The former chief executive of VaultAge Solutions has reportedly gone into hiding in order to avoid investors left out of pocket.
As reported by News24, Willie Breedt, the founder of VaultAge Solutions, was declared bankrupt last week and investors are now faced with the loss of 227 million in South African rand ($13.3 million).
Approximately 2,000 investors poured funds into the company, which promised to act as a "digital vault that grows wealth over time," aiming to "alleviate financial strains from individuals, entrepreneurs, investors, and communities."
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While the company described itself as a media and events entity, VaultAge Solutions also offered a platform for traders to invest in Bitcoin (BTC) and alternative cryptocurrencies.
Several weeks ago, Breedt went into hiding after some investors called for debt collectors to find the executive and recover their funds, News24 reports. Before vanishing, Breedt informed local police that he was being intimidated.
One of the investors in the now-defunct company reportedly handed over 7.5 million rand ($440,000) to Breedt, but when growth failed to materialize and investment pledges were not honored, then filed a complaint with the Gauteng High Court in Pretoria.
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An insolvency order was granted. In addition, to this order, two bank accounts reportedly belonging to the company have been frozen.
The publication says that PricewaterhouseCoopers has been appointed by the South African Reserve Bank to investigate the matter, including how agents were used to sell cryptocurrencies.
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In related news, at the beginning of this month, the UK government's Insolvency Service said GPay, a company trading as XtraderFX, had been ordered to close and wind-up due to the loss of £1.5 million ($1.8m) in investor funds.
Prosecutors said the cryptocurrency firm promised an easy platform for trading, but customers that chose to invest were often unable to withdraw funds. Celebrity images were fraudulently used to advertise the scheme across social media channels.
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