Batswana at risk of being scammed by unscrupulous forex traders
- NBFIRA not empowered to regulate forex traders
- Bank of Botswana can only intervene when there is illegal deposit taking
Financial regulatory organizations, Non-Bank Financial Institution Regulatory Authority (NBFIRA) and Bank of Botswana (BoB) are not be able to protect Batswana from possible scams and fraud by companies or individuals masquerading as forex traders.
The long and short of the responses of the two institutions to Gazette Business was that they do not have the authority to preemptively intervene in the interest of the public to avoid them losing money to illegal forex traders. The enquiry stemmed from the recent social media buzz about a South African forex trader Refilwe Nkele Wayne also known as Ref Wayne, whose credibility is questioned after he opened “Pipcoin Scheme” operations in Botswana.
NBFIRA last week revealed that it does not have powers to regulate and investigate forex trading and such could not authenticate claims against Pipcoin or stop it from operating in Botswana: “We can’t stop the business but we can only caution people to be careful when investing their money in the schemes. We don’t have any powers to regulate and its Bank of Botswana who regulates the business.”
Despite being tossed the gauntlet, the Bank of Botswana itself revolved the door of responsibility to the Botswana Police who they seem to believe are the appropriate authority to investigate Pipcoin and forex trading issues. A source within BoB said the bank can only intervene when there is illegal deposit taking.
Independent local consumer rights advocacy, Consumer Watchdog, were the first to point out the red flags over the scheme, warning the public not to invest money in it saying it was created solely to swindle money from unsuspecting victims.
Thulani Maphiliba, an individual who claims to know Ref Wayne also raised the same concern, saying Pipcoin was a scam and has no servers, meaning that its cofounders use laptops to control operations despite them claiming their system is decentralized.
According Maphiliba, Pipcoin is not a cryptocurrency but an imitation of MMM with a few adjustments mean to deceive people into believing it is legitimate.
“Eventually the money ends up on his personal bank accounts. I already have two people that have come forward and are willing to testify that their accounts were also used to ship money around,” reads part of a public letter Maphiliba put out in which he claims the scheme owner has multiple bank accounts with different names and that he moves money through his “syndicate”.
While Ref Wayne did not respond to questions sent to him by this publication last Wednesday, he appears to blame the bad rap he is getting on other individuals and organizations who he says scam people using his names. The scammers, he wrote, were also responsible for creating a fake Ref Wayne Facebook page and using a Botswana Stock Exchange logo
While he says Pipcoin is not a ponzi scheme or investment company, he did not disclose how his business generates money. He however says his ambition is to teach and produce at least 10 000 profitable forex traders in Botswana by the end 2017.
Co-founder of a local forex trading company, Kikase Forex Trading, Kitso Segolodi has however cautioned the public about the increasing number of South African fraudsters who target countries like Botswana where people do not understand how forex trading works. He explained that forex trading is a business not a quick fix of financial problems contrary to the impression created by scammers who flaunt money to portray an unrealistic picture about returns on investment.