Three FSPs’ licences, branding abused in social media investment scam

Posted on by

The Financial Sector Conduct Authority (FSCA) has warned the public not to conduct financial services-related business with individuals who are soliciting investments by impersonating three authorised financial services providers (FSPs): Rich Ideas Group (Pty) Ltd, (FSP No. 50569), IC Markets (Pty) Ltd, (FSP No. 50715), and Scope Markets SA (Pty) Ltd, (FSP No. 47025).

Rich Ideas is an independent financial planning firm based in Randburg. IC Markets is an online trader authorised to provide derivatives and forex investment services. Scope Markets offers institutional and retail trading services to businesses and traders.

This is not the first time the FSCA has warned the public about an impersonation scam involving IC Markets. In March last year, the Authority said individuals were purporting to be IC Markets representatives on WhatsApp and Facebook, to pry “investment” money out of members of the public.

In a statement this week, the FSCA said it has come its attention that an entity named “Wealthfront”, Franz Wastl, David Daniel Venter, and Roelof Johannes Riekert, as well as individuals named “George” and “Helena” are targeting people using WhatsApp and Facebook. They are soliciting investments by claiming to be associated with the FSPs and promising unrealistic returns, the Authority said.

The FSPs are not associated with the abovementioned parties and did not give permission for their licence certificates, brand names, and logos to be used.

The parties are not licensed under any financial sector law to provide financial products or financial services in South Africa. “The parties did not respond to communication from the FSCA,” the Authority said.

Namco Guarantees

The FSCA has also warned the public to be cautious when taking up guarantee insurance policies issued by Namco Capital (Pty) Ltd trading as Namco Guarantees.

The Authority received a complaint that Namco may be issuing guarantee insurance policies to members of the public that are possibly not underwritten by an authorised short-term insurer.

“Without commenting on the business of Namco or its products and services, the FSCA points out that for a company to issue insurance policies in South Africa, it must be authorised by FSCA and the Prudential Authority. Conducting financial services business or insurance business without a licence is a criminal offence,” the FSCA said.

Namco is not so authorised and does not hold a licence from the FSCA to conduct financial services business. The FSCA is investigating Namco.

Check before you invest

The FSCA says members of the public should always check the following:

  • That an entity or individual is authorised by the FSCA to provide financial products and services, including for providing recommendations about how to invest.
  • The category of advice the person is registered to provide, as there are instances where companies or people are registered to provide basic advice for a low-risk product but advice on far more complex and risky products.
  • That the FSP number used by the entity or individual offering financial services matches the name of the FSP on the FSCA’s database.

You can check whether an entity or person is authorised to provide financial products and services by: