The Pretoria Asset Forfeiture Unit (AFU) of the National Prosecuting Authority (NPA) obtained a preservation order to freeze the bank account with over R4.3 million belonging to Piggy Farm Trading (Pty) Ltd.
On Wednesday, NPA spokesperson Lumka Mahanjana said the company ran a Ponzi scheme where people went on a digital platform called Metaverse Piggy Farm and were able to purchase up to 50 virtual pigs at R2,750 per pig.
“As it is a virtual pig, the investment is risk-free because the pig gets substituted with another pig in the event it dies. In return for investment, the investor will be paid R550 per month for 12 months, and after 12 months, the pig will be returned to Piggy Farm trading,” Mahanjana said.
Mahanjansa said the National Consumer Commission (NCC) received complaints from investors and an investigation was initiated where they discovered that the company operated a multiplication scheme which offered an effective interest rate of 140%, which exceeds the repo rate by more than 20%.
“This is a contravention of the National Consumer Protection Act. In addition, further investigations by the AFU revealed that the whole scheme appears to be a fraud. The name and location of the so-called farm is never revealed on the website of Piggy Farm Trading or any of the social platforms where they advertised the scheme,” Mahanjana added.
Mahanjana said Piggy Farm only refers to an address in the Durban CBD and its different branches.
“It is, therefore, doubtful that a farm or even pigs, to the extent of the investments received, exist. The funds received as investments would suggest pig farming on a mega scale.”
Furthermore, Mahanjana said the business account of the company held over R16 million in February 2024.
“The AFU therefore concluded that there is no underlying business model and that incoming investors were paid from previous investments to keep the scheme going.
“This carries the hallmarks of a classic Ponzi scheme. The scheme is unsustainable, as it is bound to implode when no new investors are forthcoming, with the majority of investors losing their money,” Mahanjana said.
Meanwhile on the company’s website, it said that the business was formed by three young agricultural entrepreneurs, Mthokozisi, Sphamandla, and Siyabonga Ngcobo, who are based at Molweni, Hillcrest in KwaZulu-Natal.
It was also mentioned that the company was established in 2021 during the pandemic with the purpose of giving hope and to assist in economical restoration and job creation for despondent communities.
-IOL News
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