An expatriate South African businessman accused of running a massive pyramid scheme that cost wealthy investors up to 1.2 billion US dollars has denied any wrongdoing, reports said Saturday.
Barry Tannenbaum, who lives in Sydney, has been accused of fleecing rich South Africans in what has been billed as one of the country's biggest Ponzi-style investment scandals, according to local and South African media.
But Tannenbaum had denied running a scam in which he allegedly offered 200 percent annual returns for people investing in his pharmaceutical import businesses, the Sydney Morning Herald reported.
"Absolutely not," he told the newspaper when asked if he had set up a Ponzi scheme similar in structure to the one masterminded by US businessman Bernard Madoff, who netted 65 billion dollars in investors' cash.
"I have read with amazement that I have been guilty of a multi-billion-rand scam and that I am compared to Bernie Madoff in the USA," he said in a statement posted by the Herald.
"As has happened with other companies that have from time to time found themselves in a financial predicament, particularly in the present climate, I have found myself in such a situation," he said.
Tannenbaum, 43, a relative of one of the founders of South African pharmaceuticals giant Adcock Ingram, denied any fraud and dismissed the claims against him as "wild allegations" that would prove to be exaggerated.
"In short, the hype at this stage is such that whatever I say, will be disbelieved. Time will demonstrate that I have defrauded no one," Tannenbaum was quoted as saying.
No formal charges have been laid in the case in South Africa. Tannenbaum could not be reached for comment by AFP.
But private investigators allege in documents that Tannenbaum's company forged purchase orders for AIDS drugs to reassure investors when returns were not forthcoming, South African newspapers reported.
South African lawyer Paul Winer, whose Johannesburg law firm Werksmans is representing some of the investors who lost money, told the Australian Broadcasting Corporation the failed scheme appeared to be suspect.
"It's probably the biggest Ponzi scheme we have seen in South Africa," he said.
While it was difficult to estimate exactly how much money was owed, it was bound to be a huge amount, he said.
"It varies because you don't know where the investors are, and if you convert the currency it could be anything between five and 10 billion South African rand (600 million to 1.2 billion US dollars)," he said.