Warren Wheatley has resigned as CEO and employee of Africa Bitcoin Corporation, effective September 21, following a decision by the Financial Sector Conduct Authority (FSCA) to debar him and impose a R5 million administrative penalty. The company announced his resignation in a SENS announcement on Tuesday. Wheatley co-founded Africa Bitcoin Corporation, formerly known as Altvest Capital, with his wife. The FSCA action relates to orders and trades in Altvest shares in September 2022.
According to Wheatley, the trades occurred while he was testing a stockbroker trading platform that had historically not functioned correctly. He said three trades involving a combined 50 shares, worth R301, were executed during the testing. Wheatley disputes the FSCA's findings, which alleged that he, along with two other executives, engaged in conduct that resulted in an artificially inflated share price and/or a false or deceptive appearance of demand, supply or trading activity.
Wheatley said in an open letter that his decision to step down was voluntary and intended to put the interests of the company, its employees, and shareholders ahead of his own while he challenges the FSCA decision. He will apply to the Financial Services Tribunal for reconsideration of the regulator's decision and for the sanction to be suspended while the matter is considered. Wheatley's resignation was made "without any admission of wrongdoing" and without giving up his rights before the Financial Services Tribunal.
The FSCA had debarred Wheatley for 20 years and imposed a R5 million penalty on him. Stafford Masie will continue as interim CEO as the company searches for a permanent successor. Africa Bitcoin Corporation said Wheatley's reconsideration application and related Financial Services Tribunal proceedings were personal to him and would continue independently of the company. The company's board accepted Wheatley's resignation.
Wheatley said his role had effectively been in abeyance since the FSCA decision was communicated to the company at the end of August. He stated that the company could not wait for the tribunal process to be finalised, and that the company, its staff, shareholders, investors, and SME clients were better served by active leadership rather than by him staying in office. Wheatley will continue pursuing his applications before the tribunal and will support the board in appointing a new CEO.
The controversy surrounding Wheatley and Africa Bitcoin Corporation began with the FSCA's findings on the Altvest shares trades. The regulator found that Wheatley and two other executives had engaged in conduct that resulted in an artificially inflated share price. Wheatley disputes these findings and maintains that his actions were part of testing a trading platform. The case has significant implications for the cryptocurrency and financial sectors in South Africa.
Wheatley's resignation and the FSCA's actions have raised questions about the regulation of cryptocurrency and financial markets in South Africa. The case highlights the challenges of balancing regulatory oversight with the need for innovation and experimentation in the financial sector. Africa Bitcoin Corporation will continue to operate under interim CEO Stafford Masie as it searches for a permanent successor to Wheatley.
Key points
- Warren Wheatley resigns as CEO of Africa Bitcoin Corporation amid FSCA penalty
- Wheatley disputes FSCA findings and will challenge the decision in the Financial Services Tribunal
- The case has significant implications for the regulation of cryptocurrency and financial markets in South Africa
