SAFLII Note: Certain personal/private details of parties or witnesses have been redacted from this document in
compliance with the law and SAFLII Policy




Republic of South Africa
IN THE HIGH COURT OF SOUTH AFRICA
[WESTERN CAPE DIVISION, CAPE TOWN]

Case no: 23249/2024

In the matter between:

CAROL MARGARET WENTZEL Applicant

And

BANXSO (PTY) LTD First Respondent

THE FINANCIAL INTELLIGENCE Second Respondent

FINANCIAL SECTOR CONDUCT AUTHORITY Third Respondent

NATIONAL DIRECRTOR OF PUBLIC PROSECUTIONS Fourth Respondent

HASSEN KAJIE N.O Fifth Respondent

And

In the matter between:

ECONOMIC FREEDOM FIGHTERS Applicant for Intervention

And

DAVID VAN DER MERWE First Intervening Party

NICK RICHARD WEGGELAAR Second Intervening Party

LEON ALBERTUS DE MAN Third Intervening Party

SAUL GEOFFREY RUDOLPH Fourth Intervening Party

BAREND UYS VAN NIEKERK Fifth Intervening Party

CORNELIA MAGDALENA HUMAN Sixth Intervening Party

THEO JOHAN SCHOEMAN Seventh Intervening Party

MARIANA MARYNA DUVENHAGE Eight Intervening Party

MARLEEN SMIT Ninth Intervening Party

CHRISTIAAN THOEDORE BRUYNS Tenth Intervening Party

Coram: LE GRANGE J
Delivered: Electronically on 22 August 2025

Summary: Provisional winding -up of Company - Application of t he condictio ob
turpem vel iniustam.

Judgment


LE GRANGE, J:

Introduction:

[1] In this matter the Applicant, Mrs Wentzel (Wentzel) seeks a provincial winding -up
order against the First Respondent, Banxso (Pty) Ltd (Banxso), on the grounds that:
Firstly, Banxso is unable to pay its debts as contemplated in s 345 of the Companies Act
61 of 1973 read with item 9 of Schedule 5 of the Companies Act, 71 of 2008; secondly,
it would be just and equitable to do so as contem plated in section 344(h) of the of the
1973 Companies Act with item 9 of Schedule 5 of the Companies Act, 71 of 2008,
alternatively in terms of s 81(c)(ii) and or section 81(1)(d)(iii) of the 2008 Companies
Act; and, thirdly it would be just and equitable to wind-up Banxso as it is promoted for
the purpose of perpetrating fraud or deception on investors.

[2] Wentzel, a pensioner lost approximately R500 000 as an investor in Contracts for
Difference (CFD) 1 on a platform managed by Banxso. At the heart of Wentzel’s
application is the allegation that all her and other investors transactions with Banxso are
null and void under the condictio ob turpem vel iniustam causam, (condictio ob
turpem)2. According to Wentzel, Banxso operated as a criminal enterprise with an
unlawful and illegal business model designed to defraud investors. Wentzel further
alleges that although she has no knowledge of other creditors, concurrent or otherwise,
more than 7000 investors including t he intervening parties, were scammed and all of

1 A CFD is an essence a speculative trading position as to the fluctuation in price of a particular
commodity (currency, shares or indices). If the client's position is that the price will go up, and does, they
will win and make a profit. Conversely, if th e client bets that the price will go down, and it goes up the
client loses and suffers a trading loss.
2 In Afrisure CC v Watson NO 2009 (2) SA 127 SCA at para 5, the CSA held that: the central requirement

of the condictio ob turpem vel iniustam causam, is that the amount claimed must have been transferred
pursuant to an agreement that is void and unenforceable because it is illegal, ie because it is prohibited
by law; Chevron SA (Pty) Limited v Wilson t/a Wilson's Transport and Others (CCT 88/14) [2015] ZA CC
15; (5 June 2015).

them have claims against Banxso. According to Wentzel it will therefore be reasonable
to conclude that Banso liabilities exceeds its assets by far.

[3] Banxso is a financial service provider (FSP) with a licence to act as intermediary
and opposed the relief sought. Banxso denies it is insolven t or operating a criminal
enterprise and regards Wentzel’s application, and that of the intervening parties , as an
abuse of process as it has t he necessary liquidity to pay all the alleged debt contained
within the present application. Banxso has also offered to secure the claimed debt of
Wentzel and all intervening parties. According to Banxso it had over R 26 million in its
operational account and a stakeholder trans ferred R500 000 into its attorneys trust
account as security for Wentzel’s claim pending the successful prosecution thereof and
the withdrawal of the current application. A stakeholder has also offered R57 125 588.80
in security on behalf of Banx so, being the total value of the intervening parties claim
pending the successful prosecution of those claims.

[4] It is common cause that Third Respondent (FSCA) which oversees the conduct
of FSP’s provisionally withdrew Banxso’s FSP licence on 15 October 2024 and finally on
4 July 2025. The latter occurred whilst judgment was pending.

[5] Before dealing with crux of the matter, the interlocutory applications launched by
the relevant parties will be considered first.

The intervening parties:

[6] The intervening parties sought leave to intervene in these proceedings as co -
applicants and creditors as contemplated in s 346(1)(b) of the 1973 Companies Act.
David Van Der Merwe (Van der Merwe) the first intervening party, filed an affidavit.
According to him Banxso, is not acting in the best interest of all its investors as it offered
security for the applicant’s claim on condition that she does not persist with the
liquidation application. Van der Merwe further recorded that Banxso wants to enter into

liquidation application. Van der Merwe further recorded that Banxso wants to enter into
settlement agreements with individual complainants which could frustrate investors who

support the liquidation but are not party to these proceedings, if accepted. Van der
Merwe further detailed how Banxso success managers traded in his name and caused
him to suffer losses in the amount of R1 500 000. It was further alleged that Banxso
allowed him to continue trading on its platform despite knowing the FSCA provisionally
withdrew its FSP licence on
15 October 2024.

[7] Banxso, opposed the application on the basis that it is an abuse of process.
According to Banxso it has given an undertaking to the intervening applicants attorneys
that it would furnish security to the aggregate value of the inte rvening parties’ net
deposit in the sum of R57 125 578,80 which was rejected. Banxso rejected Van der
Merwe’s claim that he never conducted trade in his own name. A copy of his trading
statement in support thereof was attached to the papers. According to B anxso, van der
Merwe’s trade was complex, erratic and needed high -level support due to his high -
volume trading activity. Banxso has also denied that funds deposited by Van der Merwe
after 16 October 2024 have been lost. According to Banxso, the full value of his
deposits will be available for him to trade or to withdraw when Banxso transfers his
account to a new FSP .

[8] Counsel for the intervening parties argued that they have established prima facie
proof of their interest and thus entitled to join thes e proceedings in terms of Rule 12 3 of
the rules of this Court.

[9] Counsel for Banxso disagreed and argued that: the failure by the intervening
parties to furnished security for wanting to intervene, is fatal to their application; they
also failed to show a direct and substantial interest in the matter which could be
prejudiced by the judgment of this Court; moreover, Van der Merwe’s failed to set out a

3 Rule 12. Intervention of persons as plaintiffs or defendants: Any person entitled to join as a plaintiff or

liable to be joined as a defendant in any action may, on notice to all parties, at any stage of the
proceedings apply for l eave to intervene as a plaintiff or a defendant. The court may upon such
application make such order, including any order as to costs, and give such directions as to further
procedure in the action as to it may seem meet. By virtue of the provisions of Rul e 6(14) this rule is also
applies to applications.

basis for his claim and his claim is reasonably disputed; Van der Merwe also failed to
allege he was a creditor of Banxso.

[10] The argument by Banxso ’s counsel is unpersuasive. It is not in dispute that
the intervening parties invested in Banxso. It appears on the allegations made by the
first, second, fourth, fifth and seventh Intervening Parties, they all have existing
liquidated claims against Banxso for repayment of the amounts they deposited
after the provisional withdrawal of Banxso's FSP license on the basis that, all
transactions post 15 October 2024, according to Banxso were simulated and all client
funds in relation to those trades, irrespective of purported losses, are still available. It
further appears that Mr. CT Bruyns, the eleventh intervening party, has an undisputed
contractual claim for repayment, which is due and payable. Furthermore, i f the
allegations are correct that Banxso conducted its business illegally and the
transactions between Banxso and its investors were void then all those investors,
including the intervening parties, have claims against Banxso for repayment of the
amounts that they invested.

[11] It follows that each individual intervening party do not have to furnish security
as they do not seek to launch separate application s for the winding - up of Banxso.
They want to be c o-applicants in accordance with section 346 (1)(b) o f the 1973
Companies Act which contemplates that one or more of a company's creditors may
be the applic ants in an application for the winding up of the company. In the present
instance there is only one application, as contemplated in s 346(3) and since Wentzel
provided security, no further security is required from each co-applicant.

[12] In my view the Intervening Parties have established a legally recognisable
interest in the outcome of this case and leave to intervene as co -applicants with the
existing applicant should be granted.

The Striking out:

[13] The Applicant and intervening parties sought the striking out of parts of Banxso’s
affidavits due to their apparent scandalous and vexatious nature and being irrelevant.
Banxso accuse the attorneys of the applicant and intervening parties (M&B) of being the
main driving force behind the application for their own interest and not for legitimate
creditors or their clients. M&B was further accused of unprofessional conduct (touting)
by creating a website to lure clients on the premise that they will recover money who
register on the website. It was also alleged the FSCA was unlawfully collaborating with
M&B to seek its liquidation.

[14] On the other hand, Banxso sought the striking out of parts of the applicant’s
affidavit in reply relating to transcripts of telephonic conversations between Banxso’s
clients, that of the applicant and transcripts of interviews that the FSCA had with
representatives of Banxso. According to Banxso the transcripts raised new matter which
is impermissible and s ome of the allegations in reply are also scandalous, vexatious
and irrelevant. More importantly, Banxso holds the firm view that the FSCA was not
legally obliged to comply with the subpoena duces tecum as such is not permitted in
motion proceedings.

[15] It is trite that i n terms of Rule 6(15) of this Court’s Rules , two requirements must
be met before a striking out application can succeed: firstly, the matter sought to be
struck out must be scandalous, vexatious or irrelevant; and secondly, the court must be
satisfied that if such a matter is not struck out the party seeking such relief would be
prejudiced4. The words ‘scandalous’, vexatious, irrelevant and prejudice are used
frequently in courts. The ir meaning is defined in the Shorter Oxford English as follows:
“Scandalous” allegations are those which may or may not be relevant but which are so
worded as to be abusive or defamatory; a “vexatious” matter refers to allegations which

worded as to be abusive or defamatory; a “vexatious” matter refers to allegations which
may or may not be relevant but are so worded as to convey an intention to harass or
annoy; and “irrelevant” allegations do not apply to the matter in hand and do not

4 See Rule 6(15) of the Uniform Rules of Court; Helen Suzman foundation v President RSA 2015 (2) SA 1
15 CC at para 28.

contribute one way or the other to a decisi on of that matter. ’5 The test for determining
relevance is whether the evidence objected to is relevant to an issue in the litigation.6

[16] On the papers filed, M&B only became involved after the applicant had lodged a
complaint with Banxso. The Applicant approached the attorneys and not the other wa y.
At all relevant times, M&B have been acting on the instructions of the applicant and, later,
the Intervening Parties . It is also common cause that M&B became involved on the
instructions of the applicant before the investigation of t he FSCA, the steps taken by
them and other agencies against Banxso . For instance, The FSCA had been
investigating Banxso since 2023 and had already received approximately 70 complaints
against Banxso from members of the public and provisionally suspended its operating
license; the Financial Intelligence Centre (FIC) had also done an analysis of Banxso’s
bank accounts and taken certain steps against it; The South African Reserve Bank had
also taken steps against Banxso; the National Director of Public Prosecutions, had
obtained a preservation order in terms of section 39 of the Prevention of Organised
Crime Act, 121 of 1998, against Banxso although it was later set aside. Furthermore, the
suggestion that M&B and some liquidators are behind the liquidation for their own gain
and not for the interest of legitimate creditors or clients, is simply vexatious. The reliance
by Banxso on a newspaper article and interim liquidation and distribution account from
another matter, where B&M was involved , to support its claim , is simply vexatious and
irrelevant. There is no evidence to suggest that M&B was the attorneys of record in the
application for liquidation in that matter or involved in the appointment of the liquidators.
M&B was only appointed in that case after the liquidators were appointed by the Master.
Furthermore, the factual content of the article is being disputed by B&M. In any event ,

Furthermore, the factual content of the article is being disputed by B&M. In any event ,
Banxso’s allegations of collusion and self -serving litigation by M&B and liquidators do
not contribute to the resolution of the real issues.

[17] On the issue of touting . Firstly, on the papers filed , M&B admitted that upon
further investigation into the affairs of Banxso, a website where affected clients of

5 Vaatz v Law Society of Namibia 1991 (3) SA 563 (Nm) at 566 C-E.
6 See Helen Suzman supra.

Banxso can inter alia register their details and provide the amount of money they
invested and lost was created. As at 5 November 2024, it was alleged that a total of 130
investors had registered and a total amount of R133 286 078.49 was lost by them in
dealings with Banxso. Touting is clearly unlawful and a contravention of rule 49.17 for
the Rules of the Attorneys Profession7 and co de of conduct of the Legal Practice
Council. On a proper reading of the relevant rules, I cannot find any contravention of the
Attorneys Profession and or Legal Practice Council’s Rules by B&M. It simply created a
website not to improperly solicit clients but to enquire if there are clients of Ban xso that
had similar experiences like Wentzel . On the data extracted from the webpage, no
promise was made by B&M that it will recover monies upon registration. On the papers
filed B&M did not improperly sought or by unfair means, business from Banxso clients.
The fact that the Banxso clients may or may not become clients of B&M was a matter of
their own choice.

[18] In view of the abovementioned , the allegations to be struck are nothing more
than reckless and offensive generalisations which should find no space in a proper
court process. These assertions or conclusions by Banxso are not robust
engagements but scandalous, vexatious and irrelevant as contemplated in Rule 6(15)
and need to be struck out.

[19] Banxso’s striking out application is mainly premi sed on the communication
between B&M and the FSCA, including the subpoena B&M obtained to get hold of the
interview transcripts between the FSCA and the Ban xso’s employees . Banxso,
alleges the FSCA undertook that the interviews will remain confidential and unlawfully

7 The Rule provides the following: . . . no tout for professional work . A member will be regarded as being
guilty of touting for professional work if he or she either personally or through the a gency of another,

procures or seeks to procure, or solicits for, professional work in an improper or unprofessional manner or
by unfair means, all of which for purposes of this rule will include, but not be limited to: 49.17.1 the
payment of money, or the offering of any financial reward or other inducement of any kind whatsoever,
directly or indirectly, to any person, in return for the referral of professional work; or 49.17.2 directly or
indirectly participating in an arrangement or scheme of operation re sulting in, or calculated to result in, the
member's securing professional work solicited by a third party. For purposes of this rule 49.17
"professional work", in addition to work which may by law or regulation promulgated under any law be
performed only by a practitioner, means such other work as is properly or commonly performed by or
associated with the practice of a practitioner.

disclosed it to M&B to seek its liquidation via the backdoor. Banxso further alleges the
subpoena was invalid and the F SCA was under no obligation to disclose the
information. Banxso also holds the view that the transcripts obtained i s new matter
and Wentzel cannot make out a new case in her replying affidavit.

[20] The FSCA, although a party to the proceedings adopted a neutral stance and
neither oppose d nor supported the application for liquid ation, although it filed a
replying affidavit and denied the assertion that it acted unlawfully or in collusion with
B&M to liquidate Banxso. According to the FSCA it acted within the law when it
provided the relevant material to B&M.

[21] The criticism levelled against the FSC A, is in my view unwarranted. It is well
established in our law that in action or trial proceedings, the Registrar of the court
may issue a subpoena duces tecum as provided for in Rule 38 of the rules of this
court. Rule 38(1)(a)(iii) and (c) of the Uniform Rules make provision for var ious
procedures to procure evidence for a trial. In addition, Rule 38 makes provision for
the manner in which evidence w ould be adduced at a trial. It does not ordinarily deal
with motion proceedings, as Rule 6(5)(g) does not permit a party on his own authority
to cause the Registrar to subpoena a witness to appear at the hearing of the
application. That authority only vests in the Court, which may grant leave for a person
to be subpoenaed.8

[22] In this instance, Wentzel elected to issue a subpoena duces tecum , without
leave of the Court. It is trite that ‘ the rules are not an end in themselves to be
observed for their own sake. They are provided to secure the inexpensive and
expeditious completion of lit igation before the courts and where one or other of the
parties has failed to comply with the requirements of the rules or an order made in
terms thereof and prejudice thereby being caused to the opponent, it should be the

terms thereof and prejudice thereby being caused to the opponent, it should be the
court’s endeavour to remedy such prejudice in a manner appropriate to the

8 Campbell and another v Kwapa and another 2002 (6) SA 379. See also Steyn v Meyer (59537/2021)
[2022] ZAGPPHC (13 October 2022); SP v SB (2025/05447) [2025] ZAWCHC 253 (19 June 2025).

circumstances, always bearing in mind the objects for which the rules were
designed.’9

[23] In these circumstances, the mere issuing of the subpoena by the Registrar ,
without leave of the court, does not automatically invalidate it. It remains a binding
legal instrument to be complied with until properly set aside by a court.10 The FSCA
was therefore not acting in cahoots with M&B . It was under a legal obligation to
comply with the subpoena. Moreover, the FSCA is not a witness but a party to the
proceedings and also subject to rule 35(11) which provides that:

‘The court may, during the course of any proceeding, order the production by
any party thereto under oath of such documents or tape recordings in such
party’s power or control relating to any matter in question in such proceeding
as the court may deem appr opriate, and the court may deal with such
documents or tape recordings, when produced, as it deems appropriate.’
As liquidation matters are ordinarily urgent, the furnishing of the documents by
the FSCA to M&B made imminently sense as it was an expeditious and
inexpensive way to bring the matter to finality then risking an unnecessary
interlocutory application and wasting of scarce judicial resources.

[24] On the issue of prejudice , Banxso’s main argument was the evidence was
unlawfully obtained. In my view there is no merit in any of this. Firstly, the ev idence
was not unlawfully obtained , and secondly, Banxso made extensive use in its
supplementary answering affidavit to deal with the evidence. In fact, i t also relied on
part of the documents in support of its own case.

[25] Turning to the issue of the new evidence in reply. The approach adopted by
our Higher Courts to admit further evidence in reply has been settled by the Supreme
Court of appeal in Drift Supersand (Pty) Ltd v Mogale City Local Municipality and

9 Federated Trust Ltd v Botha 1978 (3) AD at 654 C.
10 Oudekraal Estate (Pty) Ltd v Ciy of Cape Town 2004 (6) SA 222 (SCA).

another11 wherein it held that:

‘As this Court recently stated in Lagoon Beach 12, not only must a court
exercise practical, common sense in regard to striking out applications but
there is today a tendency to permit greater flexibility than may previously have
been the case to admit further evidence in reply. Consequently, as stated
in Nkengana13,‘if the new matter in the replying affidavit is in answer to a
defence raised by the respondent and is not such that it should have been
included in the founding affidavit in order to set out a cause of action, the court
will refuse an application to strike out’.

[26] Applying the abovement ioned approach, the new evidence does no t amount
to creating or making out a fresh cause of action in reply. It mainly deals to disprove
Banxso’s defence and to support the allegations made out in Wentzel’s founding
affidavit. It follows that there is no reason either to strike out the explanation made in
reply or to ignore it.

[27] For all the abo vementioned reasons it follows Banxso’s application to strike
out cannot succeed.

Provisional winding-up

[28] It is trite that in an opposed application for provisional liquidation, an applicant
must establish its entitlement to an order on a prima facie basis, meaning that the
applicant must show that the balance of probabilities on the affidavits is in its favour.14
This would include the existence of an applicant’s claim where such is disputed. Even
if the applicant establishes its claim on a prima facie basis, a court will ordinarily
refuse the application if the claim is bona fide disputed on reasonable grounds. The

11 [2017] 4 All SA 624 (SCA) at para 10.
12 Lagoon Beach Hotel (Pty) Ltd v Lehane NO and another 2016 (3) SA 143 (SCA) at para 16.
13 Nkengana and another v Schnetler and another [2011] 1 All SA 272 (SCA) at para 10.
14 (Kalil v Decotex (Pty) Ltd 1988 (1) SA 932 (A) at 975J-979(F).

rule that winding -up proceedings should not be resorted to as a me ans of enforcing
payment of a debt the existence which is bona fide disputed on reasonable grounds ,
is part of the broader principle that the court’s processes should not be abused. In the
context of liquidation proceedings, the rule is generally known as
the Badenhorst rule15.

[29] A distinction is ordinarily drawn between factual disputes relating to the
respondent’s liability to the applicant and disputes relating to the other requirements
for liquidation. At the provisional stage, the other requirements must be satisfied on a
balance of probabilities with r eference to the affidavits. In relation to the applicant’s
claim, however, the court must consider not only where the balance of probabilities
lies on the papers but also whether the claim is bona fide disputed on reasonable
grounds; a court may reach this conclusion even though on a balance of probabilities
the applicant’s claim has been made out .16 However, where the applicant at the
provisional stage shows that the debt prima facie exists, the onus is on the company
to show that it is bona fide disputed on reasonable grounds.17

[30] At the heart of this winding -up application is the claim that Banxso is a
criminal enterprise, designed to defraud members of the public. In support of its claim,
Wentzel relies heavily on the affidavits filed by the following: the investigation by the
FSCA to provisionally suspended Banxso’s operating license; the analysis of
Banxso’s bank accounts by Financial Intelligence Centre (FIC) and the steps taken
against it; The steps the South African Reserve Bank had taken against Banxso 18,
including the affidavits fi led in the National Director of Public Prosecutions,
preservation order against Banxso although , as stated previously , it was later set
aside.


15 Badenhorst v Northern Construction Enterprises (Pty) Ltd 1956 (2) SA 346 (T) at 347H-348C.

15 Badenhorst v Northern Construction Enterprises (Pty) Ltd 1956 (2) SA 346 (T) at 347H-348C.
16 Payslip Investment Holdings CC v Y2K Tec Ltd 2001 (4) SA 781 (C) at 783G-I.
17 Hülse-Reutter & Another v HEG Consulting Enterprises (Pty) Ltd 1998 (2) SA 208 (C) at 218D-219C.
18 The South African Reserve Bank instructed Capitec to block certain funds held in one of Banxso’s
Standard Bank accounts, due to the transaction being of a suspicious nature. The suspicious transaction
was a transfer of R322 446.00 to a Cyprus registered entity XF Solutions Ltd which is earned by Mr.
Sekler, being a director of Banxso.

[31] Apart from the allegation that the winding-up application is an abuse of
process, Banxso believes that the security tendered for the applicant and intervening
parties is a demonstration of its commercial solvency; the claim s of Wentzel and
intervening parties have been reasonably disputed , including the enrichment claim
under the condictio ob turpem.

[32] The central question is whether the applicant on a balance of probabilities has
established the transactions with Banxso were null and void and has a claim for those
funds under the condictio ob turpem.

[33] The requirements premised on the enrichment claim under the condictio ob
turpem are the following:19 (i) a transfer of money between plaintiff and defendant , ie
ownership must have passed with the transfer; (ii) an illegal and prohibited contract;
and (iii), the defendant’s unjustified enrichment.

[34] Wentzel’s complaint can summarised as follow s: she at the time of investing
was a 60 year old pensioner who retired in 2015 after a career of 30 years in the retail
environment. The funds that she entrusted to Banxso formed a substantial portion of
her life savings and her provision for retirement. Before the investment with Banxso
she became incr easingly concerned that the provision made for her retirement was
insufficient, considering the escalation of living costs in recent years. During or about
early July 2024, she came across an online advertisement, which included a videoclip
purportedly of a television interview between an SABC presenter and Elon Musk,
discussing an amazing investment opportunity through an entity called ‘ Immediate
Matrix’. The interview inter alia advised that, by investing an amount of R4 700, one
could, within a week, receive R34 300.00. She clicked on the registration option on the
advertisement and completed an online registration form by providing her name and
contact details. Almost instantly, she received a telephone call from a lady who

contact details. Almost instantly, she received a telephone call from a lady who
identified herself as Akona, working for Banxso. Subsequently, another Banxso agent,
called the applicant where the following exchange transpired:

19 See National Credit Regulator v Opperman 2013 (2) SA 1 CC, para 15.

‘(The applicant)“is this the ad which Elon Musk or – and all that ads? It is on
Facebook. The Agent: Ja, ja, that was the ad that you saw, right. The applicant:
Okay’. The Agent ‘Ja, ja, that was the ad that you saw, right, so I am calling
you so that we can help you to download the app. The app is the one that
you are going to use to keep check of how much profit you make on the
investment. And then I will also show you how you can withdraw your profits
once you have them …’

[35] The agent informed the applicant that she could make an initial deposit of
R1 800 and that she could make a profit of about R800 or R900 per week depending
on the market. On or about 13 July 2024, the applicant received a telephone call from
another agent at Banxso. He provided her with the banking details of Banxso, a
Standard Bank account, into which she paid a sum of R1800.00. He also advised her
that a ‘ success manager’ was allocated to her and would in future be her contact
person at Banxso. She was further advised th e success manager would explain to
her how she should login to her Banxso online platform account and what trades she
should execute . On 29 July 2024, the success manager contacted her for the first
time and informed her that she had already made a profit of approximately R900.

[ 36] According to Wentzel , she had absolutely no idea how any of the available
transactions worked and was completely reliant on advice. She states the success
manager was aware of it. A transcript of the following telephonic exchange between
them on 3 September 2024, reflects the following:

‘The applicant “you must remember I don't understand anything about the
markets and about these things and you are taking me by the hand and I am
very grateful about that, do you know what I am trying to say?”
Success Manager: “Yes I know.”’

[37] On 19 August 2024, she informed the success manager due to the success on

her initial investment, she wished to make a further deposit of R30 000.00. Numerous
telephone and WhatsApp conversations occurred between them. According to
Wentzel, the success manager started to place increasing pressure on her to urgently
deposit R30 000 as the market was doing well and if she did not make the deposit
within a few days, she would not receive as good a return as before. He furnished her
with Banxso's Capitec Bank details and on 25 August 2024 she deposited R10 000.
On 27 August 2024 she deposited a further sum of R20 000 into that account. She
made a further profit in the amount of R5 000.

[38] Subsequently, Wentzel received numerous phone calls from the success
manager who increasingly insisted that she make further investments with Banxso.
She was also referred to the Banxso ’s referral scheme . According to the Banxso
website a referral bonus is earned according to the number of persons referred as
follows:

(a)One to five persons – 15% of the initial amount deposited.
(b) Six to ten persons – 20% of the initial amount deposited.
(c) Ten or more persons – 30% of the initial amount deposited.

[39] According to Wentzel, the success manager became increasingly insistent,
and under the promise of enormous returns on her investment, she deposited a
further amount of R470 000 into Banxso's Nedbank account on 6 September 2024.
After the deposit of R470 000, the applicant saw the following day on the online
Banxso platform that she had made a profit of R200 000. According to the Banxso
platform she was continuously making profits on trades, and she felt assured that her
investment was in good hands.

[40] On or about 24 September 2024, the applicant opened her Banxso online
trading platform and noticed that the so-called margin levels were becoming quite low.
She directed enquiries to the success manager with a requested to withdraw her
funds from Banxso. She was informed by him not to withdraw her capital. Moments

later he contacted her telephonically and informed her that his manager had
proposed giving her a recovery bonus of R45 000 to fix the margin levels. He further
advised that, before the recovery bonus could be processed, she needed to complete
a form which was e -mailed to her. On 24 September 2024 she returned the
completed form via WhatsApp as she was unable to send it via e-mail due to network
issues at the time. The success manager advised her to leave the form for now and
the account as is, until the next day. Later that evening, she received alert
notifications from the Banxso app on her cell phone. She immediately logged into her
Banxso account and saw that her entire capital investment had been wiped out in
apparent trading losses.

[ 41] The next day, 25 September 2024, she was informed the reason for the losses
was that she did not send the aforesaid form to them via e -mail and that Banxso did
not accept the form via WhatsApp. The R45 000 recovery bonus could therefore not
timeously fix the margin levels, which resulted in the loss of all her money.

[42] On 26 September 2024, Wentzel received a call from the success manager,
who informed her that he had spoken with his manager and that they would be able to
make up for her losses with further trading, should she deposit a further R500 000.
She attempted to access her online trading platform but was unable to do so. It
appeared that access to her account was blocked. After further calls to Banxso, she was
only met with a response to invest further funds to make up the loss of her monies. She
ultimately decided on 23 October 2024 to consult with her attorneys of record.

[43] So, what is Banxso’s Business model? According to Banxso it operates as a
‘Straight Through Processor ’. This means it operates between the client and the
liquidity provider. As Banxso explains:

’A client uses the Banxso platform. Banxso, prior to 16 October 2024, was a

’A client uses the Banxso platform. Banxso, prior to 16 October 2024, was a
licensed Category 1 Financial Services Provider (FSP). On that platform, the
client enters into a Contract for D ifference (CFD) with these off -shore LPs. A

CFD is, in essence, a speculative trading position as to the fluctuation in price
of a particular commodity (currency, shares or indices). If the client's position is
that the price will go up, and it does, they win and make a profit. Conversely, if
the client bets that the price will go down, and it goes up, the client loses and
occasions a trading loss. These CFDs are intermediated by Banxso and
placed with the offshore LPs, who acts as the counterparty, princip al and
market maker to the trading. As such, the LP is responsible for the profit and
loss reconciliation. Accordingly, if the client wins, the LP pays Banxso, and
Banxso credits the client's account accordingly. If the client loses, Banxso pays
the client's money to the LP.’

[44] Banxso’s General Terms and Conditions, attached to the founding papers,
recorded the following:

’You can enter a leveraged CFD transaction with us by placing an order on the
Trading Platform (the "Order"). The Order shall state your "position" - "buy" (long)
or "sell" (short), the size of the Transaction, the leverage rate, and the Rate (as
defined below). . . .The Client deposits funds with the Company and places an
order via a trading platform, which is managed by the Company and the
Company is responsible for safeguarding of the clients' funds. Upon receipt of the
order, it is immediately opened by the third party through the company's trading
platform. In this respect, the Company executes the client order by acting as a
broker (STP broker)’.

[45] According to Banxso, it acts like an agent and the enrichment which derives from
Wentzel’s and the other claimant’s loss, if any, is not with them but lies with LP. Banxso
further explained that if there are any shortcomings in its business model, it will be
working hard with the FSCA, to regulate its business.

[46] In practice Banxso alleges it employs the use of a Metaquotes MT 4/5 trading
platform. This platform is apparently an industry-standard software, ensuring that live

pricing feeds (drawn from market data) are reflected in respect of the commodities
offered by the company. Neither Banxso nor the liquidity provider determines trading
margins between buy and sell arbitrarily but instead these are predetermined being
subject to live trading data as influenced by market conditions.

[47] A client will enter into a CFD with an offshore LP. The CFDs are thus
intermediated by Banxso and placed with offshore LPs who act as the counterparty,
principal and market maker to the trading. As such, the LP is responsible for the profit
and loss reconciliation. Accordingly, if the client wins, the liquidity provider pays Banxso
and Banxso credits the client’s account accordingly. If the client loses, Banxso pays the
client’s money to the liquidity provider. In its further answering affidavit Banxso
explained that it is ‘an intermediary, and the liquidity provider is the market maker. As
such, while the liquidity is provided by the liquidity provider, it is Banxso who has an
agreement with the client.’

[48] According to Banxso it employed the services of three different LPs from time
to time depending on whichever provided the best pricing and most effective trading
to clients. The LPs are the following:

(a) Flamingo Clearing House Limited (FCH), registered in the Comores;
(b) Flamingo Capital Services LLC (FCS), registered in Saint Vincent and the
Grenadines;
(c) Eclat Technologies Limited (Eclat), registered in Mauritius.
In its answering affidavit, Banxso provided a schedule of alleged payments to
Flamingo Clearing House via FiveWest OTC Desk Pty (Ltd) and Blockko in.
Banxso’s attorneys explained it as follows:
‘Following periodical reconciliation of client profits and losses, the company remits
funds to its offshore LP (FCH) at its instruction and direction and moreover, to its
nominated account. In doing so, funds are deposited with Fivewest - in ZAR and
by EFT to Fivewest's nominated bank account (the local account confirmations

by EFT to Fivewest's nominated bank account (the local account confirmations
being herewith enclosed, marked as annexure "A6") - where the LP holds an

account. As such, Fivewest accepts these funds on behalf of the LP and, in turn,
remits them abroad through its global payment service and treasury management
offering (please see: https://www.fivewest.co.za/international-payments).
For purposes of the aforesaid, both Banxso and the LP have separate accounts
with Fivewest, in order to streamline the remittance of t hese funds. Notably,
Banxso does not have any specific service level agreement with Fivewest (nor
Blockkoin) for the aforesaid functionality and instead is subject to Fivewest's
standard terms and conditions. Accordingly , it Fivewest's services much like a ny
other corporate client. In respect of the remittance of funds, the LP then issues
Banxso with receipts, which is kept for record and accounting purposes.’

[49] In clarification, Banxso recorded that it transfers money into an account named
“FiveWest OTC Desk (Pty) Ltd and Blockkoin (Pty) Ltd who in turn transfer the fiat
money (into cryptocurrency) to Banxso’s liquidity provider , as it does not have an
account in its own name with FiveWest.

[50] In Banxso’s standard terms and conditions Banxso’s clients are informed that:
‘”Liquidity provider ” means ”a third-party company that underwrites or provides the
financing for transactions and makes a market for a given asset”. ”The Liquidity Provider
is the sole Execution Venue for the execution of Client Orders. The Company acts as an
agent on the Client's beh alf, and the sole Execution Venue for the execution of Client
Orders is the Liquidity Provider”.’

The FSCA

[51] The FSCA investigation established that the sole shareholder of Banxso, is
Mr. Sekler, an Israeli based attorney. He is also the shareholder and beneficial owner
of the three LPs allegedly used by Banxso.

[52] The investigation by the FSCA also established that Eclat was not allowed to
provide LP services to third parties and that Banxso did not place any of its clients’

business with them. In respect of FCS, it was established that it is a limited liability
company and does not regulate LPs. Moreover, the FSCA uncovered the FCS’s
business description bears no relevance to the activities of LPs as it was a business
advisory and solutions firm. With reference to FCH, it was established that only two
payments of R 100 000 each were made during April 2024 to FCH, whilst during the
period January 2 022 to April 2024 more than R 880 million was received by Banxso
from clients. According to the FSCA, the flow of monies is not consistent with FCH
being a LP during the relevant period.

[53] The FSC ultimately expressed a view that that Banxso has mate rially
contravened numerous financial sector laws and it will be in best interest of the clients
that the funds be transferred to the control of an independent person pending the
outcome of a final decision. Banxso was not oppose to utilizing a local LP, to appease
the FSCA.

[54] The FSCA has in detail set out the reasons why it decided to provisional
withdrew Banxo’s FSP license. The allegations underpinning the complaints by
Banxso’s clients were the following:

(a) The complainants saw various advertisements that were circulating on
social media, including a news article which purported to be from the South
African Broadcasting Corporation (SABC) relating to an investment platform
known as Immediate Matrix. The news article stated th at Tesla/Elon Musk
launched a new platform, called Immediate Matrix, (IM) which was an
automated trading platform aimed at helping families become wealthier;
(b) The news article and advertisements (videos) referred to a minimum
investment deposit of R4 700, with a pr omised return of R34 300 within a
week. This equated to a return of approximately 730% in one week:
(c) the IM webpage reflected that prospective investors would be contacted but
it did not explain who would be contacting the prospective investors. However,

it did not explain who would be contacting the prospective investors. However,
after the prospective investors submitted their details, within minutes; they

were contacted by one of Banxs o’s agents through SMS, email or telephone
call;
(d) in addition to the promotional videos and news articles with a link,
Immediate Matrix also had a website. On I M’s website, prospective investors
were requested to submit their personal details. However, the process differed
slightly on the website compared to the advertisements, in that on the website,
once the details were captured and the ’submit’ button clicked, the website
redirected the prospective investors to a ‘thank you’ webpage. On the ‘thank
you’ webpage, another button called ’continue to account ’ popped up. After
clicking the ‘continue to account’ button, it redirected the prospective investors
to Banxso’s website, with another pop -up to make a deposit into the newly
created account with Banxso;
(e) the Banxso agents assisted them with opening trading accounts and
solicited the initial deposit from the prospective client as advertised by IM. After
making the deposits, the agents directed the investors to enter specific trades
derivatives, which ultimately led to massive trading losses;
(f) the consultants used aggressive and high -pressure sales techniques to
convince investors to invest additional funds;
(g) the complainants were lured by the deepfake videos featuring celebrities /
prominent persons and which promised high returns;
(h) they also alleged that once they invested with Banxso, Banxso failed to
process their withdrawal requests timeously and did not disclose material
information such as swap fees and the risks associated with trading.

[55] The FSCA, ultimately recorded that having regard to the complaints, and its
own investigation, including an analyses of Banxso’s bank accounts, it established
that: The deepfake advertisements appeared to have been created by I M, a fictitious
entity with no real corporate persona ; the identities of the celebrities and prominent
persons featured in the deepfake videos were fraudulently used; The videos and

persons featured in the deepfake videos were fraudulently used; The videos and
news articles c ontained electronic links that led to an I M webpage, through which
prospective investors could provide their personal details, as well as their contact

details; when the prospective clients clicked on the link on the deepfake
advertisements, they were redi rected to Banxso’s website . The c lients’ funds were
then transferred into Banxso’s bank account . The products offered by Banxso were
similar to the ones on the deepfake advertisement. The client deposits into the
various Banxso bank accounts were consistent with the investment opportunities
advertised through the deepfake advertisements; the IM webpage reflected that
prospective investors who submitted their personal information would receive a call
from a person who would assist the prospective in vestors in setting up their trading
accounts in derivatives. The prospective investors were contacted by Banxso agents
who fulfilled the commitments made by I M in the deepfake advertisements ; Banxso
agents contacted clients and confirmed that they were cal ling because the
prospective clients showed interest in the I M product or in connection with the
advertisements which featured the prominent persons; the deposits into Banxso’s
bank accounts increased significantly when the deepfake advertisements gained
prominence; and a high number of clients confirmed that they invested with Banxso
because of the deepfake advertisements.

[56] Banxo denied any association with the IM scheme and disputes the FSCA’s
findings. According to Banxso it did not act fraudulently or unlawfully and intends to
traverse the FSCA’s findings in the appropriate forums. It admitted that its website
called for an industry standard deposit of roughly 250 US dollars, translating to
approximately R 4 700 (at the time) and is a figure which IM also used in their
marketing material.

[57] Banxso explains that IM has no affiliation to them and have operated
parasitically on its platform causing it great prejudice. According to Banxso, it found
that many complaints were not genuine IM scheme related but rather disgruntled
clients who might have experienced some loss or other issue on the Banxso platform .

clients who might have experienced some loss or other issue on the Banxso platform .
The original number was accordingly whittled down from over a hundred to seventy
complaints. Banxso recorded it since has paid out R67 574 002.47 worth of refunds
of which R14 million was identified as being IM scheme related.

[58] The FSCA, investigated five different bank accounts utilized by Banxso during
the relevant period. There were three different accounts a t Standard Bank. One at
Nedbank and one at Capitec. The FSCA commented as follows:

Standard Bank account no. xxxxxx592

[59] It is a separate account designated for client funds ; clients who took up
products through Banxso, should have deposited their funds into this account. These
funds were supposed to be remitted to a product provider, in this case the issuers of
Contracts for Difference, which the clients believed were their investment products.
During the period from January 2022 to April 2024, approximately R945 million was
deposited into this account. This amount comprised clients’ deposits of approximately
R736 million. Transfers of approximately R99 million from Banxso Standard Bank
account number xxxxxx000; and approximately R110 million transfers from Banxso
Standard Bank account number xxxxxxx001. During the abovementioned period,
payments including cash withdrawals of approxi mately R912 million were made from
this account. The most notable payments and transfers were the following:
approximately R94 million which appeared to be paid to clients; approximately R608
million transferred to Banxso Standard Bank account number xxxxxx000;
approximately R162 million transferred to Banxso Standard Bank account number
xxxxxx001; approximately R4 million paid to FiveWest (Pty)Ltd (Five West), an
authorized crypto asset service provider. According to Banxso, they deposited funds
to FiveWest’ s bank account because it is where the liquidity provider holds an
account. Banxso claimed that FiveWest accepts the funds on behalf of the liquidity
provider and remits them abroad to the liquidity provider through their (FiveWest)
payment system . The a nalysis of this bank account showed an amount of
approximately R43 million worth of personal/business payments. The
personal/Business payments were made at, inter alia, Vodacom, Woolworths, Pick ʼn

personal/Business payments were made at, inter alia, Vodacom, Woolworths, Pick ʼn
Pay, Bay Hotel and the Bar Keeper. From the analysis of th ese accounts, it appears
that a significant number of clients’ funds were used for personal and or business -

related expenses.

Standard Bank Account Number xxxxxx5083

[60] During the period from January 2022 to April 2024, approximately R941
million was deposited into this account . This amount comprised of approximately
R608 million transfers from Standard Bank account number xxxxxx592;
approximately R293.5 million credit card transactions; approximately R17 million from
various entities; approximately R16 million transfers from Banxso Standard Bank
account number xxxxxxx001; R 6 million was direct deposits from clients.

[61] The FSCA commented that the account was not a separate account
designated to receive clients’ funds although the bulk of the monies (R608 million) in
the account were transferred from such an account of Banxso. The FSCA recorded
that during the abovementioned period, payments, cash withdrawals and transfers of
approximately R933 million were made from this account. The most notable
payments and transfers were the following: approximately R581 million paid to
FiveWest; approximately R99 million transferred to Banxso Standard Bank account
number xxxxxx592; approximately R52.5 million was paid to what appeared to be
clients; approximately R1.5 million was transferred to other Banxso bank accounts;
approximately R162 million was paid to vari ous entities such as Sars and service
providers like Toshiba, Pointline and Red House ; approximately R5.3 million worth of
credit card transaction; approximately R5 million were personal and or business
transactions; approximately R3.75 million was paid to the General Manager of
Banxso, who filed the answering papers on its behalf ; and approximately R100 000
was paid to Flamingo Clearing House.

[62] The FSCA holds the view that upon the analysis of this account, some client
funds were used for personal and or business-related payments.

Standard Bank Account Number xxxxxxx001

[63] During the period from June 2023 to March 2024, approximately R156 million
was deposited into this account. This amount comprised of approximately R149
million transfe rs from Banxso Standard Bank account number xxxxxx592 and
approximately R5.5 million transfers from Banxso Standard Bank account number
xxxxxx083. Most of the funds in this account were clients’ funds. According to the
FSCA records, this account was not a separate account designated for client funds.

[64] During the abovementioned period, transfers of approximately R126 million
were made from this account. The transfers comprised of approximately R110 million
to Banxso Standard Bank account number xxxxxx592 and approximately R16 million
transferred to Banxso Standard Bank account number xxxxxx083.

Nedbank Account Number xxxxxxx486

[65] During the period from April 2022 to April 2024, approximately R137 million
was deposited into this account. Approximately R136 million of the above total
appeared to be direct deposits from clients. According to the FSCA’s records, this
account was not a separate account designated for client funds.
During the abovementio ned period, payments of approximately R62 million were
made from this account. The most notable payments were the following:
approximately R23.6 million paid to Fivewest; approximately R18 million transferred
to Banxso Standard Bank account number xxxxxx592; approximately R5.5 million
paid to Blockkoin (Pty)Ltd , also a crypto asset service provider) ; approximately R6.6
million was paid to what appeared to be clients funds; and approximately R100 000
was paid to Flamingo Clearing House.

Capitec Account Number xxxxxxx004

[66] During the period from April 2024 to September 2024, approximately R12
million was deposited into Banxso Capitec account number xxxxxxx004.

Approximately R11 million of the above total appeared to be direct deposits f rom
clients and the balance of approximately R1 million appeared to be transfers from
other Banxso bank accounts. According to the FSCA records, this account was not a
separate account designated for clients’ funds. It needs to be mentioned that Banxso
did not deny the South African Reserve Bank instructed Capitec to block certain funds
held in one of Banxso’s accounts, due to the transaction being of a suspicious nature.
The suspicious transaction was a transfer of R 1, 322, 446.00 to a Cyprus registered
entity XF Solutions Ltd which is owned by Mr. Sekler, a director of Banxso. According
to the FSCA, payments of approximately R169 000 were made from this account
during the above-mentioned period, and the payments appeared to be made to
clients.

[67] From the above analysis of Banxso’s bank accounts, the FSCA concluded
that: not all clients’ funds were invested ; funds were co -mingled with business funds
and client funds were not easily and or readily discernible. Moreover, Banxso
transferred clients’ f unds to other Banxso bank accounts which were not designated
accounts to hold such funds and clients’ funds were misappropriated and used for
personal and business expenses. Furthermore, no significant payments were made
to product providers or liquidity p roviders who were supposedly the issuers of the
CFDs.

[68] The FSCA further recorded that although approximately R615 million was
paid to FiveWest and Blockkoin, direct payments made to liquidity providers were
minimal. The FSCA, also stated that according to Fivewest and Blockkoin, they did
not make payments to the liquidity providers . What Banxso did was to deposit and or
transferred fiat currency to them with the intention to purchase crypto assets (USDT).
The USDT was then transferred on the Blockchain to Banxso’s crypto wallets.

[69] According to FSCA, several of the General Code of Conduct for Authorised

[69] According to FSCA, several of the General Code of Conduct for Authorised
Financial Services Providers and Representatives were contravened by Banxso,
including sections of the Financial Institutions (Protection of Funds) Act 28 of 2001, in

that Banxso, a financial institution, failed to exercise proper care and diligence when
handling trust property held in the separate account designated to hold clients’ funds;
section 8A(a) of the FAIS Act20 and section 139(5) of the FSR Act21.

[70] In the supplementary founding papers, it was further recorded that a total of
130 of Banxso’s investors registered on the online portal w[...] as at 5 November
2024. According to th e webpage a total amount of R 133 , 386, 078,49 was invested
and loss through dealings with Banxso; numerous clients of Banxso were provided
with an ABSA account purportedly in the name of (AS BANXSO) with and account
number; it was later established the actual account holder of the account is in fact a
company called Ahead Start (Pty) Ltd (Ahead Start) ; Banxso also utilized an FNB
account which clients were led to believe was in the name of AS Banxso (Pty) Ltd; it
was however established the actual account holder is a company called Valor Vault
(Pty) Ltd (Valor Vault).

[71] Banxso denied the clients funds were comingled and recorded in its papers
the following bank accounts containing client funds:

(a) Standard bank account xxxx592 (containing R8 069 138.20);
(b) Standard bank account xxxx001 (containing R25 221 694.69);
(c) Nedbank account xxxx486 (containing R23 363 196.45); and
(d) Capitec account xxxx004 (containing R12 718 266.77).

[72] The following bank accounts were recorded holding operational funds:


20 Banxso no longer complies with the fit and proper requirements relating to honesty and integrity in that
Banxso misled and provided false information to clients regarding inter alia; its association with
Immediate Matrix, the contents of the deepfake videos, the unrealistic returns promised to investors, the
use of the clients’ funds which ended up misappropriated.
21 by providing the investigators with false and/or misleading information which Banxso knew was false

and/or misleading. Banxso informed investigators that the company was neither associated with
Immediate Matrix not the deepfake videos. In fact, Banxso claimed it was a victim of a scam or cyber -
attack by Immediate Matrix, when in fact, they (Banxso) were the main beneficiary of the Immediate
Matrix marketing campaign. As already discussed, Banxso’s denials were false.

(a) Standard bank accounts xxxx083 (containing R23 047 183.54);
(b) Capitec account xxxx008 (containing R88 732.00); and
(c) Capitec account xxxx545 (containing R9 992.66).

[73] Banxso does not dispute it made use of call agents. It apparently employed
internal call agents for some time, however in April 2024 the entire department was
retrenched. According to Banxso, it has since been making use of outsourced call
agents and the m ajority of these outsourced call agents are complying with its
policies, not providing financial advice, and not employing high -pressure sales
techniques.

[74] Banxso also alluded to its marketing strategies that apparently are accurate,
provide reliable information, and referred inter alia, to Google, Facebook, News2 4
and Moneyweb, including the sponsoring of a famous South African MMA fighter, and
the national football team, in support of its claim.

Legality of the Business

[75] Banxso’s business is dependent upon the participation of a legitimate LP. It is
therefore important to look at Banxso’s business operation as a whole , considering
the statutory framework in which it must operate. Looking past the veneer, the
legality of Banxso’s business model and the claim it operates as a Straight Through
Processor is highly questionable.

[76] Although Banxso denies there was an intention to benefit off the IM scheme ,
and only 70 complaints related thereto, the evidence shows differently. The evidence
overwhelmingly demonstrates that deposits into Banxso’s bank accounts increased
significantly when the deepfake advertisements gained prominence . Numerous
clients confirmed that they invested with Banxso because of the deepfake
advertisements. Banxso’s claim is also inconsistent with the statement of a key
individual and internal compliance officer at Banxso at the time. According to his

testimony before the FSCA, clients that came from IM was difficult to track because
they came through a normal onboarding process.22 But more importantly, irrespective
of who was behind the IM scheme there can be no bona fide dispute that Banxso
have benefited enormously through the onboarding of clients who were lured to its
platform via the IM scheme . Furthermore, the service agents of Banxso did not
correct a new client when it was clear that the client was lured through the IM scheme
but continued to onboard clients until October 2024 when the license was
provisionally withdrawn, notwithstanding becoming aware of the IM scheme as long
ago as December 2023. It follows, Banxso paid mere lip service to prevent its agents
from onboarding clients lured through the IM scheme. The undertaking by B anxso to
have better oversite over these agents is unlkely as most are working at outsourced
call centers stationed in foreign countries. It is also difficult to understand how Banxso
will be able to have proper oversight control and disciplinary over agents if most are
working at outsourced call-centers stationed in different foreign countries.

[77] The contention b y Wentzel that she was lured by the dee pfake IM scheme
can therefore not be discarded as highly improbable. T here is also no ob jective
evidence that she otherwise willingly connected through an internal Slava funnel to
sign up , as suggested by Banxso . On the papers filed, t here is no reference of a n
internal Slava funnel at Banxso. It follows, Wentzel’s version is plausable.

[78] The claim by Banxso that it settled and refunded clients also came under the
spotlight. The evidence of Banxo’s clients does not fully support its claim. According
to some of Banxso’s clients once an internal complaint has been lodged, normally
after the loss of their initial investment , the success manager will furnish the client
with a bonus application, which in essence provides the client with a trading credit .

with a bonus application, which in essence provides the client with a trading credit .
The main complaint by the clients was that the credit only allows further trading and if
a withdrawal is allowed it will be a relatively small amount. The clients’ complaint is
supported by Banxso’ bank accounts. Small amounts were paid to them whereas vast

22 The recording reads as follows: “When you come to land on our website and you sign up, we do not
know where you come from. We know you just came to our website”.

amounts were deposited into Banxso’s bank accounts.

[79] The denial by Banxso that there were no co -mingling of funds or funds used
for personal and or business -related expenses , is also not supported by objective
facts. Banxso failed to deal properly with the allegations that certain of its accounts
were separate and designated to receive clients’ funds. Vast amounts of clients’ funds
were transferred to interrelated bank accounts of Banxso. A disturbing feature in all of
this is the relative small amount of monies paid to investors in relation to their initial
investment, whilst hundreds of millions of rands flowed through Banxso’s bank
accounts to be converted into cryptocurrency.

[80] The explanation provided by Banxso that it would transfer money into an
account named ’FiveWest and Blockkoin’” who in turn transfer the fiat money (into
cryptocurrency) to Banxso’s liquidity provider, does not accord with the evidence
established by the FSCA. According to the FSCA, FiveWest and Blockkoin denied
making payments to LPs. According to FiveWest and Blockkoin, what Banxso did was
to deposit and or transferred fiat currency to them with the intention to purchase
crypto assets (USDT). The USDT was then transferred on the Blockchain to Banxso’s
crypto wallets. The latter is in stark contrast to what Banxso said that: ‘all trades are
conducted with an off -shore liquidity provider who acts as the counterparty and
market maker in respect thereof’.

[81] There is also no evidence to support the extent to which the LP performed as
market maker or how and when the LP provide d liquidity to Banxso’s clients to trade .
The alleged proof of payments to FCH as an LP via FiveWest and Blockkoin are
equally unsatisfactory. There is no explanation who prepared the documents , the
source of the information and the wallets into which the USDT cryptocurrency was
deposited. There is also great uncertainty whether investors were properly
underwritten by an LP.

underwritten by an LP.

[82] Another area of concern is the extent to which Banxso received payments for

its alleged intermediary services. There is no indication on the papers filed that an LP
paid Banxso for such services rendered. In fact, the General Terms and Conditions of
Banxso23 shows the rate displayed on the website is determined by it and includes a
certain margin between the buy and sell rate which ultimately constitutes the profit
Banxso makes from each transaction. The latter is different to Banxso’s version, that
neither it nor the liquidity provider determines trading margins between buy and sell
arbitrarily but are predetermined by live trading data as influenced by market
conditions. The latter cannot be correct because in order for Banxso to make a profit
the trading rates needed to be manipulated. Banxso’s evidence that it only functions
as an intermediary and does not derive a right to the monies in its bank accounts is
therefore unlikely. It is obvious Banxso benefits directly when an investment took
place whether the client suffer a loss or not.

[83] Banxso’s other functions of inter alia , retaining investors funds to do
reconciliation before paying the liquidity provider, paying trading and referral bonuses
to clients, providing negative balance protection and replenishes clients’ accounts to
zero to avoid them having to pay the full value for their losses , do not s upport the
contention of a ‘Straight Through Processor’ in the true sense of the word.

[84] On a conspectus of all the evidence , Wentzel and the Intervening Parties
complaint that Banxso’s business model is illegal and does not operate within the
confines of the law, is not without merit. Prima facie i t has been established that
prospective investors were contacted by Banxso agents who fulfilled the
commitments made by I M in the deepfake advertisements; Ba nxso agents contacted
clients and confirmed that they were calling because the prospective clients showed
interest in the IM product or in connection with the advertisements which featured the

interest in the IM product or in connection with the advertisements which featured the

23 The General Terms and Condition; reads as follow at 5.11 - 5.14’5.11. By placing an order, you
represent that you have fully understood: 5.12. the risks involved in the transaction (including but not
limited to those detailed in our Risk Disclosure Policy);5.13. that by entering a Transaction you are not
gaining any access or right to the Underlying Assets; and 5.14 . that all transactions are entered into
and closed in accordance with the rate as display ed on the Website (the “Rate”), which we determine
at our sole discretion. You acknowledge and agree that such right does not reflect any ‘market price’ or
rates quoted by any third party. The Rate is determined by us in such a way as to include a certain
margin between the “Buy” and “Sale” Rates which constitutes our profit from each Transaction.”

prominent persons; a high number of clients confirmed that they invested with Banxso
because of the deepfake advertisements and undo ubtedly, Banxso profited
handsomely from their investme nts. The deepfake advertisements were clearly
designed to lure client under false pretenses to invest their moneys in products with a
promise of unrealistic returns on such investments. There is also no doubt that agents
gave investment advice to clients contrary to Banxso’s FSP license.

[85] The contention that the enrichment which derives from Wentzel and the other
claimant’s loss, lies with the liquidity provider , is also unpersuasive. Banxso, in my
view did all the functions of a LP , despite the multiple off-shore entities it listed as
LPs. In any event, Sekler is a shareholder of Banxso and FCH. The losses of
Banxso’s clients are the profit of a LP. Banxs o has acquired and transferred
cryptocurrency to FCH in the amount of R 319, 985, 959, 00 for the period 17 April
2023 to 29 December 2023 . For the year 2024 a further total of R672 192 435 was
transferred in this manner. This equates to a handsome profit o f just over R 990
million that were pocketed from the misfortunes of Banxso’s clients. In addition,
further deposits by investors found its way in bank accounts of AheadStart and Volor
Vault that remains unexplained by Banxso.

[86] Another disturbing feature of Banxso is despite that its license was
suspended, it continued trading. Banxso advanced the following explanation: “no live
trading can take place, because there is no flow of funds between the client and
counter-party to any CFD. Simply put, no profit or loss reconciliation can and/or has
been done and as such, no profit or loss allocation can be attributed to any client’s
account. Any indication to the contrary, is merely a vi sual illustration and amounts to
what can be regarded as a “simulated” or “demo” trading environment. This is
symptomatic of the fact that the MT4 trading platform has remained active and cannot

symptomatic of the fact that the MT4 trading platform has remained active and cannot
be fully switched off, as it would adversely affect client’s open positions which have
already been impacted by the temporary freeze of the accounts.” This explanation is
seriously worrying as it goes to the heart of Banxso’s business model. What it shows
is that Banxso’s clients were trading on a simulated or demo trading environment not

knowing about it . These clients were therefore brought under a false pretense that
they were doing live trading. The latter is nothing but a deception in the true sense of
the word. The fact that monies may b e paid back does not undo the deceptive
conduct. Furthermore, according to Banxso it determines the trading rates to make a
profit. The question thus arises how Banxso d id it in these circumstances if it was
only a simulated training environment , as investors lost their initial investment s. This
is a further illustration that it is highly unlikely that Banxso operated as a “Straight
Through Processor”.

[87] On a conspectus of all the evidence, I am s atisfied that Wentzel has
established on a prima facie basis, that Banxso does not operates within the confines
of the law, and its business model is illegal . It follows the refusal by Wentzel and the
Intervening Parties to accept the provision of security via a stakeholder of Banxso
cannot be seen as an abuse of process.

[88] Wentzel, like all other investors , including the Intervening Parties has thus a
prima facie claim under the condictio ob turpem.

[89] In view of the abovementioned, the way Banxso solicited investments from
the public and the manner in which the losses occurred, militate against the exercise
of a discretion in its favour. It follows that Wentzel made a case out for the relief
sought in the notice motion.

[90] In the result the following order is made.

1. The order ‘X made order of this Court.


_____________
Le Grange, J

APPEARANCES:

For the Applicant & Intervening parties: R van Rooyen SC
MM van Staden
Instructed by: Mostert & Bosman

For the first respondent: J Muller SC
B Prinsloo
J Aspeling
Instructed by: Hanekom Attorneys

For the third respondent: S Miller SC
R Fitzgerald
Instructed by: Robert Chanles Inc

X



Republic of South Africa
IN THE HIGH COURT OF SOUTH AFRICA
[WESTERN CAPE DIVISION, CAPE TOWN]

Before the Honourable Judge Le Grange
At Cape Town on 22 August 2025

Case no: 23249/2024

In the matter between:

CAROL MARGARET WENTZEL Applicant

And

BANXSO (PTY) LTD First Respondent

THE FINANCIAL INTELLIGENCE Second Respondent

FINANCIAL SECTOR CONDUCT AUTHORITY Third Respondent

NATIONAL DIRECRTOR OF Fourth Respondent
PUBLIC PROSECUTIONS

HASSEN KAJIE N.O Fifth Respondent

And
... -

In the matter between:

ECONOMIC FREEDOM FIGHTERS Applicant for Intervention

And

DAVID VAN DER MERWE First Intervening Party

NICK RICHARD WEGGELAAR Second Intervening Party

LEON ALBERTUS DE MAN Third Intervening Party

SAUL GEOFFREY RUDOLPH Fourth Intervening Party

BAREND UYS VAN NIEKERK Fifth Intervening Party

CORNELIA MAGDALENA HUMAN Sixth Intervening Party

THEO JOHAN SCHOEMAN Seventh Intervening Party

MARIANA MARYNA DUVENHAGE Eight Intervening Party

MARLEEN SMIT Ninth Intervening Party

CHRISTIAAN THOEDORE BRUYNS Tenth Intervening Party

ORDER

IT IS ORDERED THAT:

1. The Intervening P arties are granted leave to intervene as applicants in this
application and, in future documents in this application, shall be referred to as the
Second, Third, Fourth, Fifth, Sixth, Seventh, Eight, Ninth, Tenth and Eleventh
Applicant respectively. The Applicant shall be referred to as the First Applicant.

2. The striking out application of the Applicant and Intervening Parties is granted
and the following parts of the First Respondent’s affidavits shall be struck out:

2.1 The First Respondent’s answeri ng affidavit: Paragraphs 113 -120, 293.1
(the portion which reads ‘I refer to what I have set out above concerning
the touting activities of the applicant’s attorney.’) 312.4; and the annexures
referred to in these paragraphs.
2.2 The First Respondent’s further answering affidavit: Paragraphs 5.2, 5.4
(the portion which reads, ‘have touted their way to twelve disgruntled
Banxso clients. ’), 6 -11, 12 (the portion which reads, ‘Those offers are
rejected out of hand by M&B.’), 17 (the portion which reads, ‘and/or
proceeded to give this bad advice to their clients thereafter.’), 18,21 -22,31
(the portion which reads, ‘It appears that the FSCA was asked for these
items and proceeded to advise M&B to simply issue them with a subpoena
as a “cover” for being able to justify their delivery.’), 195 (the portion that
reads, ‘M&B has proceeded in this liquidation for their own interests.’), 196
(the portion which reads, ‘given that Ms Wentzel et al appear to be M&B
proxies.’), and the annexures referred to in these paragraphs.

3. The First Respondent’s striking out application is dismissed.

4. The First Respondent is placed under provisional liquidation.

5. A rule nisi do issue calling upon the First Respondent an d all other interested
parties to give reasons, if any, on 17 October 2025 why:

5.1 The First Respondent should not be finally liquidated.
5.2 The costs of this application should not be costs in the liquidation of the
Respondent, which costs are to inc lude the costs of two counsel, with scale C to
apply in respect of senior counsel and scale B in respect of junior counsel.

6. Service of this order be effected by:

6.1. one publication in each of the Cape Times and Burger newspapers and
the government gazette.
6.2. service on the South African Revenue Service at 1 [...] L[...] L[...] Street,
Cape Town.
6.3. service on the Respondent at the Respondent’s registered address being
2nd Floor H[...] W[...], 1[...] S[...] Street, De Waterkant, Cape Town,
6.4. service on the Respondent’s employees, if any, at the Respondent’s
business ad dress being 2 nd Floor H [...] W[...], 1 [...] S[...] Street, De
Waterkant, Cape Town, by affixing a copy of the application and order to
any notice board to which the employees have access inside the
Respondent’s premises or, if there is no access to the premi ses by the
employees, by affixing copies to the front gate, if applicable, failing which,
to the front door of the premises.
6.5. service on all registered trade unions, if any, representing the
Respondent’s employees.


By Order of the court

___________________
Court Registrar