Pyramid of fraud was built on bling, boats and booze

The fugitive lawyer at the centre of the country's biggest Ponzi scandal once splurged R300000 on French champagne for his guests to spray each other with while holidaying aboard a luxury multimillion-rand yacht.

Dean Rees, 40, who has fled to Switzerland with his family, is one of five people wanted by local authorities in connection with the scheme that left 800 wealthy investors out of pocket to the tune of R13-billion when it crashed in 2009.

The scheme was allegedly set up by businessman Barry Tannenbaum, who has since fled to Australia.

Investors, including well-known corporate moguls like former Pick n Pay CEO Sean Summers, thought they were investing in a pharmaceutical business but were left short-changed.

An affidavit spells out how Rees lived the high life - apparently on his ill-gotten gains.

The affidavit by a former investor - who asked not to be named as he is a potential witness - details the lengths to which Rees went to impress the country's super-rich and persuade them to part with their money. It says he:

• Spent around R5-million at a jewellery store on watches for himself and bling for his wife, Dominique;
• Sent limousines to pick up friends and investors for dinner parties through luxury concierge service Quintessentially;
• Flew his personal jeweller to St Tropez on the French Riviera to deliver a five-carat diamond ring worth R1.7-million for Dominique;
• Paid R500000 a day to hire a luxury yacht to entertain potential investors;
• Forked out R5000 a bottle on French wine for each of his guests; and
• Together with his wife regularly splurged on limited edition watches and designer sunglasses.

"He was clearly what I would call a fast talker, very good in selling ideas, and clearly someone who was flashy in his lifestyle," the affidavit says. "I would even describe it as excessive."

The document spells out how, on a trip to St Tropez in France during September 2008, and less than a year before the scheme came crashing down, Rees hired the yacht Tommy for a birthday bash for his wife. He also invited potential investors.

"All expenses were paid by Rees ... he arranged and paid for charter helicopter transport from the Nice airport.

"The sheer size and luxury of the yacht proverbially overwhelmed me," said the investor.

The 52m yacht boasts four bedrooms, a Jacuzzi, helicopter landing pad and full communication facilities.

Said the investor: "The spending spree was breathtaking ... they (Rees and his wife) ended up at a table in a restaurant which was attended by visitors to a yacht which was moored next to the Tommy yacht.

"During supper the two tables started spraying each other with expensive French champagne ... Rees footed the bill for the champagne spraying of approximately R300000."

Among those at the table were investors Philip Green and Richard Kirk and his brother Andy, all wealthy British businessmen. The affidavit claims the Kirk family lost £17-million in the scheme.

At another dinner in Johannesburg three months later, Rees allegedly bragged to guests about having bought a villa in Lausanne, Switzerland, worth R65-million.

An investigator told the Sunday Times this week that Rees continues his high-flying lifestyle in Switzerland by driving around in a McLaren Mercedes sportscar.

When Rees left South Africa shortly after the Ponzi scheme collapsed, he chartered a private jet for more than R1-million and left with jewellery and watches - including one Blue Phantom watch valued at R1-million alone.

An member of the joint task team investigating Rees, Tannenbaum, and Tannenbaum's wife Deborah, said: "We are wrapping up the finer details and hope to get them back to South Africa soon to face the music."

A Ferrari 599 that belonged to Rees was this month auctioned by the Asset Forfeiture Unit.

Hawks spokesman Colonel McIntosh Polela confirmed arrest warrants have been issued for Rees and his wife and that there will be moves to extradite them to South Africa to stand trial.