Angry mob sets fire to man's home after his ponzi scheme crashes

Angry mob sets fire to man's home after his ponzi scheme crashes

- An angry mob has set alight a man's home after his 'ponzi' scheme collapsed

- The crowd took to his house after hearing that he has lost all the investors' money

- The man managed to evade the mob and is nowhere to be found

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The events began unravelling on Tuesday night after Sphelele “Sgumza” Mbatha announced on a local radio station, Nqubeko FM, that the Bitcoin Wallet’s website was allegedly “hacked” and investors’ monies had been paid into fraudulent accounts.

This news angered many from the Tsakane township in Ladysmith, who had invested their money with Sgumza, so they took to his home to set it alight. A luxury BMW parked in the garage was also set on fire.

Hundreds of people flocked to the Ladysmith police station after messages circulated on social media that Sgumza had been taken into custody after trying to make a run for it.

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However, police denied having any knowledge of the man's whereabouts.

For months now, Mbatha’s scheme, known as Bitcoin Wallet, has caused a stir in Ladysmith by promising to pay 100% returns on monetary deposits in only 15 working days.

He also built a reputation for enjoying the luxury lifestyle. He would carry large sums of money and throw lavish parties. He even paid for other people's grocery bills.

He was given the nickname “Lord of Ladysmith” because people began to see him as their answer out of poverty.

People who love easy money were lured into depositing their money into the investment scheme, with some investing as much as R100,000.

The popularity of Bitcoin Wallet saw hundreds of people flocking to Ladysmith from all corners of KwaZulu-Natal to be first in line. But this caused disturbances and resulted in municipal by-law violations, forcing Sgumza to close down and to reportedly start trading online to avoid traffic into his business premises.

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After claiming on radio that his business website had been hacked, community members and investors became wary. They began looking for him so they could take back their investments, but he was nowhere to be found.

According to the Ladysmith Gazette, Sgumza admitted that he doesn’t have any more cash to pay out to clients and he claimed that he was just a manager, not the owner, of the investment scheme.

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