Ten months since the Saturday Star revealed the investigation into rare metal investment company Global Electio Investments, four of its top leadership have been arrested, including two former directors.
The company, suspected of defrauding hundreds of unsuspecting South African clients out of an estimated R500million, promised growth interest rates of up to 23%.
In January, the Hawks revealed it had entered into a joint probe with private firm IRS Forensic Investigations, after 30 clients came forward claiming it had defrauded them.
For years, the company used boiler-room style tactics, calling up potential investors across South Africa to aggressively sell “baskets” of earth metals that would be stored in Dubai as their value increased.
The most basic package, the defence basket, which held materials used in military vehicles, sold for R43000.
The green energy basket, holding metals used in solar panels, went for about R50000.
The future tech basket, which supposedly held metals used in PlayStations and home appliances, went for almost R100000 and the smartphone basket went for R500000.
On Tuesday, former company director and Iranian national Jalil Motazedi was arrested, alongside three South Africans, director Ian McGregor, Kyle Pillay and Shaunita Singh.
While the four have been charged with 24 counts of fraud based on 24 former clients, it is understood police investigators and the State prosecutor are still canvassing other investors to increase the number of charges.
The group appeared at the Specialised Commercial Crimes Court in Johannesburg on Wednesday, when McGregor, Pillay and Singh applied for bail. Represented by Johan Eksteen of BDK Attorneys, all claimed innocence, saying they wished to clear their names in court.
The trio were prepared to hand over their passports and were granted bail. However, Motazedi was unable to continue with his bail application due to his status as a foreign national, with his proceedings set to continue on Wednesday.
IRS director Chad Thomas said the arrests were a joint effort with the Pretoria K9 Unit, and the Joburg Hawks Commercial Crimes Unit.
“IRS has been investigating this case since late 2016. Multiple case have been opened and several suspects have been identified in multiple jurisdictions, including Spain, Serbia, the UK, Hong Kong, Dubai, and South Africa.
“The majority of the South African suspects were proxies for the international syndicate,” said Thomas.
Although the local employees acted as proxies, the majority of the South African suspects realised the company was engaging in fraud, he said.
“Some suspects made voluntary statements whereas other suspects approached a law firm only after cases had been opened and then submitted statements to the Hawks, claiming to be whistle-blowers,” he said.
“ Who we believe the mastermind of the fraud, Arthur Jan Olivier Lodder, is still at large. He is a Dutch citizen, who has been spotted in Spain and Serbia. We are hoping our law enforcement agencies will approach Interpol to authorise an international Red Notice.
“We expect several more arrests in the coming months, notably of other local South African suspects.”