Probable irregularities in appointing liquidators uncovered in South Africa — TimesLIVE
South Africa’s Special Investigating Unit (SIU) has identified signs of probable systemic irregularities in the appointment of liquidators for insolvent companies. According to TimesLIVE, the investigation concerns possible interference by officials from masters’ offices, liquidators and insolvency practitioners in the allocation of lucrative cases.
The SIU reviewed 273 cases, identified violations in 28 of them and referred 47 criminal matters to South Africa’s National Prosecuting Authority (NPA). Investigators reported evidence of possible fraud, corruption, bribery, document forgery and other alleged crimes that, according to the unit, may have been committed by officials, liquidators, lawyers and private individuals.
Interference in appointments
Former acting chief master Teresia Bezuidenhout was at the center of the SIU’s findings. The unit concluded that she improperly interfered in at least two important liquidator appointments.
In particular, in the Bosasa liquidation case, Bezuidenhout, according to the SIU, convened officials from different masters’ offices and instructed them to appoint Cloete Murray as provisional liquidator. The report states that these officials had no jurisdiction to make such a decision and that Bezuidenhout herself was not authorized to appoint or nominate an insolvency practitioner.
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In another case involving Duro Pressings, the SIU said that Johannesburg deputy master Reuben Maphaha appointed Gert Lourens Steyn de Wet of Kaap-Vaal Trust and Johan Engelbrecht of Icon Insolvency Practitioners as additional liquidators. The incumbent liquidators challenged these appointments in court, which set them aside and removed de Wet and Engelbrecht from the case.
Suspicions over creditors’ claims
The SIU also said that two Kaap-Vaal Trust directors — de Wet and Olga Kotze — together with Mandla Madlala may have created forged documents and inflated creditors’ claims by about 345 million rand in order to secure Kotze’s appointment as provisional liquidator. According to the unit’s findings, the evidence points to possible document fraud intended to influence the allocation of liquidation cases.
Separately, investigators examined a payment of 3,000 rand that Kaap-Vaal Trust employee Aubrey Moitjiwa allegedly made to former assistant master William Sekete. The SIU suggested that the funds may have been intended to influence appointments in cases involving the firm. The unit also reported possible corrupt links between Engelbrecht and Sekete that may have influenced liquidator appointments.
Justice and Constitutional Development Minister Mamoloko Kubayi said that the department held disciplinary hearings concerning two employees. One of them was dismissed but was later reinstated by a decision of the Commission for Conciliation, Mediation and Arbitration. Other matters were referred to the Hawks priority crimes unit for further investigation.
