By Tracy Anne Bonareri and Felix Muthoka
Scammers are tenacious. They move quickly and capitalize on weakness. When one scheme fails or gets exposed, they simply rebrand and start again under a new name. After all, what are the chances of being caught in the same lie twice?
In a months-long investigation into a scam that had taken root in Kenya, we look into how one scam that resurfaced after going underground, recruiting new victims with a new name, and moving with a confidence that suggested that they thought no one would recognize them.
This time, the scam was a cryptocurrency token that they claimed was powered by artificial intelligence, and to make it even more convincing, they spoke Kikuyu, a ploy to make them appear more down to earth, and which making their manipulation feel familiar and believable.
The Prequel That Set The Stage
The story begins in 2024. Mary, not her real name. She was introduced to the RXM Group Corporation, a company claiming to be a global advertising agency, affiliated with luxury brands.
Mary was told she could earn money by watching ads. She needed to invest KSh 2,500 (US$20), and after that, she could start earning money from watching ads, KSh 16 (US$0.12) per ad. She needed to watch 5 ads per day, earning KSh 80 (US$0.60) daily.
Her first week went by without a hitch; she even withdrew her earnings. But things took a strange turn in the second week. She was told she could only access half of her money, and that the rest was being “saved” for her. That didn’t sit right with her, so she asked her mother’s friend, who introduced her to the platform. She told her she was still earning, but only through referrals, since those were paid out instantly.
The scam was being run through a WhatsApp group. As Mary puts it, “It wasn’t really communication, it was just them giving orders, and we followed. The group had four admins who controlled everything. Anyone who complained about missing payments was immediately removed. They didn’t allow members to talk to each other, keeping everyone in the dark. If you tried to ask questions or make a comment, they’d threaten to lock your account.”
After three weeks without receiving any payments, RXM suddenly stopped working. The admins claimed that someone had tried to hack the platform and told users they needed to pay half of their original registration fee to reactivate their accounts. Some participants paid, hoping to recover amounts they had earned, some as much as Sh. 100,000, but soon after, it went completely offline.
“It wasn’t even an official app on the Play Store”, Mary explains. “it was just a website accessed through a link shared on WhatsApp.” This is a glaring red flag. One of the admins later appeared in the group pretending to be a victim too, apologizing to the members in the group and claiming to have been scammed as well.
Mary had had enough. She decided to leave the group, but the scammers still had her number. Soon after, she began receiving texts from one of the admins inviting her to a new investment opportunity, starting with a ‘financial empowerment forum’ at Michael Pot Gardens, in Ikinu ward, Githunguri Constituency, Kiambu County, 28 km from Nairobi.
Curious, and with some free time, she decided to check it out. As it turns out, the ‘new’ group was being run by the same people she had interacted with previously.:
“I found the same people right there with a whole new name”, she says.
The Sequel That Told the Rest of the Story
Mary shared the message with us, so we decided to attend the sessions ourselves, posing as potential investors and filming discreetly, to witness firsthand what was really being sold to the public. The attendees were locals from the surrounding villages, coming with the hope of making some extra income.
Few of the attendees seemed tech-savvy, and this may have been by design.
This time, the scammers localized the con, speaking in Kikuyu, with the intention being to appeal to the victims by using vernacular. By crafting the presentation in this way, the goal was clearly to persuade the audience that the opportunity was credible. The masterminds behind this scam clearly understood the power of language, and they weaponized it efficiently.
We attended three sessions, each led by a different speaker. This may have been another attempt to confuse the audience further, making it difficult to identify one single person to blame if things went wrong.
In one of the sessions, a woman explained the various investment packages. She walked the audience through the trading process, claiming that an AI bot handles everything using a “universal algorithm.”
She used plenty of financial buzzwords and relied on tropes to create the illusion of authority. She asked the crowd if any of them had read Rich Dad Poor Dad by Robert Kiyosaki, or any such books. The room stayed silent, and she took this as her cue to urge people to invest in positioning herself as the most well-read person there and banking on the impression that her supposed knowledge made her credible.
She presented a complex investment model that, at least on the surface, promised a steady return. “As a trader”, she said, “you earn 1.1% profit daily on the amount deposited, which comes to about KSh 4,800 per month for a $100 package.”
The $100 she mentioned was the minimum deposit amount, which would be converted to Kenya shillings at a rate of KSh 150 per dollar. The minimum deposit she was asking for is KSh 15,000, and the reason she gave as to why the rate was higher than the Central Bank rate is that it included unexplained ‘transaction charges’.
Whenever attendees whispered among themselves or tried to ask questions, she became visibly irritated. She told them not to discuss money matters, which is a strange ask, given that they were at a financial literacy forum.
She insisted that finances are personal, and that everyone needed to make their own decisions. At one point, she even warned that some people carried bad energy, a statement that turned the other attendees into the enemy, and which made some in the room keep quiet. Anyone who asked for clarity on things that didn’t add up was taken outside for a private explanation, a move that seemed less about helping them understand and more of a divide-and-conquer strategy to eliminate them from the group before they could plant doubt in others.
This tactic was also employed within the RXM scam.
To encourage people to invest as much as they could, they promoted the more expensive packages starting at $100, to which they promised an instant bonus of KSh 1,000 for anyone who invested on the spot. In some instances, they offered as much as KSh 4,000 as incentives. They referred to these bonuses as “lunch money,” giving the attendees more incentive to invest.
After the speeches, the calculations, and the promises, the recruiters rarely left empty-handed; some attendees were convinced to invest on the spot. By the time we learned about the meetings in Ikinu, at least two sessions had already taken place. Before we arrived, a man we’ll call “Peter”, whose identity we’re protecting because he lives in the community, had already signed up. He invested in the Professional AI package $100-$499.
He first deposited KSh 15,000, then added another KSh 30,000, bringing his total to KSh 45,000. His experience picks up where Mary’s left off, revealing the challenges he faced at the hands of the same recruiters.
The Red Flags That Followed.
Just like the RXM platform, the Capital40 trading platform is also hosted on a website rather than an app. A key sign that this is a scam is the fact that they only share the link after you invest in one of their packages. Rather than allowing customers to do their due diligence first, the scammers use pressure to get people to invest through a website that could disappear at any time.
Their leadership, as outlined on their website, is also a sham.
Most, if not all, of these people don’t actually exist. For example, Michael Sterling, who is named on their website as the CEO, is not a real person. 
Image of CEO ‘Michael Sterling’ taken from the Capital40 site. There is evidence that this image is AI-generated.A Google reverse image search reveals that his photo is AI-generated, with different variations appearing online depending on the prompts.
The same face even appears on LinkedIn, this time under the name James MacGregor, listed as an Operations Specialist at Mascot Health Series Pvt. Ltd.
Another red flag is Michael Sterling’s bio, which states that he holds a degree in Computer Science and Finance from a renowned university, but does not state which university he went to or which year he graduated.
Several other team members featured on the website are also AI-generated. Alex Rodriguez, introduced as the Head of AI Development and purportedly leading the operation, is himself an AI-generated image.
It only took looking into two of them to realize that these people might not even exist. If they’re lying about the CEO and the AI developer, especially when their biggest selling point is AI integration, then there’s really no point in digging further to confirm that the rest are likely fake too. Web3, crypto, and blockchain expert Dennis Munene warns against investing in platforms where the leadership and ownership are non-existent or questionable at best.
Another major red flag in this so-called crypto business in Kiambu is the struggle investors face when trying to withdraw their own money. Just like Mary’s experience with RXM, Peter also found himself trapped in the Capital 40 scheme, and his frustrations followed a similar pattern.
Peter managed to withdraw only twice: KSh 2,560 and KSh 2,600. All his transactions were handled through a recruiter, Mercy Wanjiru Wambui, with payments made via Paybill 542 542 (I&M Bank) to account number 02407108316150.
After that, all he has been getting are excuses. He invested KSh 15,000 at first, then, encouraged by the promises and pressure in the meetings, added another KSh 30,000, a total of KSh 45,000. But when he tried to access his returns, the system suddenly had “errors,” then “glitches,” then endless “upgrades.” Each attempt to withdraw was met with a new challenge.
Then, Peter received an email from info@capital40.com demanding an additional ETF fee of KSh 10,000 before he could withdraw anything.
He paid the required fee, hoping it would unlock his money, but even then, he still couldn’t access it.
Recruiters insisted that all withdrawals had to go through their agents and often directed victims to a “crypto wallet” that supposedly converted Kenyan shillings into USD and back. On paper, Peter’s account was meant to earn him $3.42 every day. Today, the system shows a balance of $261.27, money he can see but cannot touch.
Munene notes that any genuine investment should be transparent. “When you start facing these types of problems,” he says, “that is your first sign to think twice before investing.” “When it comes to investment”, he says, “it should be very clear on what you are giving and what you’re getting. So, if there are some gray areas within the investment path that you are in. I think it’s up to you now to try to see if they are limiting or not. But for me, that’s a red flag already. I need to keep investing for me to get my returns. That’s a Red Flag. I need to get to this certain amount to withdraw my money. That’s Red Flag .”
During the meeting, as the recruiters pushed attendees to invest, they repeatedly assured them that losses were impossible. They attributed their supposed success to an AI trading bot, claiming it delivered guaranteed, consistent returns. According to them, each contract lasted just one year due to vague “AI terms and conditions.” After that, customers were required to withdraw both their capital and interest, only to immediately reinvest in a new contract, often with pressure to “compound” their profits by adding even more money.
But that couldn’t be further from the truth. No crypto investment, and certainly no AI bot, is risk-free. While trading bots can offer advantages like 24/7 trading and faster execution, they also have real risks like hacking, technical failures, manipulation, and outright scams. None of these warnings was mentioned in the forum. They also skipped over how overwhelming these systems can be, especially for people without a strong technical background. Instead, they used “AI” as a buzzword, presenting it as some omniscient force.
In an effort to stop such bad actors, the Treasury, with input from the Blockchain Association of Kenya (BAK) and the Virtual Assets Chamber of Commerce (VACC), developed the Virtual Asset Service Providers Bill, 2025. Signed into law by President Ruto on October 15, 2025, the Act will protect consumers and investors from risks associated with unregulated crypto markets. It will also combat financial crimes, including money laundering, terrorism financing, and proliferation financing, by bringing virtual assets under formal regulatory oversight.
This Act brings us to the next red flag. Part III Clause 9 of the Virtual Asset Service Providers Act, 2025, prohibits anyone from carrying out the business of virtual asset services unless they are licensed.
In this case, the registering body would be the Capital Markets Authority (CMA). However, a search for “Capital 40” among the licensees on the CMA’s official website generated zero results. Additionally, clause 20 of the Virtual Asset Service Providers Act, 2025, requires every VASP to have a registered office in Kenya. A search for the physical offices, address information, or any relevant location information connected to Capital 40 yields zero results, which is concerning, given that this is information that should be publicly available .
During the sessions, attendees were encouraged to “empower their communities” by listing the names and phone numbers of friends and family, with the list stretching beyond thirty people. At the top of the form, each person had to write their own name and indicate who had invited them. It was a deliberate tactic, designed to create a chain of familiarity that the scammers could later exploit when targeting the next round of victims, just like they did with Mary’s batch.
Munene explains that the referral model is effective in schemes like this. People tend to trust familiar faces, and scammers know it.
“On referrals”, he says, “sometimes there’s something when you put a face to it and most of us invest through our friends. Like, if my friend convinced me, I’d put money. So on referrals, and this is one of the best models for the Ponzi schemes, especially in this Global South, so they know, if I allow you to invest and I give you 10,000, you know, you invested 2,000 and you got 10,000, you will go tell a few of your friends and ask them to join you. So the referrals really work because of the social engineering aspect of it.”
The testimonials that sealed the deal
The testimonials began with the recruiters themselves, each trying to prove that they had found success through the very scheme they were now selling. Eva Wanjiku, the woman who invited Mary, shared her supposed five-year journey in online trading, claiming she discovered the opportunity in 2020 through a stranger from South Africa on Facebook. She said she borrowed KSh 45,000 to start and, within a year and three months by March 2021, allegedly made enough to buy a brand-new car in Mombasa. She even described leaving her three-month-old child behind in 2020 to “chase the opportunity.”
She assured the attendees their money would be safe because her money had never disappeared in five years. To cement her credibility, she “logged into” her trading account for everyone to see, reading out supposed daily profits that added up to USD 1,302 a week, about KSh 169,000, with a claimed monthly income of KSh 677,000.
Then came the testimonials from people claiming to be from the area, sharing how life was hard before they started investing with Capital 40. They said they’d built houses, started businesses, and could finally support their families. It was a calculated move meant to tug at people’s emotions and gain their trust. The stories they told reflected the everyday struggles of the people in the room: poverty, unstable jobs, and the desire for a better life. By using familiar faces and speaking the local language, the scammers made themselves relatable. Some of the “testifiers” even said they were teachers, farmers, and a pastor who had “finally escaped their terrible jobs.”
You must be wondering how the people in that room didn’t see the red flags. But once you understand how polished and convincing the scammers were, it starts to make sense. Imagine strangers driving into a quiet village in nice cars, speaking confidently, using complex financial and tech language most people have never heard before. It’s easy to assume they know better. Then they add pressure, “invest now or miss out,” and suddenly there’s no time for questions, no room for doubt.
That’s how many residents of Ikinu Ward got caught up in the scheme. People like Peter are still trying to understand how it happened, still trying to live with the frustration and the loss. This scam wasn’t just in Ikinu. Peter told us the same operation is active in places like Mai Mahiu, Githiga, and Machakos, a wide and well-coordinated network. They use technical terms, offer small payouts, and conceal their actions behind confusing procedures to make everything appear legitimate while quietly trapping people’s money.
Unfortunately, this is not a unique case. In 2022 alone, Kenyans lost an estimated KSh 13.2 billion to digital currency scams. A report by KICTANet, a Kenyan ICT policy think tank, warns that emerging technologies are opening doors to both new opportunities and new dangers.
Munene shares the same view. He believes that proper regulation is necessary, but it takes a while to be put in place. “The space has been growing consistently over the years”, he says, “but there is a disconnect between the population and the technology, and that’s where a lot of things go wrong in the middle.”
In situations like these, do not rush to invest in schemes that promise quick riches. Instead, take time to research, ask questions, and understand what you’re getting into. Also, these schemes thrive on urgency and the need to make quick money. Look beyond the sales pitch, and think through what could happen if you lost all the money you’re planning to invest first. The psychology of these so-called investment opportunities is to convince you that you’re guaranteed to profit, and so you lower your guard and go all in, only to lose everything. These kinds of cons are not new, it’s just the platform and currency that are different.
The novelty makes schemes like these more attractive, and the messaging may try to get you to lower your guard, but as is the case with scams like these, if the deal looks too good, think twice.
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