In a stunning backflip, South Africa’s FSCA has given up on regulating Karatbars International.

In response to the FSCA’s initial securities fraud warning last month, Karatbars informed the FSCA

that it markets two products in South Africa, one being the sale of gold bullion and the second the sale of a crypto-asset to be launched on a future date.

The “crypto-asset” it was triggered the FSCA’s warning, as Karatbars and its affiliates heavily promoted its KBC shitcoin as a passive investment opportunity.

Rather than investigate Karatbars claims, which would have quickly revealed KBC promotion dates back to at least July 2018, the FSCA appears to have taken the company’s claim at face value.

In an update published on December 13th, the FSCA advised

Neither of (Karatbars’) products fall within the definition of a financial product or service.

As such, they are not registered by the FSCA and fall outside the ambit of our jurisdiction.

And there you have it. South Africa’s top securities regulator refusing to regulate a blatant unregistered securities offering.

Unfortunately the FSCA rolling over on securities fraud means Karatbars and local promoters are free to continue promoting KBC investment across South Africa.

After pumping to 12.2 cents in the lead up to Karatbar’s hyped July 4th launch event, KBC dumped to 2 to 3 cents by the end of the month.

Nothing much has changed since then. Not that it matters, Karatbars management and its top promoters cashed out during the pump.

Sorry for your loss South Africa. What a shame your government doesn’t care.