Stock Image Pixabay
The Pretoria Asset Forfeiture Unit (AFU) of the National Prosecuting Authority (NPA) obtained a preservation order of over R4.3 million to freeze the bank account belonging to Piggy Farm Trading (Pty) Ltd.
NPA spokesperson Lunka Mahanjana says the company ran a Ponzi Scheme where individuals would purchase up to 50 virtual pigs at R2 750/pig.
She says this was a digital "Metaverse Piggy Farm" where the investment was promised to be risk-free because "dead" pigs could just be substituted with another one.
Investors were paid R550 p/month for 12 months before the virtual pig will be returned to the company.
Mahanjana says investors complained to the National Consumer Commission (NCC) which initiated an investigation.
She says during their investigation they discovered that the Farm Trading operated a multiplication scheme that offered an effective interest rate of 140%, exceeding the repo rate by more than 20%.
The NPA says this is a contravention of the National Consumer Protection Act.
Piggy Farm only refers to an address in the Durban CBD on its website raising questions about the existence of such a farm.
Mahanjana says as recently as February 2024, the business had R16 million in its account.
She says the AFU concluded that there is no business model and that investors were paid from previous investments to keep the scheme going, the hallmark of a classic Ponzi scheme.
The NPA says the scheme is bound to implode as the model is unsustainable and most investors have already lost their money.
The AFU urged investors to open criminal cases against the company, as the preservation order was granted under the implementation of Chapter 6 of POCA, which is a non-conviction-based approach to asset recovery.
This means that the AFU will not always wait for prosecution and conviction to occur before taking away suspected proceeds of crime.
According to the Piggy Farm website, the scheme was the brainchild of three young agricultural entrepreneurs, Mthokozisi, Sphamandla and Siyabonga Ngcobo, based in Molweni in the vicinity of Hillcrest (KZN).
It further states that the company was established in 2021 during the harsh COVID-19 lockdown.
It further claims to have grown into a trusted entity, committed to the creation of new job opportunities
