Valorworx: Ponzi scheme ‘broke us,’ victims say

A high-stakes investment scheme promising sky-high returns and shrouded in the illusion of legitimacy has left a trail of financial devastation. Valorworx, the company at the center of this scandal, appears to have offered a unique opportunity. However, the reality turned out to be much more vile.

The IRS Forensic Investigations Service, led by investigator Chad Thomas, unravels a classic Ponzi scheme orchestrated by romantic couple Alessandra Valecic and Elmarie Doukas. While their romantic relationship apparently came to an end, it was the investors who found themselves on the bad side of the breakup.

Thomas said the promised return was expected to be between 30% and 50% of the investment within three months. “However, when it came time to pay, no payments were made to anyone,” Thomas said.

“Investors were involved in the scheme through close circles of friends and relatives. This is called affinity fraud, and because the recommendations came from people trusted by others, it increased the sense of legitimacy.”

Huge Profits Promised Through Valorworx

Valecic and Dukas used personal connections to expand the scheme. “They build trust, and before you know it, people are hooked,” Thomas explained.

One of the early investors, Mike Rose, told how he was introduced to the scheme by a friend who had already seen profits. “I invested R500 000 myself,” he said. “I even brought my father in for another R200 000 after seeing my friend get paid. At first it seemed like a win-win.”

Rose’s initial faith in Valorworks was bolstered by documents that seemed to indicate significant profits. “They made it sound like our money had doubled,” he explained, “so of course I trusted that.”

But it was all smoke and mirrors.

Watch: IRS Forensic Investigator Confronts Doukas

The success of this scheme depended on a vicious circle of reinvestment. Many early investors were paid small amounts, essentially as bait to attract more money. Rose explained how he showed others his early successes, convincing family and friends that Valorworx was a great opportunity.

“That’s how they create this investment frenzy,” he said. “They let a few people win, show them the money, and then everyone wants a piece of it.”

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Ponzi scheme numbers are staggering

The number of participants is staggering. According to Thomas, about 86 people were victims of Valorworx, with total damage estimated at R25-35 million.

For some victims, these losses were more than financial; lives and livelihoods were destroyed. “For many, this was the last hope after Covid-19,” Thomas said. “Some people have lost everything.”

Another investor, Michael Fox, invested his R400 000 savings after a friend introduced him to the scheme. He was hoping for a comeback that would ease his financial stress post-Covid.

“I thought it was a great opportunity,” Fox said. “But by the start of 2022, I started to feel like something was wrong. They offered me a second investment opportunity, promising even higher returns, but then the communication just stopped.”

The silence spoke volumes to him, and Fox’s anxiety grew. “Every time I called, there was a new excuse, a new delay.”

For Fox and others, the greatest insult was watching criminals flaunt their ill-gotten wealth online. Photos of Valečić and Doukas traveling around the world, vacationing on yachts and enjoying exclusive resorts were scattered across social media.

“I’d like them to live off my money,” Fox said. “They were enjoying Ferraris and first class travel while I was struggling to understand where my savings had gone.”

The couple even manipulated the images, posing with Facebook founder Mark Zuckerberg and posting selfies with local celebrities such as Jack Parow.

Best friends with Facebook’s Zuckerberg… no

This public display of excess was more than a sore point for investors; it was the clue that Thomas said he needed to piece together the extent of the fraud.

“It became clear that this was not generational or hard-earned wealth, but investors’ money funding their luxurious lifestyle, including the rental of expensive penthouses on Cape Town’s exclusive Atlantic coast,” Thomas said.

To further anger investors, attempts to recover funds or confront the couple were often met with avoidance tactics.

Doukas recently appeared at Pinetown Magistrates’ Court after asking the justice system for protection from victims demanding their money back.

“In cases like this,” said lawyer Julio Ciani, who represented the victims, “people will go to great lengths to delay trial, move around to avoid service and claim victim status as a distraction.”

The consequences of fraud are very serious

For the victims, the emotional toll has been severe, with some even having damaged relationships with family and friends. Rose, one of the first to involve a relative, her father, in the scheme, felt the burden of betrayal when everything collapsed.

“It was terrible to think that I dragged people I loved into this mess,” he said. “Fortunately, my family understood this, but others were not so lucky. It tore people apart.”

Thomas said it took a huge toll on the victims’ mental health. “People were counting on this income, and when they realized that there would be no money, some fell into deep depression.”

Victims don’t just want their money back, they want justice. “I know I’ll never see my money again,” Fox said. “But I want them to go to jail. I want them to pay for what they did.”

According to Thomas, Valorworx Ponzi is emerging from a wider trend, with financial crime on the rise in South Africa.

“Every year we see a marked increase in the number of reported cases,” he said. “The sad reality is that only a small proportion of these crimes are ever reported. Many victims are too embarrassed or hopeless to come forward.”

And because of the limitations of the judicial system, he noted, the scammers behind these schemes often elude justice.

“Until there are real consequences, we will see more and more of these schemes. People are looking for alternatives to traditional investments, and unfortunately these predators are waiting,” Thomas said.

Citizen Doukas and her lawyer were approached for comment at Pinetown Magistrates’ Court but her bodyguard blocked all access to her and the lawyer said it was beyond his authority.

Hawks spokesman Colonel Katlego Mogale confirmed the matter was under investigation.

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