Fidentia placed under final curatorship

The company was placed under provisional curatorship at the beginning of last month, after a Financial Services Board (FSB) probe reported alleged misappropriation of hundreds of millions of rands. ‘The curatorship order is made final now, which means we can act more decisively and get on with the process of establishing where the assets are,’ joint curator Dines Gihwala said. ‘It\'s quite complicated. In terms of our preliminary findings there are any number of assets which seem to be in the names of other entities, and we still have to connect that, and there may be a fight in terms of who really owns what, and where the money came from.\' Yesterday’s ruling by Judge Burton Fourie was not opposed by Fidentia. Counsel for the FSB Ashley Binns-Ward said ‘matters have been sorted out directly with the curators\'. Full report on the IoL site

In their report submitted to court, the curators said investors would face an estimated shortfall of about R1bn once Fidentia’s affairs had been sorted out, according to a report in The Citizen. ‘Since assuming control and management of the business the curators have established a multiplicity of wrongdoings, both of a criminal and civil nature, on the part of directors and shareholders and other closely associated individuals and entities,’ the curators say in their report. They directly accuse Fidentia boss J Arthur Brown and company accountant Graham Maddock of theft, detailing how Brown allegedly stashed millions in what was supposed to be investors’ assets in his private bank account. Full report in The Citizen

The 14-page report revealed how Brown stashed R13m in company funds in his private bank account, and as curatorship loomed, used R5.5m in investors\' money to pay staff salaries. The curators also say it appears that substantial sums of money have been paid by Fidentia to third parties, apparently for assets purchased, according to a report on the Finance24 site. ‘Nevertheless no record of such assets has been found yet,’ they say. ‘At this stage there is a strong suspicion that assets have been either concealed or registered in the name(s) of others to the detriment and prejudice of investors of FAM (Fidentia Asset Management).’ They confirm that a R150m promissory note issued by PLJ Corporate Finance Namibia was ‘completely valueless’, and say it appears that the note was introduced into FAM\'s books ‘in order to conceal the loss of investors\' funds’. Full report on Finance24 site

Details have emerged about how a corrupt Absa employee helped launder many millions of rands allegedly belonging to clients of Fidentia, Ovation and Common Cents have come to the fore in court documents, says a report on the Moneyweb site. According to the papers, filed in support of the sequestration of the estate of former Milkworx chairperson Angus Cruickshank this week, the investigations of curators of Fidentia say they believe a former employee was bribed to help launder R219m through three Absa accounts in the second half of 2005. Full report on the Moneyweb site