Ponzi investors stranded as managers close shop

People who deposited funds at KWD Digital Marketing in a suspected Ponzi scheme in Gunhill, Harare, were yesterday plunged into quandary after finding the company’s branches shut without proper communication.

This followed investigations by the police on the legality of the company’s operations.

Police have since launched a manhunt for three directors of KWD whom they want to interview over the scheme, under which investors were promised double their deposits in a month.

Conflicting notices without date stamps were seen on the trees and walls at Number 147 Freedom Legacy (formerly Borrowdale Road) in Gunhill, referring investors to other branches, which were also closed.

“For deposits, go to 17785 Water Meyer Drive Belvedere” reads one of the hand-written notices.

Another typed notice advised the investors to wait until August 17 when business was expected to resume.

It read: “This week we are closed for maintenance of our system. Next update on Monday August 17, 2020”.

An irate investor who spoke to The Herald complained about poor communication.

“If you go to the said address in Belvedere, they will refer you to this place,” he said. “Now the challenge is that we no longer trust these people. Now, we are waiting for the said date to get our investment returns, but by the look of things, chances are high that we will lose out.”

Commenting on a WhatsApp platform created by the investors called “Kuwait and Bevern Investors”, investors expressed mixed feelings about the development.

The majority were afraid of losing ou,t while some were calling for prayers.

One of them said: “How come there is no official memo from these guys? I can smell a rat.”

Another one said: “I am in Belvedere now and there is no one to attend to us. The gate is closed. A security guard told us that they will open on August 17.

“I hope they are not playing games with us. I think we should all go to Belvedere and see if there is any progress.”

The investors have over the past weeks been flocking to 147 Freedom Legacy Way in Gunhill to deposit up to US$10 000 each after being promised that they would receive twice as much after four weeks, something that is impossible in a normal investment business.

Detectives working with the Reserve Bank of Zimbabwe (RBZ), have launched an investigation into the operation, with initial charges being contravention of the Banking Act as the investment managers offering banking services without a licence.

It is suspected the directors were simply paying off original investors with money brought by new investors, while taking a large cut for themselves.

They could also face fraud charges.

KWD employees, including managers, were on Thursday last week picked up by police for questioning.

Police spokesperson Assistant Commissioner Paul Nyathi said two of the directors are reportedly in South Africa, while the other one, Mpumelelo Dube, who was local, cannot be found.

Investment schemes of that nature require a banking licence and the RBZ’s Financial Intelligence Unit and other law enforcement agents have since launched investigations into the entity.

The central bank has urged potential investors to carry out due diligence before giving away their money.–herald.cl.zw

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