South Africa financial and law enforcement agencies are investigating a suspected corporate fraud case, worth up to $1.2 billion, the Financial Intelligence Center, tax authorities and Reserve Bank said in a joint statement on Sunday.

Their primary mandate is to assess the nature and validity of a range of allegations of fraud and criminality as reported during the past week, the statement said.

That could be South Africa's biggest corporate fraud which was masterminded by South Africa businessman Barry Tennenbaum, one of the founders of pharmaceuticals firm Adcock Ingram.

The Investigator Specialized Services Group (SSG) said Tennenbaum persuaded investors to plough money into a pharmaceutical ingredient import business and faked purchase orders from firms including Africa's biggest generic drug maker, Aspen.

SSG said that Tannenbaum operated this scheme through his Frankel International and Frankel Chemical Corp. companies and offered investors annual returns of up to 200 percent.

This was absolutely elaborate and was going on for about four years, said Warren Goldblatt, SSG spokesman.

It's like in the case of Madoff, the wheels have just come off, he said.

Tannenbaum now lives in Australia and said he had no intention of returning to South Africa or of selling assets to pay back investors.

Peter Winer, a lawyer representing several investors involved in the scheme, said the details of the case were still unclear, but that at least 200 people, probably many more, were involved.

He said that Tannenbaum's South African estate had been sequestrated and that authorities were probing the matter.

The Department of Trade and Industry, which is responsible for pyramid schemes, had no immediate comment but said it would look into the matter.