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Ladysmith bitcoin scheme owner’s house set alight by angry mob

Bitcoin scheme owner, Sphelele “Sgumza” Mbatha’s home in Ladysmith, KwaZulu-Natal was allegedly set alight on Wednesday by angry community members following an announcement by him during a radio interview that their investments had been stolen.

On Tuesday evening Sgumza announced on radio Nqubeko FM that his Bitcoin Ponzi scheme website had allegedly been hacked and investors’ monies had been transferred into fraudulent accounts.

The angry mob gathered at the Ladysmith Police Station as rumours on social media indicated that Mbatha had been detained after trying to run away with people’s money, however police said it was not the case and he had not been arrested.

Mbatha’s Bitcoin Wallet had been the talk of Ladysmith for months as he promised to pay 100 percent returns on investments within 15 working days.

He had earned the nickname “Lord of Ladysmith” as people saw him as the way out of poverty, and he was often seen living large and carrying wads of cash.

His reputation preceded him as he would pay other people’s grocery bills, give out R100 notes to anyone in the streets and malls and often throwing lavish parties.

People came to Ladysmith specifically to invest in the scheme, some even sleeping outside the premises to ensure they were first in line the following day, investing as much as R100,000 or more into the scheme.

Mbatha was forced to move the business online as the gathering of people resulted in a municipal by-law violation.

He claimed to be investing the money in low rate cryptocurrency Bitcoin and selling it back as the market improved.

After a local newspaper article stated that he did not have the cash to refund investors, and that he claimed to only be a manager and not the business owner, the community members and investors gathered at Mbatha’s parental home in Tsakane, demanding their initial investments back, without the profits, but he was nowhere to be found.

They proceeded to loot some furniture from inside the house and then set it on fire with a luxury BMW still parked in the garage.