SA's financial regulator has fined the directors of the Praesidium group of companies millions of rands and barred them from the financial services industry for offering investments ‘similar in nature to a Ponzi scheme’, reports Fin24.

The Financial Sector Conduct Authority (FSCA) yesterday announced that its investigation of Praesidium Advisory Services, Praesidium Wealth and Praesidium Sentinel concluded that the companies contravened numerous financial sector laws.

All three have already been liquidated.

In addition to the fines and debarments announced yesterday, the FSCA said it would refer the matter to the police as it ‘seems likely that several offences have been committed, including fraud and theft.’

The FCSA’s probe, which has been ongoing since September 2020, chiefly focused on foreign currency trades undertaken by Praesidium Advisory Services.

It found that the group traded forex on behalf of clients without having a licence.

It also did not have the correct licence to receive client funds to invest in forex instruments.

Praesidium Advisory Services paid over the funds it received to two companies called Octox and Imagina FX, which were not authorised financial services providers.

Both companies were linked to Praesidium director Craig Massyn.

According to the FSCA, Massyn ‘controlled’ clients' bank accounts via Octox and traded their funds via the Imagina FX trading platform.

Instead of paying clients from forex profits as he professed to do, the FSCA found Massyn paid them from the money they had invested: Massyn has been fined R20m and barred from the financial services industry for 20 years.

His two co-directors, Andrew Cunningham-Moorat and Brett Bukes, were fined R2.5m and R6.5m respectively.

Both were barred for 10 years.

Two employees of Praesidium, Cindy Lee Schuster and Ryan van Niekerk, were both fined R300 000 and barred for five years.

Full Fin24 report