In a first, the South Africa Reserve Bank (SARB) has issued a forfeiture notice to a local crypto exchange.
According to a local media outlet, SARB issued a notice of forfeiture against a firm called Silver Tiger Trade for more than R5 million ($286,780) in assets held in accounts at Standard Bank and crypto exchange, Ovex.
The seized funds will be deposited into the National Revenue Fund (the central fund for national government).
This marks the Reserve Bank’s most recent forfeiture under exchange control regulations. The notice, however, provides no specifics regarding the alleged violations.
It is not clear if this is the first notice sent by the bank to Ovex, but a forfeiture notice is available on the South African government website signed by Fundi Tshazibana, who is Deputy Governor of the Prudential Cluster at the bank:
By virtue of the functions, powers and/or duties vested in me, in my capacity as the Deputy Governor of the South African Reserve Bank, in terms of the delegation and assignment of the functions, powers and/or duties referred to in 1 above, I hereby give notice of a decision to forfeit to the State the following money and/or goods and I hereby declare and order forfeit to the State the following, namely:
2.1 the amount of R2 778 608.29 being capital standing to the credit of Blue Electro Investments (Pty) Limited held in account number 2817993000 at The Standard Bank of South Africa Limited, together with any interest thereon and/or other accrual thereto;
and2.2 20 485.15 USDT held at Ovex (Pty) Limited in account number 188116, standing to the credit of Blue Electro Investments (Pty) Limited, together with any interest thereon and/or other accrual thereto.
Regulation 22A of the Exchange Regulations permits the National Treasury to confiscate assets connected to or suspected of being linked to violations of exchange control rules. The regulations are broad enough to enable asset seizures without the need for a conviction.
In contrast, assets can also be seized under the Prevention of Organised Crime Act, but this requires a conviction of at least one of the involved corrupt parties first.
Since the South Africa Financial Sector Conduct Authority (FSCA) approved some 138 license applications to cryptocurrency asset service providers in the country, experts have warned digital asset users of increased scrutiny from authorities.
🇿🇦REGULATION | South Africa Appproves 63 New Crypto License Applications, Now Totalling to 138
“The total number of applications received to date is 383, of which five have been declined. A further 80 applications have been voluntarily withdrawn by applicants following… pic.twitter.com/uIXDCHBUGW
— BitKE (@BitcoinKE) July 3, 2024
Most recently, the South Africa Revenue Service (SARS) is now issuing tax notices to crypto traders.
🇿🇦REGULATION | The South Africa Revenue Service (SARS) Begins Issuing Tax Notices to Crypto Traders
Failure to provide requested information could be deemed a criminal offense under the Tax Administration Act, the officers say. The national revenue authority has adopted a… pic.twitter.com/NZ5vJJlHZz
— BitKE (@BitcoinKE) September 9, 2024
According to officers at local law firm, Webber Wentzel, these notices are based on information obtained from various crypto asset exchanges, signalling a significant escalation in SARS’ efforts to enforce tax compliance within the burgeoning crypto sector.
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