Is Kastelo a DA woopsie?
· Citizen
If Kastelo were still operating today, what a great marketing opportunity this would be.
Visit playerbros.org for more information.
Full disclosure: I’ve been a client of Kastelo for some three years and loved the regular emails telling me that I’ve just made another R250 bucks for leveraging my foreign investment allowances.
Best of all, I hardly had to lift a finger – send in a few signed forms, a power of attorney, and by the end of the year, I had an extra few thousand in hand.
The antis are quick to speak of the 4 billion outflow, but the money that came to clients (myself included) had to come from somewhere.
The idea of crypto arbitrage is that you invest money abroad and take the spoils based on differentiation in currency value when the time is right.
Granted, it’s more complicated than explaining the Marvel Cinematic Universe to anybody preparing to make Doomsday their first watch of the series, but the outcomes show the result; more money came in than went out.
There are other considerations like how much of various currencies we hold in reserves in our own. You know who governs that? The state apparatus through the likes of SARS, the executive and the Reserve Bank.
This is why our ability to invest abroad is limited. If it was such a big issue, then why would the discretionary limit be raised from 1 million a year to 2 million in the time that Kastelo had been operating for years? Surely if you notice too much outflow of currency reserves, you don’t double the size of the filter’s pores.
The big freeze
And this is not exactly an entity that operated as a fly-by-night register today, tender tomorrow. It was (and remains) a registered financial services provider.
The 8 months its accounts have been frozen is 80 times longer than Lighthouse Publishers existed before getting a R1.6 billion tender, twice as long as Swifambo Rail Leasing existed before getting R3.5 billion from PRASA and 40 times longer than some companies took Independent Development Trust’s millions for an oxygen plant installation tender.
I’m delighted that the financial regulation framework is so on the ball that they can bust a company for alleged wrongdoing years into its operations. Shouldn’t there be an outcome by this point though?
If the state can just block off the accounts of companies for as long as it wishes, isn’t there some accountability regarding how long?
That’s what this whole court case is about in the first place. It was never engaged to prove any guilt or misconduct. The case was brought by Kastelo to unfreeze its account; something you probably wouldn’t do if you had something to hide.
Yet, the sharks are coming in, taking the financial regulator’s affidavit as gospel and even laying criminal charges against individuals.
If only they did this to all the directors of companies which have demonstrably dodgy dealings, not just the one associated with the guy from the party we’re not allowed to like.
Before discussing whether there’s anything amiss with Kastelo and the DA’s finance dude, we need to at least agree that the conversation must extend to whether anything is amiss with the regulatory infrastructure; why did it take so long, why is it still taking so long, and why did the systems in place accommodate it?
It may seem like voodoo; how is it that I can just make money by letting a company trade off my name – I understood it after spending lots of time wrapping my head around it, but the complexity still exists, and with that complexity there will always be risks. Most people don’t know how the stock market works, or retirement savings, yet those systems still exist.
The DA’s moemish
That’s where the DA has come in with an own goal…again. If Burke is such a good finance dude and important for your team, make sure the potential controversy around him is dealt with before it becomes a problem.
None of this would be the case if they made a big song and dance about Kastelo’s platform being a great idea and one that leverages opportunity to create economic positives, which is what Burke is going to bring to DA policy.
Let’s not forget that it was Burke who took on the ANC’s great idea of hiking VAT and beat it down.
Innovation doesn’t come without risk, and if the DA isn’t willing to take those risks and bet on people who innovate, then it shouldn’t appoint them in the first place.
If the DA wants people who do big things, it needs to prepare to back them in times like this or, at the very least, do a background check that would have revealed the possibility of this happening.
If you can’t even protect yourself against political opportunism…
By the way, on the subject of exchange controls, how is this any different from a bunch of dollars under a mattress?