FSCA cautions South Africans against WhatsApp investment fraud

The Financial Sector Conduct Authority (FSCA) has issued a strong warning to South Africans not to engage with a WhatsApp-based syndicate falsely claiming ties to both the FSCA and the Johannesburg Stock Exchange (JSE).

According to the FSCA, the group, operating under the name A503 Stock Growth Community and boasting around 222 members, is misrepresenting itself as being affiliated with the country’s financial regulatory bodies. Its alleged leader, Mark Randall (45), is fraudulently presenting himself as the chief investment officer for Information Services at the JSE in an attempt to promote illegitimate investment schemes and solicit funds from unsuspecting individuals.

The JSE has confirmed that neither Randall nor the group has any association with the exchange, and that the claims are entirely false, it says.

The FSCA says the group is operating without the required authorisation and is unlawfully using the names of both the FSCA and the JSE to gain credibility and lure members of the public into parting with their money. The regulator further noted that the unauthorised use of the JSE’s name and trademark is in direct violation of Section 4(2) of the Financial Markets Act, 2012 (Act No. 19 of 2012), which prohibits any person who is not a licensed exchange from representing themselves as one or implying any association with a licensed exchange.

In light of this, the FSCA is urging South Africans to exercise extreme caution before transferring funds to any bank account. Individuals are advised to verify that the account is registered in the name of the entity it claims to represent and to request supporting documentation as proof of legitimacy.

The public is also encouraged to confirm whether an individual or entity is authorised by the FSCA to provide Financial Advisory and Intermediary Services. It is essential to understand the specific category of advice they are licensed to offer. In some cases, individuals may be registered to provide basic advice on low-risk products but unlawfully offer services involving more complex and high-risk financial instruments.

The FSCA reiterated the importance of conducting thorough due diligence before engaging in any financial services. Members of the public are strongly advised to verify:

• Whether the entity or individual is authorised by the FSCA to provide financial products and services, including investment recommendations;
• The category of advice the person is registered to provide.
• That the Financial Services Provider (FSP) number used by the entity or individual matches the name of the FSP listed on the FSCA’s official database.

For more information or to verify a financial service provider, the FSCA’s website offers a searchable database and guidance on how to report suspicious activity.

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