Bitcoin Africa: Wheatley disputes the allegations
The case had already rocked Africa Bitcoin Corporation in September. BrefCrypto reported at the time that the FSCA had sanctioned three ABC executives over trades carried out in 2022, several years before the company adopted its Bitcoin strategy.
Wheatley has now provided his detailed account.
At the time, the company was still called Altvest and was preparing an offering that would allow individuals to invest in private and alternative assets. It had acquired a brokerage operating on the Cape Town Stock Exchange.
According to Wheatley, platform testing uncovered several problems: incorrect portfolio valuations, inaccurate acquisition-cost calculations and potential errors involving taxable capital gains and losses.
In response, he allegedly asked his wife, Tatum Keshwar-Wheatley, and an analyst to place trades from their respective accounts while taking screenshots.
Three trades were ultimately executed, involving 50 shares and 301 rands.
The FSCA reached a radically different conclusion: the three individuals allegedly acted together to create an artificially high price and give a misleading impression of demand or activity in the stock.
A share price increase from 6 to 6.20 rands
Wheatley does not deny that the trades moved the price. He acknowledges, in particular, that one transaction pushed the share price from 6 to 6.20 rands.
He disputes the intent, however.
The former executive says he made no profit by later selling his shares. On the contrary, he says he continued to invest nearly 15 million additional rands in the company and increased his stake by about one-third.
His argument is not that the method was appropriate. Wheatley himself acknowledges that using genuine trades to test the platform was a bad idea and that a penalty may be justified. His main challenge concerns the characterization of the conduct as intentional market manipulation and the severity of the punishment imposed.
The FSCA maintains that the coordinated trades carried out between September 5 and 8, 2022, artificially influenced the price and created a false or misleading appearance of activity in Altvest shares.
The distinction matters.
301 rands refers to the value of the three trades, not necessarily their ability to influence an illiquid stock. In a thinly traded share, even very small orders can change the displayed price.
That is precisely what the Tribunal must now assess.
The case puts pressure on Africa Bitcoin Corporation
Wheatley has asked the Financial Services Tribunal for two things: reconsideration of the FSCA’s decision and a temporary suspension of the sanctions while the appeal is reviewed.
The Tribunal is independent of the FSCA and can review decisions made by South African financial regulators. Wheatley hopes an initial hearing on the suspension can take place before the end of October, while the substantive proceedings could take considerably longer.
In the meantime, the consequences extend beyond his personal situation.
Wheatley has stepped down as CEO. Stafford Masie is now leading Africa Bitcoin Corporation on an interim basis, following a governance crisis that BrefCrypto covered when the FSCA first imposed its sanctions.
The group holds approximately 5.5 BTC, far short of its initial ambition to raise several billion rands to build a substantial Bitcoin treasury. Wheatley says the regulatory proceedings also derailed a capital raise and plans to list on London’s Aquis Exchange. That listing had already been delayed in August.
Bitcoin is still not at the heart of the case.
The trades date back to September 2022. The BTC treasury strategy came several years later, and Africa Bitcoin Corporation itself was not sanctioned in these proceedings.
What remains is a much more conventional market question: were three trades totaling 301 rands misguided internal tests or coordinated price manipulation?
The FSCA has already reached its verdict.
Wheatley now wants to persuade the Tribunal that it went far too far.
