FSCA fines Africa Bitcoin Corp founder and two others R10 million for manipulating Altvest shares
Image: Africa Bitcoin Corporation | Design: Mariblock
The signal
The trades predate the Bitcoin pivot by three years, and the FSCA acted against individuals, not the company. Still, Africa's first listed Bitcoin treasury company has lost its founder and CIO to 20-year bans, and its director of Bitcoin strategy is running it while they fight the orders.
South Africa’s Financial Sector Conduct Authority has fined the founder of Africa Bitcoin Corporation, its chief investment officer and its head of investor relations a combined R10 million and debarred them for 20 years each for manipulating the company’s share price in 2022, when it traded as Altvest Capital, the regulator said Sept. 3.
The details: The FSCA found that between Sept. 5 and 8, 2022, CEO Warren Wheatley, his wife, Tatum Keshwar-Wheatley, and chief investment officer Akshay Karan coordinated trades that inflated the price of Altvest shares or gave a false picture of demand for them. The shares were then listed on the Cape Town Stock Exchange.
- The regulator said the conduct breached section 80(1)(a) of the Financial Markets Act, which prohibits market manipulation.
- Wheatley owes R5 million jointly with WGW Capital, his company, which held 34% of Altvest and executed his trades. Keshwar-Wheatley owes R3 million jointly with her company, Tatum Keshwar Investments, which held 17%. Karan owes R2 million.
- The debarments stop all three from providing financial services, holding key positions at financial institutions or serving them.
Why it matters: Africa Bitcoin Corporation is Africa’s first listed Bitcoin treasury company, a strategy Wheatley announced last September with a plan to raise $210 million to buy Bitcoin. It trades on the JSE, A2X and the Namibian Securities Exchange.
- In a JSE notice on Tuesday, the company said the FSCA acted only against individuals and made no finding against any group entity. Until the regulator published its reasons, the company had not said what the case involved.
Catch up quick: The board learned of the decisions on Aug. 30. The next day it placed Wheatley and Karan on precautionary leave, suspended Keshwar-Wheatley’s consulting services and named Stafford Masie, its director of Bitcoin strategy, interim CEO. Wheatley resigned from the board.
- All three dispute the findings and intend to ask the Financial Services Tribunal to reconsider and suspend the orders. The tribunal has granted nothing yet, and the orders stand.