FSCA warns public against SD Farmlink

The latest warning from the Financial Sector Conduct Authority (FSCA) against an unregistered investment scheme has opened up an interesting can of worms.

In this case, a former contestant in the Mr SA beauty pageant promised people returns of 240% per annum for investing in his farming stokvel. The FSCA warning is just the normal short announcement.

“The FSCA warns the public to act with caution when dealing with SD Farmlink (Pty) Ltd. SD Farmlink claims that it offers various investment opportunities to its clients with the goal of empowering and creating jobs for youth and women in agriculture (through a livestock stokvel).

“These investment opportunities involve clients investing an amount of money with a fixed monthly return on the investment over a specified period. Clients also allegedly receive benefits related to starting a livestock farm.

“SD Farmlink is not authorised as a Financial Services Provider (FSP) in terms of the Financial Advisory and Intermediary Services Act, 2002 (FAIS Act), neither is it a registered stokvel in terms of the Friendlies Societies Act,1956.

“Furthermore, it is not authorised to solicit deposits from members of the public,” according to the announcement.

The internet yielded much more in terms of interesting titbits, despite the fact that the SD Farmlink website has been disabled.

Complaints

Apparent investors started to complain a year ago that Sinethemba Dleke had solicited investments but not paid the promised returns.

One of the investments, discussed by Dleke in an online video channel interview on Private Property (see below), promised investors a return of R500 per month for 12 months when investing R2 500 – a nominal return of 240%.

Dleke claimed in the interview that he owns a 200-hectare farm in the Eastern Cape, grows cabbages, spinach, green peppers and potatoes, and keeps 10 000 chickens. A portion of the farm was, he said, fenced to keep livestock.

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Other sources quoted Dleke as saying he owned a 15-hectare farm. He also claimed to have a ready market for produce, naming a few well-known retailers as customers.

But at the time of the interview a year ago, investors were already complaining. One investor complained in commentary to the video clip that SD Farmlink is a “scam” and that she got nothing back after investing.

Complaints started to snowball in the past few months.

“I’ve invested R50 000 plus R500 for the shipping fee amount they require,” one apparent investor wrote on Hello Peter.

“I’m expecting to be receiving my money between the 10-15th September as I invested in June and I was told that it will take 4 months instead of 3 due to their bank issues. I’m really worried cause their lines are going on voicemail and the director does not respond to his DMs [direct messages] on Instagram and a lot of people are already complaining about this company.

“The money I invested is a lot of money. I can’t afford to just loose (sic) it like that.”

“Sinethemba Dleke is a SCAMMER,” wrote another alleged investor in August 2022.

“I was also scammed by SD Farmlink and Sinethemba. Upon payment of my investment amount I got no communication whatsoever. I then tried to call all of their multiple numbers and no one answers the call.

“I WhatsApped all of the numbers and I was ignored for weeks. One of the WhatsApp numbers replied to me saying accounts are frozen. I asked them why they still have the website up and still take people’s money and they said it’s the discretion of the director Sinethemba and they are just employees.

“So clearly Sinethemba is deliberately taking people’s money and scamming them!”

Another person complained that she is suffering, while Dleke is posting pictures on social media about his “soft life”.

‘Ask somebody else’

Nobody answered any of the telephone numbers listed in an advertisement punting SD Farmlink, and an email to SD Farmlink’s last known email address went unanswered.

Moneyweb eventually got hold of Dleke, but he refused to answer questions about the FSCA warning. “Go and ask them,” he said.

“Go and ask the internet,” Dleke responded when asked about the activities on the farm and his online promotion of SD Farmlink.

The only communication the erstwhile investors received was a post on social media platform Instagram. The announcement states that SD Farmlink is under investigation and that its “legal team” is working with the banks to resolve the problem.

Attributed to the founder of SD Farmlink (Dleke), the letter says “we can assure you that you have not lost your investments and will receive them in full”.

“Our goal is for every member of SD Farmlink to receive what’s due to them and we hope but that we will continue to work together after this misunderstanding has been cleared out as we continue to build our communities through agripreneurship.”

‘Official’ letter to SD Farmlink members

Moved on

At the same time, Dleke got involved in another venture – which shares several similarities with SD Farmlink.

Micasa Property Lifestyle is described as a property “stockvel” and promises to assist disadvantaged people with property investment.

Once again, there is emphasis on people working together in a stokvel to help each other, because “together we can do more”.

It apparently offers different investment/savings plans, but its Facebook page only provides details on one. Revamp Club requires a non-refundable joining fee of R1 000 and thereafter 12 monthly contributions starting at R2 500.

After 12 months, investors are offered building services: either renovating an existing house or building a new house.

There is no mention whether this stokvel is duly registered or if its investment/savings plans have passed the scrutiny of the authorities.

It is worth repeating the FSCA’s usual warning at the end of its several-times-per-month warnings: “Members of the public should always ensure that an entity or individual is suitably authorised by the FSCA to provide the specific financial product or service being offered. Check this before any purchase or investment is made.”

Read: The scam of 2% loan offers

Deeper impact

The worst part of investment scams and unscrupulous operators is that their consistent advertising overshadows and crowds out legitimate companies offering financial services.

Online advertising throws fake and real investment offers out without any distinction.

New investors – those who scammers are always promising to help – are thus effectively excluded from financial services.