The police in South Africa are looking into a possible crypto scam case after an investment company attempted to reimburse some investors from the now-defunct Africrypt exchange.

Police Launch Closer Look at Africrypt

Bloomberg informed that South African Police forces across four provinces, including Durban and Johannesburg, are currently investigating reports in connection to the alleged Africrypt scam from 2021 involving co-founder brothers Raess and Ameer Cajee.

The coverage states that Dubai-based investment company Pennython Project Management LLC approached a number of out-of-pocket investors of the exchange and attempted to offer a portion of the lost investment.

Following the offer from Pennython, the investors are now pushing for the arrest of both Raees and Ameer Cajee, whose whereabouts remain unknown.

Lieutenant Colonel Philani Nkwalase from the Hawks police unit disclosed that investigations are ongoing, and the police plan to work with the multiple victims of the case. Regarding the official value lost to the alleged fraud, Nkwalase stated that relevant financial records continue to be analyzed, and the exact figure remains unknown.

The Cajee brothers are still untraceable since April 2021, when about 69,000 bitcoin (BTC) mysteriously disappeared from the Africrypt exchange. Suspicions soared after Ameer, the Chief Operating Officer of the platform, issued a statement explaining the situation as a hack and urged customers to avoid reporting to the authorities.

Some investors were reportedly unsatisfied and hired law firm Hanekom Attorneys to look into the incident. Hanekom discovered that Africrypt employees lost back-end access seven days before the supposed hack, followed by the transfer of missing funds via mixers or to other large pools of BTC, which made the funds harder to trace.

More Regulatory Policies Needed as Crypto Adoption Soars

South Africa’s lack of cryptocurrency regulatory policies could prove a stumbling block in ongoing investigations into the Africrypt Saga. As the head of enforcement at the country’s Finance Sector Conduct Authority (FSCA), Brandon Topham said last year, crypto assets do not fall under the category of recognized financial products.

However, the FSCA also announced plans to introduce a regulatory framework designed to offer some protection for digital asset holders in South Africa.

This comes as no surprise as digital asset usage continues to grow across the continent. According to data from Chainalysis, Africa experienced a staggering 1,200% rise in crypto adoption in 2021 alone.

Also, a survey by London-based firm Luno revealed that 50% of Africans invest in cryptocurrency to pay for their children’s education. This further reinforces the narrative that crypto is growing in Africa.