Misleading Narratives and Sensational Claims: The Flawed Logic Behind the Banxso Scandal Story

The recent Moneyweb article titled “Banxso refund scam escalates into sexual blackmail: Victim speaks out” presents a harrowing tale of digital manipulation and emotional trauma. However, while the human impact of such crimes deserves sympathy, the article makes a significant leap — suggesting, without hard evidence, that Banxso is somehow connected or responsible for the actions of the criminal network behind this scam.

This inference rests almost entirely on an alleged use of the same email address once associated with Banxso, any further indicators as to how the perpetrators gained the victims confidence have not been shared within the article. That threadbare link forms the foundation for a serious public accusation, yet no concrete evidence is offered to support a claim of corporate wrongdoing.

“There’s a big difference between a bad actor impersonating a platform and the platform being complicit,” noted a regulatory advisor familiar with South Africa’s financial services licensing regime. “From what I’ve seen, the story relies on implication, not investigation.

“By the article’s very inferences the FSCA are guilty of running a WhatsApp scam not the victims of identity theft.”

This is in clear reference to an alert issued on the FSCA’s (Financial Service Conduct Authority) social media pages a few weeks ago where they chastised the usage of an AI generated deep fake video impersonating their commissioner Mr. Unathi Kamlana to sell a trading tool called NBSG Securities or Nedbank Securities. The notice further highlights this is a scam and the use of logos and names is unauthorised.

Banxso has consistently denied any role in this or any other scam. Through its attorneys, Hanekom Attorneys, the company has reiterated that no data breach has occurred, and that no client data has been compromised or sold.

“Our client has not sold, shared, or otherwise disseminated client data to unauthorised third parties. Any suggestion to the contrary is false and defamatory… Further, our client has not experienced any confirmed data breach to date,” reads a formal letter submitted to the publication prior to release.

They further assert “In the circumstances, whilst our client again unequivocally denies the allegations and reaffirms the robustness of its security protocols, we formally request that any future enquiries be submitted in a bona fide manner, clearly delineating new and verifiable information warranting a response. Failing which, our client reserves the right to decline any further engagement on the subject matter.”

Yet Moneyweb published the story — one in a string of articles targeting Banxso — while giving minimal weight to these denials. This raises questions about intent, especially given the timing of events.

Liquidation in the Shadows

The article was released just days after a Western Cape High Court hearing on a liquidation application against Banxso. Moneyweb however, despite their intense interest in the matter failed to cover the case, IOL on the other hand applied to live stream the matter.

In open court, it was revealed that parties linked to the legal team of the applicants had built a campaign website collecting thousands of “client complaints” as well as this their legal team relied heavily on Moneyweb’s own collection of “in excess of 200 victims’ information”.

The presiding judge, Honourable Judge Le Grange, openly questioned the role of the touting within this process. Touting refers to the unethical and often illegal practice of lawyers or their agents’ soliciting clients, particularly vulnerable individuals. This is prohibited by the Legal Practice Act and the Code of Conduct for Legal Practitioners, as it undermines the integrity of the legal profession. Offenders can face disciplinary action, including suspension or being struck off the roll of legal practitioners.

When Moneyweb was cited repeatedly as a source of claims, the judge dismissed it brusquely: “Moneyweb is Moneyweb.” He also pressed counsel on why the liquidation applicants legal team saw the need to create such a website if not for the express reason of touting clients.

“There are concerns this is less a liquidation and more a coordinated campaign — with media stories used to generate public support and potentially sway judicial opinion, Moneyweb themselves have solicited individuals to come forward while simultaneously publishing the website in question,” said a legal expert with experience in financial services litigation.

Another red flag highlighted by Honourable Judge Le Grange was that users were reportedly required to select a liquidator on the website promoted by Moneyweb and set up by those close to the legal parties before being allowed to submit complaints. This process raises significant questions about motive, particularly if liquidation is being driven by a narrow set of actors with a commercial stake in the outcome.

A Contradictory Narrative

The victim in Moneyweb’s latest story appears to have lost money while trading on Banxso’s platform — and later engaged with a third-party scammer who claimed to help her recover it. This person ultimately took over her device, accessed her online life, and used coercive tactics to extort her.

These actions are despicable. But they are also not unique. South African cybercrime units report a growing number of similar incidents across many industries — from dating platforms to online banking portals.

“We’re seeing an explosion of hybrid scams: crypto, romance, recovery fraud, all blending together,” the regulatory advisor noted. “To single out Banxso with no technical evidence does more harm than good.”

The victim’s own testimony reveals she was surprised to learn her supposedly lost funds had “generated” profits, and this unexpected turnaround was used to lure her into granting further access. This inconsistency — losing everything, then being told there were new profits — should have raised alarms and again leads into questions about greed being the motivating factor asked by the Honourable Judge Le Grange in the matter.

The Cost of Careless Reporting

This is not the first time of late that the media has misrepresented key facts in the Banxso matter. In the last week, multiple publications namely News24 and BizNews — have issued corrections after wrongly reporting that Banxso had been placed into provisional liquidation or had its licence suspended earlier than it was.

“When media platforms publish errors without formal apologies, it creates an information fog. Reputational damage lingers long after the facts are corrected, the chances of an individual reading an article twice to see if an asterisk has been placed or a fact innocuously changed are slim,” said the legal expert.

Banxso is now pursuing legal action against Moneyweb and editor Ryk Van Niekerk (the author of this latest and other articles) in what it believes is a deliberate effort to undermine its business and falsify a narrative that has led these scammers being given the green light to operate.

Hanekom Attorneys note within their letter to Moneyweb: “It is both ironic and deeply concerning that you now express concern over scams targeting former clients, particularly when your own repeated publication of unfounded claims, speculation, and inflammatory narratives has directly contributed to the climate of fear and distrust that such scammers exploit.”