in prison now.

[Koro-Sensei]

This is probably the main reason why you should not trust centralised exchange and switch to decentralised one. Another victims of fraudsters who's probably be using others hard earned money for their own interests. I wish the people of South africa that they could still recover the hacked amount and punish those who did nothing but worsen the situation of poor.

[barbara44]

Centralized exchange and the problem of theft and scam is nothing new. I have always advocated for centralized exchanges over decentralized ones because they are easy to use and cheaper to trade but I guess now it is time that people actually consider using decentralized exchanges. These scams are inevitable because some might genuinely get hacked and some might feel they have too much in their wallet to operate legally now.

After reading some comments I realize that it was more a ponzi than an exchange.

There is a saying in my nation that goes "scammers who scam only other scammers are not scammers" or something like that

Everyone is a scammer in the sense that we at some point have made mistakes. I cannot find a person in my life who has never made a mistake and does that entitle everyone to scam everyone else? I don't think so. It's quite off-topic to say but anyone who scams someone else is a scammer regardless of who and why they scam.

[Xinarae*]

I think the founder of the south african bitcoin exchange disappeared after the $ 3.6 billion hack but it's not fair for people to believe. Decentralization will not affect anything decentralized people will be able to use whatever they want if something is hacked, it is possible to recover it bitcoin is a cryptocurrency digital asset that acts as a design exchange medium that uses to control the creation and management of cryptography rather than relying on central authorities there is no legal action here.

[Sithara007]

I didn't know about them landing in the UK, wouldn't they be extradited though because I think that UK doesn't have any laws that prevents extradition on a criminal. That convincing that they shouldn't report to the police was a big risk for them that paid off sadly. Hopefully they will answer to their crimes.

Here is the latest news:

https://www.bbc.com/news/technology-57582805

The two brothers have claims that they have received death threats from investors in South Africa. This is classic style of how financial criminals work. If they can claim that their lives are under threat in South Africa, then the British courts will never deport them back to SA. And the British system takes the case favorably, unless some of the British nationals have lost money. Since it is the South Africans who have been scammed, the British government is going to tolerate their presence in UK. In the past, dozens of financial criminals have migrated to the UK from countries such as India, Greece and Russia, to take advantage of the "open doors" policy meted out by the British government.

[zanezane]

~

Here is the latest news:

https://www.bbc.com/news/technology-57582805

The two brothers have claims that they have received death threats from investors in South Africa. This is classic style of how financial criminals work. If they can claim that their lives are under threat in South Africa, then the British courts will never deport them back to SA. And the British system takes the case favorably, unless some of the British nationals have lost money. Since it is the South Africans who have been scammed, the British government is going to tolerate their presence in UK. In the past, dozens of financial criminals have migrated to the UK from countries such as India, Greece and Russia, to take advantage of the "open doors" policy meted out by the British government.

That's kind of a racist or exclusionist of a law if I say so myself, I think that they still should arrest them though because these are financial criminals and that the threats should be investigated because they might be fabricated so the government can't extradite them. This is probably another one of their con, they might go to another place again if UK doesn't do anything about these two criminals.

[TastyChillySauce00]

It's really time for p2p and decentralized exchange to shine seriously, until how many times people gonna get scammed again and again meanwhile if there's a trustless platform for p2p where people could trade to each other without any struggle to trust each other while also making things convenient, it should become a preferred method. These centralized exchange scamming and their owner that could get away with billions of dollar honestly is really tiring to hear.
sad thing though people still gonna prefer to use cex despite all these cases.

[Vishnu.Reang]

It's really time for p2p and decentralized exchange to shine seriously, until how many times people gonna get scammed again and again meanwhile if there's a trustless platform for p2p where people could trade to each other without any struggle to trust each other while also making things convenient, it should become a preferred method. These centralized exchange scamming and their owner that could get away with billions of dollar honestly is really tiring to hear. sad thing though people still gonna prefer to use cex despite all these cases.

If the trade volumes and liquidity in Dex sites are as good as the Cex platforms such as Binance and Huobi, then the users will obviously prefer the Dex sites. But from my experience, I would say that it is not very profitable to deal in these dex platforms. While I was dealing in bounty tokens, the exchange rates for the same token in Dex platforms were lower by 50% or more, when compared to the rates in Cex exchanges. On top of that, for the low volume tokens, it is very difficult to liquidate large volumes at once using Dex.

[Silberman]

               The fact that the founders themselves were telling the customers to not inform the authorities about the "hack" that has happened already placed a target sign on them. They had all the time in the world to prepare for such a feat but became impatient and did the scam half-assed. Lol. Now they have to live the rest of their lives in hudung because of this mistake. Even if they had planned things thoroughly, releasing such a statement was just ridiculously dumb. Literally no one would ever say such things if the "hack" that they were using as an excuse were really true. I hope they get caught and rot in jail for scamming people who did a lot of effort to gain capitals for investing in thus industry.

I suppose there is little doubt then that this was in fact an inside job as many of us thought from the very beginning, but even if that is the case catching people like that is not as easy, there are countries which do not recognize cryptocurrencies as assets so it is fair to wonder if in those countries what they did can be considered crimes or not, also those people could just move to a country which has no international agreements of extradition and roam the streets as free people without the danger of being arrested.

[sana54210]

Here is the latest news:

https://www.bbc.com/news/technology-57582805

The two brothers have claims that they have received death threats from investors in South Africa. This is classic style of how financial criminals work. If they can claim that their lives are under threat in South Africa, then the British courts will never deport them back to SA. And the British system takes the case favorably, unless some of the British nationals have lost money. Since it is the South Africans who have been scammed, the British government is going to tolerate their presence in UK. In the past, dozens of financial criminals have migrated to the UK from countries such as India, Greece and Russia, to take advantage of the "open doors" policy meted out by the British government.

That's kind of a racist or exclusionist of a law if I say so myself, I think that they still should arrest them though because these are financial criminals and that the threats should be investigated because they might be fabricated so the government can't extradite them. This is probably another one of their con, they might go to another place again if UK doesn't do anything about these two criminals.

I believe that is not racist at all. Why? Because British government only cares about money, and money of others, so if you steal money from Greek people and bring it to UK? That is a good thing for UK, if you steal from South Africans and bring it to UK? That is a good thing for UK, if you steal from British and take it somewhere else? That is bad for UK.

So long story short UK do not care if you are a bad person or a good person, they only care about you being fair or not and as long as you are fair that means you are going to be fine. I do not really care if you are African or British, if someone stole 3+ billion dollars worth of money and then came to my nation? I would be thrilled and not look to jail them or send them back, I would make them put that money in one of my nations bank and tell them to live happily ever after, they technically do not own the money itself since it will be in the bank, and they would just slowly spend it and die. That is how nations grow big, you need a lot of people who are super rich.

[bryant.coleman]

I believe that is not racist at all. Why? Because British government only cares about money, and money of others, so if you steal money from Greek people and bring it to UK? That is a good thing for UK, if you steal from South Africans and bring it to UK? That is a good thing for UK, if you steal from British and take it somewhere else? That is bad for UK.

So long story short UK do not care if you are a bad person or a good person, they only care about you being fair or not and as long as you are fair that means you are going to be fine. I do not really care if you are African or British, if someone stole 3+ billion dollars worth of money and then came to my nation? I would be thrilled and not look to jail them or send them back, I would make them put that money in one of my nations bank and tell them to live happily ever after, they technically do not own the money itself since it will be in the bank, and they would just slowly spend it and die. That is how nations grow big, you need a lot of people who are super rich.

I completely agree with this post. If the UK doesn't allow them entry, then some other country will offer them residence. There are dozens of small island nations, where these two will be more than welcome. All that matters now is money. If you have money with you, then nothing else really matter. And that is the reason why Mohammed bin Salman of Saudi Arabia is held in high regard by everyone, while Kim Jong Un is derided as a dictator. In reality, both of them are equally evil. But the difference is that Mohammed bin Salman has hundreds of billions of USD worth of funds at his disposal, while Kim Jong Un doesn't have any such luxury.