Cryptocurrency investors in South Africa may have lost nearly $ 3.6 billion worth of Bitcoin following the disappearance of two brothers associated with one of the country’s largest cryptocurrency exchanges.
According to information published by international agencies, a Cape Town law firm has announced that it cannot locate Ameer and Raees Cajee, the founders of the Africrypt company.
Investors’ lawyers at a cryptocurrency exchange in South Africa, who told clients in April that their accounts had been hacked, say $ 3.6 billion has disappeared from the platform and the two brothers who ran it cannot be traced.
If confirmed, Africrypt’s losses would rank among the biggest crypto losses yet. For all of 2020, losses in the cryptocurrency sector through fraud and other crimes were $ 1.9 billion, down from a record $ 4.5 billion in 2019, according to crypto intelligence company CipherTrace.
Africrypt COO Ameer Cajee said in a letter to clients dated April 13 that all client accounts had been compromised due to a recent breach in their system. The letter, reviewed by Reuters, said Africrypt had halted operations and had “begun the process of trying to recover the stolen funds.”
He did not give details of how much money was missing and warned clients that trying to get their money back with lawyers “would only delay the recovery process.”
Darren Hanekom, a lawyer representing investors, said that Cajee and his brother and co-founder Raess had not been traced since the April 13 letter and that he had referred the matter to South Africa’s anti-corruption police, nicknamed the Hawks, last April 16.
Philani Nkwalase, a spokesman for the Hawks, said they had so far not been able to open the case because Hanekom Attorneys is based in the Western Cape and those seeking to get their money are located in other provinces.
To complicate any recovery attempt, the South African Financial Sector Conduct Authority is unable to initiate a formal investigation into the incident because the cryptocurrency is not legally considered a financial product in the country.