One-time billionaire Markus Jooste claims lack of income as he skips court again

Once one of the richest men in South Africa, reportedly worth billions, former Steinhoff CEO Markus Jooste has pleaded unemployment and a lack of income during proceedings at the Pretoria offices of the Financial Services Tribunal.

Jooste failed to attend the proceedings on Tuesday, leaving it to his legal team to argue against a reduced R20 million administrative penalty for insider trading.

In 2014 Forbes estimated his fortune at $400m (R5.7bn at the time). Five years later, and two after an accounting scandal that shook the international business world, Financial Mail reported Steinhoff claimed R870m from Markus Jooste for “unjustified enrichment”. Daily Maverick reported in 2022 the Western Cape High Court granted the SA Reserve Bank an urgent order to attach Jooste’s assets worth at least R1.4 bn.

Jooste, who resigned from his position in late 2017 amidst the accounting scandal, had previously been fined R162 million by the Financial Sector Conduct Authority (FSCA) for insider trading.

ALSO READ: High Court setback for disgraced former Steinhoff CEO Markus Jooste

However, in December, the Financial Services Tribunal reduced the penalty by 90%, leading to Jooste’s recent legal dispute.

“What he [Jooste] said was that I have been without work for the last six years since I lost my work at Steinhoff, and who is going to employ me?” Jooste’s senior counsel Francois Van Zyl, SC, told News24.

In court, Van Zyl claimed Jooste did not use inside knowledge to conduct his own trades and so did not gain from alleged insider trading in Steinhoff stock.

Insider trading allegations

Jooste is already facing a warrant of arrest in Germany for his alleged involvement in the massive accounting scandal.

Jooste’s legal predicament stems from allegations of insider trading related to his tenure as the CEO of Steinhoff International Holdings. In October 2020, the FSCA imposed a staggering R162 million fine on Jooste for sending a text message to four of his friends, advising them to divest their Steinhoff stocks urgently.

The message was perceived as confidential information and a blatant case of insider trading.

Financial services tribunal’s decision

Despite Jooste’s initial fine, the Financial Services Tribunal handed down a surprising decision in December. They reduced his penalty by 90%, effectively reducing it to R20 million.

The tribunal’s rationale was that Jooste had not disclosed “precise” inside information to his friends, but they still upheld the ruling that he had engaged in insider trading by encouraging his associates to sell their Steinhoff shares.

ALSO READ: Steinhoff’s Markus Jooste couldn’t find his passport – misses German court date

In Germany

Jooste’s legal challenges are not confined to South Africa alone. In July, the Higher Regional Court of Oldenburg in Germany rejected his challenge against an arrest warrant issued in connection with the accounting scandal.

German authorities have been working on an extradition request to bring Jooste from South Africa to face charges in Germany.

Jooste’s former colleague, Dirk Schreiber, the former European finance chief of the company, received a three-and-a-half-year jail sentence from the same German court in August. This marked the first imprisonment related to the accounting scandal that nearly caused the retailer to collapse.