Pyramid scheme comes tumbling down: six arrested

The police arrested six directors of Krion Financial Services—an alleged pyramid scheme—on Tuesday, and seized assets of 45 agents of the firm in five provinces, detective services’ Martin Aylward said.

Aylward said the arrests followed an investigation ordered by the Reserve Bank more than a year ago.

“Following this investigation a case of fraud, theft and contravention of the Banking Act was reported the South African Police Service during March 2002,” he said.

Preliminary investigations indicated that between 20 000 and 30 000 investors had invested an estimated R980-million.

Aylward said the directors of the scheme had, in typical pyramid scheme fashion, used the investors’ money to maintain their own “lavish lifestyles”.

The allegedly illegal operations were believed to have been going on since 1995, operating under different names—Madikor20, Marburt Limited, MP Finance, and more recently Krion Financial

Services.

Krion was liquidated on July 2 this year.

The six directors who appeared in the Vanderbijlpark Magistrate’s Court on Tuesday were Maria Johanna Prinsloo (48) Herbert Henry Prinsloo (59) Marika Johanna Leemstra (30) Gerhard Leemstra (33) Willem Jacobus Pelser (27) and Isabel Engelbrecht, (32).

All six applied for bail, but the magistrate reserved a decision until Wednesday.

Aylward said investigations would continue. - Sapa

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