A pre-empted civil suit expected to be brought before the Polokwane High Court within due course and a re-launched criminal investigation following three years of extensive probing are attracting attention to an apparent liquidation matter reportedly involving a prominent Limpopo lawyer.
It was reliably learnt that the Tzaneen-based lawyer has reportedly been at the centre of a protracted investigation into alleged fraud through his firm’s trust account stemming from a Black Economic Empowerment (BEE) buy-out entered into in the beginning of April 2011, when he purchased an engineering concern in Phalaborwa with a Polokwane-based business partner. The lawyer, who reportedly served in the position of managing director of the company, allegedly also acted as conveyancer during the transaction as set out in available documentation.
Polokwane Observer was informed that the civil matter is expected to be instituted by a Polokwane attorney and senior counsel in Sandton on behalf of the former owner of the engineering business as well as the family of the lawyer’s deceased partner within a matter of days. The lawyer’s business partner reportedly passed away on 4 February 2013.
It was claimed that the seller had lost his business of 30 years and all his equipment in the process while a glaring absence of claims on behalf of the former business partner would seemingly exist.
In a telephonic interview KwaZulu-Natal-based private investigator Eugene Engelbrecht informed Polokwane Observer that he was approached by the former owner of the business in February 2015 to probe several leads pointing to alleged fraud that led to a criminal case being registered with the Police in Tzaneen in May 2013. The docket in the case that was re-activated on 24 August last year had in the meantime been transferred to Polokwane, he said and added that the matter was currently with the Director of Public Prosecutions in Limpopo, as attested to in a letter dated 18 December 2017 and directed to the family of the deceased business partner upon their enquiry into the investigation on 9 October last year. At the time of going to press National Prosecuting Authority Limpopo spokesperson Mashudu Malabi-Dzhangi said the Deputy-Director of the NPA in Limpopo was still going throught the docket and that no decision has been taken as yet. Also no arrest has been made thus far, she confirmed.
Engelbrecht informed Polokwane Observer that the ensuing civil suit was expected to challenge the potential loss of R60 million relating to the transaction.
He referred to documentation made available to Polokwane Observer reflecting that an attorney in Pretoria was prepared to accept the appointment as business rescue practitioner of the ailing company on 15 October 2012. In a circular issued to all affected persons and dated 14 November 2012 he mentioned his appointment on 19 October 2012. In the document he indicated that based on several undertakings he had decided not to bring an application for liquidation as it might well be possible that the company could be rescued subject to such undertakings. He further wrote that the business rescue plan was due on 23 November 2012 and that he undertook not to bring liquidation proceedings prior to that date, when he envisaged to publish a realistic business rescue plan.
However, in a circular of 23 November 2012 the attorney and business rescue practitioner said that despite numerous undertakings by the pre-rescue management to provide him with sufficient funding to pay all employees in full and to provide him with sufficient information to produce a realistic business rescue plan, nothing had been forthcoming and that he had therefore launched an application for the liquidation of the company as duty bound in terms of s141(2)(a)(ii) of the Companies Act, 71 of 2008.
Engelbrecht further stated in a summary of the case furnished to Polokwane Observer that once the business had gone down it had resulted in the loss of jobs of the staff component at the time of liquidation. Claiming little less than a handful anomalies pertaining to the matter, Engelbrecht pointed out a discrepancy of a contingent of an argued 175 staff members having been listed in the liquidation and distribution account as only 114, leaving the rest out of the scenario. According to Engelbrecht more than 100 former employees working for the company from 4 April 2011 to 21 November 2012 were currently signing affidavits to be included in the court documents in the civil case to be lodged. In addition to that the alleged failed payment of contributions to the South African Revenue Services (SARS), the Labour Department and provident and medical aid funds reportedly deducted from staff salaries was probed, he said.
At the same time he queried receipt of the second and final liquidation and distribution account of the company last Monday, while attached affidavits are seemingly respectively dated 22 February, 2 March and 8 March last year. Copies of the documentation were also made available to Polokwane Observer, including the final liquidation order of 27 November 2017.
Hawks spokesperson Hangwani Mulaudzi was approached for feedback on the status of another criminal matter reportedly instituted against the lawyer from Tzaneen in April 2015. Information is still awaited.
Story: YOLANDE NEL
>>observer.yolande@gmail.com
