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ImaginaFX founder Craig Massyn defends quarantine attempt

The liquidator of Imagina FX, a failed investment company that was finalized in November 2020, aimed at its founder and chief operating officer, Craig Massyn.

He applied for the isolation of Massin and his wife Marary in the Cape High Court, based on two claims by two companies, Imagina FX and Octox, which were previously under his control, of Rand 9.1 million and Rand 5.7 million.

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The liquidator claims that Massin is bankrupt and unable to pay the debt. Massyn opposes the application, claiming that this is an abuse of court proceedings and has not gone bankrupt, but presumes that his filing in court owes the liquidator to the investor. It doesn’t show anything about what happened to R2 Billion.

Moneyweb previously reported on failed investment schemes traded under various names such as Imagina FX, Praesidium and Octox.

According to liquidators, the company was able to attract more than R2 billion from investors, with apparent annual revenues of 43.5% and even 74.3% in a year.

According to the liquidator, this was all just a Ponzi scheme, with new investor funds being used to pay for old investors.

Things began to unravel when Covid hit last year

The company has accused the “Black Swan” event of a 40% reduction in assets under management. Just a few weeks after the announcement of “Black Swan,” things seem to be back on track. On May 26, 2020, investors were informed that the month’s return would be approximately 1.5%. This was a mistake, says the liquidator.

Some investors became nervous and began asking them to get their money back. Their withdrawal request was met with a series of messages explaining the technical and regulatory hurdles that had to be overcome before the money was released.

In a letter to creditors on March 9, this year, Imagina FX co-liquidator Christian Bester believed that this was an Imagina FX bank account, and many investors funded Octox’s FNB bank account. I advised you to pay.

“During the investigation, we found that a total of 1.5 billion Rands had been deposited in Octox (Pty) Limited’s bank account. Octox’s provisional liquidation application was initiated and approved on December 9, 2020. The final liquidation was approved by the West Cape High Court on 22 January 2021. ”

Quarantine request

The liquidators of Imagina FX and Octox are now asking the High Court to quarantine Massyns and hold them personally liable for both Imagina FX and Octox debt and liabilities with respect to Section 424 of the Companies Act 1973.

On October 27, last year, a liquidator was given an order by Anton Pillar to search (without warning) the offices and residences of company directors for information about the whereabouts of the missing money. ..

Massin alleged that Anton Pillar’s orders had been illegally enforced and filed a proceeding on February 25, 2021 in an attempt to overturn them. The court rejected Massin’s application, which he is currently suing.

Of the R15bn paid to the Octox bank account, only R21k remained

From July 2014 to October 2020, approximately R $ 1.5 billion was paid to Octox’s FNB account, according to the liquidator’s court filings. By October 2020, there were only about R21000 left in the account. In total, over 2 billion Rands have been received in both Imagina and Octox bank accounts.

Where did this money go?

Massin’s response affidavit in the quarantine case provides few clues. Last year, the Financial Sector Action Authority (FSCA) warned investors that most of their money could be lost. This seems to have been confirmed by Massin himself and a subsequent statement from Prims Markets International, the foreign platform Massin uses for forex trading.

Antoine Papayya was registered as Octox’s only director, but Massyn was the only person to manage its bank account. (Co-liquidator) According to Vester’s affidavit, he trades in an Octox bank account by fraudulently stating to the FNB that he was a director of the company when he was not a director. I got the only permission.

Neither Imagina FX nor Octox were registered as financial institutions, banks, depositors, or financial services providers, nor were they compliant with the Collective Investment Scheme Management Act.

We also did not edit the financial statements as required by the Companies Act.

“Completely uncooperative”

“Massin was completely uncooperative in the liquidation of Imajina FX’s operations,” Vester testified.

“He also gave a contradictory explanation of whether the money was left and where the money was.”

Investors were fascinated by the promise of a 39-42% annual return, which seems to be the way it was able to pay older investors. A large fee was also paid to those who introduced new investors.

According to Vester’s affidavit, Massin alleges that in addition to managing the company’s bank account, he has misused a large amount of money for his own benefit.

At one point he paid Papaya 2.4 million rants. “Papaya seems to have closed his eyes to the abuse of Octox’s bank account.”

Despite apparently roasting the rest of the market with 39-42% returns over the last five years, Covid arrived and caused a 40.3% drawdown by May 5, 2020 “Black” It was a “Swan” event.

But things got back on track within a few weeks. On May 26, 2020, investors were informed that the month’s return would be approximately 1.5%. This was a mistake, says Vester.

Forex trading freeze

On July 17, 2020, Massyn and Imagina lawyers Enderstein & Van Der Merwe (EDVM) held a total of approximately $ 42 million in Cyprus-based forex trading broker Primus used by Massyn. Wrote a letter to Praesidium. ..

By July 2020, Primus lawyer Chrysses Demetriades told Imagina’s lawyer that “there is strong evidence that clients were providing false information to each client at the investment level.” Notified that all trading accounts have been frozen.

Massyn later confirmed in an email to the lawyer that “most of the money was gone.”

When adjusted by Primus, it turned out to be less than € 120,000 as of July 2020.

“Massin seems to have been able to not only tamper with the account balance, but also relocate the account name and number,” says Vester. “Massyn has explicitly manipulated the balance on the account statement. As a result, he did so to deceive the FSCA and deceive investors.”

Massin’s trick

Massyn has five categories of investors, each of whom is likely to receive different percentages of returns on their investments. Investors did not have separate accounts as the company promised, but Massyn was pooled with a percentage return assigned to each group. According to Vester’s affidavit, Imajina’s fellow director, Karl Jaftes, has never seen evidence of actual transaction results.

“The inevitable conclusions drawn from the facts and documents obtained by the applicant so far are that the investment schemes created and managed by Imagina FX, more specifically Massyn, are only illegal and fraudulent Ponzi-type schemes. No. Massyn knew that Imagina FX could never respect the returns promised to clients / investors and that the entire scheme would inevitably collapse. [as it eventually did] And many clients / investors will incur huge losses. ”

14 transactions from Imajina to Massin’s Reno account paid 6.67 million rand, one by Ricky Lee Ann Vosru, of which 4.17 million rand was transferred to Massin’s Reno account. Massyn bought and sold Bitcoin through his personal Luno account, withdrew funds from his account, and then paid to his personal bank account. He has never paid for Imajina’s bank account.

Japhtes also received R4.86 million from Imagina into his personal Luno account, bought Bitcoin and transferred it to Massyn’s wallet.

So far, 85 claimants have claimed R94.6 million worth, which will definitely increase as Imagina and Octox’s total debt is known to exceed R11.5 billion.

Massin said that the liquidator was abusing court proceedings in an attempt to file a quarantine application against him, and that he was already engaged in a wide range of proceedings related to the liquidation of the company in which he was involved. I answered with the documents submitted by the court.

Vester has several ways to postpone the proceedings, remove the subpoena, or suspend the proceedings filed in court because Massin did not testify in the inquiry in Section 417/418. I answered that I submitted the application for.

“The applications provided by Massyn have one purpose: to be non-accountable.”

The quarantine application will be heard in court next week.

read: FSCA cracks down on Bitcoin on suspicion of Ponzi scheme

ImaginaFX founder Craig Massyn defends quarantine attempt

Source link ImaginaFX founder Craig Massyn defends quarantine attempt

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