One of South Africa’s Bitcoin Brothers arrested written By Jan Vermeulen

[Nat Quinn]

South Africa’s infamous Bitcoin Brothers — Raees and Ameer Cajee — are under criminal investigation in Switzerland after one was arrested while trying to access safety deposit boxes they rented in Zurich.

MyBroadband contacted Swiss authorities for details about the arrest, which the Public Prosecutor’s Office of the canton of Zurich confirmed. It also confirmed that the brothers remain under investigation for money laundering.

The Cajees fled South Africa in 2021 when an alleged Ponzi scheme they had been operating since 2019 called Africrypt collapsed. Their whereabouts have been unknown until now.

Africrypt allowed people to deposit South African rands or cryptocurrency and earn outsized monthly returns on their investments.

The brothers promised investors that Raees had developed revolutionary artificial intelligence cryptocurrency trading software that could generate consistent monthly returns.

An investment presentation from around September 2020 claimed that the scheme achieved returns as high as 13% per month for clients on its “Aggressive” plan.

Africrypt earned the Cajees enough money to live large — reportedly driving around in a Lamborghini Huracan and taking up residence in the luxurious Houghton Hotel.

However, it all came crashing down on 13 April 2021 when the brothers notified investors that Africrypt had been hacked and all its cryptocurrency holdings stolen.

The story flew under the media radar until June 2021 when Bloomberg reported that the brothers had gone missing along with $3.6 billion (R54 billion) in crypto assets.

This initial estimate of the amount stolen turned out to be completely inaccurate.

The inexperienced crypto sleuth who was hired to investigate the scam by victims’ lawyers had traced the Bitcoin deposits made into Africrypt’s account to a wallet address that had received 69,000 bitcoins.

This was worth $3.6 billion (R54 billion) at the time, leading to dramatic headlines.

However, former Luno financial crime investigations team lead Chris du Toit said the sleuth had made a massive blunder — the wallet address actually belonged to a cryptocurrency exchange.

Although Du Toit didn’t name the exchange, MyBroadband has since established that the wallet address in question belonged to Luno.

It is unknown how much money the Cajees got away with, although Raees later told the Wall Street Journal that less than $5 million (R75 million at the time) was lost when their platform was hacked.

Then, in mid-November, an anonymous investor offered victims a $5 million deal in exchange for dropping the criminal charges against the brothers.

It has now emerged that this was around the same time one of the brothers was arrested in Zurich — just months after they fled South Africa.

Cajee brothers standing in front of an Africrypt-branded van

Swiss authorities have not publicised the arrest and only a handful of Swiss German-language news publications carried the story.

The first report about the arrest was published by the newspaper Schweiz am Wochenende (Switzerland on the Weekend) almost 18 months after it happened.

According to the paper, the Public Prosecutor’s Office learned that the Cajees had rented safety deposit boxes and stored their hardware wallets in them. Hardware wallets are used to securely store crypto assets like Bitcoin.

The Public Prosecutor opened an investigation on suspicion of money laundering against the Cajees. It lay in wait at the safety deposit boxes and arrested one of the brothers while he was trying to access them.

Cajee spent around six months in pre-trial detention and was reportedly released on bail of 300,000 Swiss francs (around R5 million at the time).

As part of his bail conditions, Cajee had to surrender his passport and agree to remain in Switzerland.

He fought his bail conditions all the way to the Federal Supreme Court, which dismissed his complaint.

The court ruled that for a wealthy individual, being required to stay in Switzerland longer than planned is not a disproportionate restriction of freedom.

Spokesman for the Public Prosecutor’s Office of the Canton of Zurich, Erich Wenzinger, confirmed many of these details to MyBroadband.

However, he did not disclose how much money was seized, which brother was arrested, or what the status was of the case against them.

“We can confirm that the Public Prosecutor’s Office of the Canton of Zurich is conducting a criminal investigation against the two brothers you mentioned on suspicion of money laundering,” Wenzinger told MyBroadband.

“One of the brothers was arrested in Zurich in November 2021 and spent around half a year in pretrial detention. He was released on bail.”

Wenzinger said no further arrests were made in the case, which means no one else is currently in custody.

“We can also confirm that items related to an alleged fraud case in South Africa, namely Africrypt, were seized in Zurich,” he said.

“The presumption of innocence applies until a legally binding conclusion of the proceedings is reached,” Wenzinger continued.

“As this is an ongoing matter and for personal data protection reasons, we will not provide any further information.”

MyBroadband contacted the Cajee brothers for comment, but they did not respond by the time of publication.

We also contacted the Hawks for an update on its investigation, but its national media liaison did not respond by publication.

 

source:One of South Africa’s Bitcoin Brothers arrested – MyBroadband

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