The South African Police Service (SAPS) has announced significant developments in the investigation of the R2.8 billion BHI Holdings Ponzi scheme. The Hawks’ Serious Commercial Crime Investigation unit has arrested Sona Pillay (54) and Michael Philip Adam (55) in connection with the fraudulent scheme.
Pillay was apprehended on Friday, 31 May 2024, after an attempt to flee overseas. He was refused entry and returned to South Africa, where he was met by the Hawks’ investigating team at OR-Tambo International Airport (ORTIA). Adam surrendered to authorities on the morning of 3 June 2024. Both suspects have since appeared in the Palm Ridge Specialised Commercial Crimes Court.
The Ponzi scheme, which began in 2008, deceived investors into believing their capital investments would generate returns exceeding 10% interest. However, like most Ponzi schemes, BHI Trust failed to deliver the promised returns. Instead, it used new investors’ funds to pay off earlier investors, creating the illusion of profit.
The scheme’s collapse resulted in substantial financial losses for investors. Graig Roy Warriner, a key figure in the scam, has already been convicted and sentenced to 25 years in prison on 206 counts of fraud and one count of contravening the Financial Advisory and Intermediary Services Act for operating an unlicensed investment scheme.
Warriner has been incarcerated since his arrest in August 2023, culminating in his recent sentencing. Authorities expect more arrests as the investigation continues.
The Palm Ridge Specialised Commercial Crimes Court has postponed the case for seven days, setting a formal bail application hearing for 10 June 2024. Pillay and Adam remain in custody.
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Major General Ebrahim Kadwa, Gauteng Provincial Head of the Hawks, expressed satisfaction with the progress of the investigation. “We are pleased with the progress made and we are looking forward to the finalization of the case,” he said.
The public is warned to be wary of investment schemes promising unusually high returns, as such schemes are often fraudulent.
