Didata boss was 'winner' in fraud scheme

E-mails and spreadsheets in the possession of Business Times suggest that Ord was one of the few "winners" in the scheme, making money from it and quitting while he was ahead.

This contradicts Ord's earlier statements denying any involvement. When first contacted about the matter in June last year, he said: "I'm not an investor (but) I know some people (who invested)".

When contacted again in November, he sent an SMS saying claims of his investment in the scheme were "factually incorrect".

However, e-mails between investors and Dean Rees, a lawyer who acted as an agent for investors in Tannenbaum's scheme, confirm Ord's involvement.

In one e-mail in March 2008, sent from his Dimension Data e-mail address to Rees, Ord said: "I haven't heard anything from you with regard to my latest investment ... I understood payment was due last week, and that we would be receiving 2% extra interest per week. What is the status, when are we going to get paid?"

In another e-mail in August 2008, Rees wrote to Ord confirming that for one specific deal, he put in R10-million in capital and had already been paid R7.5-million.

Ord replied from his Dimension Data e-mail address: "Does this mean the 6 (R6m) outstanding will be repaid by tomorrow? Regards Jeremy."

It is understood that Ord did not meet Tannenbaum or Rees, but rather dealt with his investments mostly on email.

Sources close to the probe into the Tannenbaum scheme confirm Ord "cashed-out" before the scheme was exposed as a scam, being paid returns of more than 40%.

When Business Times contacted Ord in recent days to ask why he had denied involvement when he clearly was involved, he refused to return calls or SMSes.

It is unclear whether "winners" who made money will be asked to repay their profits.

The liquidators of Tannenbaum's estate, who must decide this, have gone quiet in recent weeks.

Evidence emerged this week that Tannenbaum ran a "furniture investment" scheme in 2005 that was very similar to the "medical ingredients scheme" that later sucked in the likes of Ord and former Pick n Pay boss Sean Summers.

Business Times is in possession of e-mails that Tannenbaum sent to investors, ostensibly to show them that his brother, Mike Tannenbaum, was helping organise "furniture investments" in London - which wealthy South Africans would finance in exchange for a profit.

This was eerily similar to Tannenbaum's later scheme in which wealthy individuals financed the purchase of "medical ingredients", which were then supposedly on-sold to companies like Aspen and Novartis for a huge profit.

The e-mails, dating back to 2005, appear to show that Mike Tannenbaum - financial director of the London Stock Exchange-listed Westcity plc - was closely involved in the furniture scheme.

However, when contacted this week, Mike Tannenbaum said the "e-mails relating to furniture transactions purportedly from me have been fabricated".

He said the e-mail address - which varies from miket@westcity to miketan@westcity - "does not match any e-mail address I use or have used in the past".

"I have never heard about these transactions before, much less been involved in them," he added.

Though Rees was not involved in the furniture scheme - he only met Tannenbaum in late 2006 - another lawyer at the centre of the storm, Darryl Leigh, did invest in the furniture scheme. It seems Leigh later introduced Rees to Tannenbaum.

The e-mails supposedly containing Mike Tannenbaum's offer to invest in furniture appear to have been forwarded to Leigh by Barry Tannenbaum.

In one e-mail on June 28 2005, Barry Tannenbaum forwarded a message to Leigh, supposedly from his brother, proposing a furniture deal and referring to Barry affectionately as "Poochie".

"The sea freight deal ... commences August 23 2005 and will run through to October 28 2005. The rate will be 30% and I have arranged a quota for you for R8.5m. I will try and do better for you but will only be able to let you know closer (to) the time," he allegedly wrote.

On another deal, which matured in July that year, Mike supposedly wrote that "Steve and his team need more furniture to complete Clock B in the Trussards" and R3.5-million would allow Barry to "buy in" to the scheme. "The length of the deal will last 4 weeks to August 12 2005 (and) I can get a good return for you for this period at 35%," the e-mail said.

On November 7 2005, Barry Tannenbaum wrote to Leigh about the profit on such a deal being about 12.5%. "I did agree in principle, but should you want the R2.1m by the 15th November, my brother can arrange it," he said.

On October 26 2005, Barry wrote to Leigh about a R20.2-million deal: "the very good news as a result of the strengthening of the British pound against the SA rand is that we are able to get 35% on this deal. The bad news is that this appears to be the last deal for South Africa. It seems the potential suppliers in the east are promising good service."

When asked who he believed forged these e-mails and for what purpose, Mike Tannenbaum said, "I don't want to speculate".

The medical investment scheme, which forms the core of the current fraud probe, took off in 2005. In October, finance minister Pravin Gordhan said more than R12.5-billion was involved.