Brusson under fire from investors, banks

It has been a week since the Brusson Finance scheme, stitched together by well-heeled estate agents, started to unravel. Hundreds of poor people were swindled out of their homes, which they were duped into offering as security to obtain cash. The four big banks have launched their own investigations, while denying that they share part of the blame. Now, more victims are emerging, write Rob Rose, Stephan Hofstätter and Charl du Plessis

Tshepo Motsisi, a 34-year-old single mother, blames Brusson Finance for the loss of her unborn twins.

Motsisi, along with about 900 other blacklisted homeowners short of cash, was sucked in by Brusson's offer of a "second chance". But instead of getting a R40000 loan so that she could pay off her R122000 bond, Motsisi ended up signing over her house to one of Brusson's "investors" - in exchange for far less than R40000.

Her monthly repayments increased but Motsisi could not meet them. In January, Brusson told the 18-weeks-pregnant office worker that she was to be evicted and the house sold.

"I stayed three days in hospital, before I miscarried because of stress," she said. Her story is far from uncommon.

In the wake of a judgment in the Bloemfontein High Court last week, which ruled Brusson's scheme "unlawful", scores of victims have emerged, claiming that they too have lost their houses or faced eviction because of the scheme.

Many of them are refusing to leave their home, claiming they were conned by Brusson.

Even Brusson's "investors", who were paid a "passive income" to allow Brusson to apply to banks in their name, are now calling foul.

There were two sides to every deal. Brusson's clients "borrowed" cash on the security of their house.

The money lent them came from "investors" with a clean credit record who applied for a bank mortgage on the client's house.

The client then paid a monthly instalment to Brusson - part of it going to the investor as "passive income" and part to Brusson for acting as "surety".

Many are now asking why it took the National Credit Regulator four years to act since it first received complaints about Brusson, a company established by estate agent Ian Lockyer and former butcher Mike Basson in 2005.

At a meeting with The Times last week, Lockyer said the National Credit Regulator had "no problem" with the scheme when one of its officials first arrived at their offices in 2006.

"If our system was doing what the [regulator] says it was, why didn't they do something in 2006?" he asked.

But Jan Augustyn, the National Credit Regulator's head of investigations, said it is not true that the regulator sat on its hands and gave Brusson free rein.

"It's a complicated investigation . and [Brusson] delayed the process," he said.

Consultant swore in Jesus' name

NTHABISENG MOTAPANE - an 'investor'

MOTAPANE, a personal assistant, and her husband, Elias, received a proposal late last year that played on their religious beliefs.

They thought it was a good investment opportunity because they wanted to purchase their own home to live in with their three-year-old son, Kamoghelo.

[A Brusson representative, Carmen Pretorius,] said to me in her own words: 'I'm a Christian as well. If this were bad I wouldn't be doing it'," said Motapane.

The couple signed what they thought was surety for a home in Eastern Cape.

After only two payments, the couple were told that "the home owner is not paying [Brusson] and that the company was going down," said Motapane.

'I was bullied into taking a loan'

CHARLES SAPHEKGE - 'client'

SAPHEKGE said he was bullied into taking a loan from Brusson Finance in 2008.

Saphekge said that Brusson was very co-operative at first, promising him that the company would "assist" him with his debt to the municipality and renovations to his home.

"I said to the woman [from Brusson] that my house had been paid up, I only had problems with the municipality" said Saphekge.

It was only after Saphekge refused to sign contracts sent to him that Brusson turned nasty.

"The woman started telling me that if I didn't sign them I would be fined about R5000."

He was surprised when Brusson did not deduct a second payment from his account, and realised that he had sold his house only when he received an eviction letter saying he owed an investor R13000.

Brent: Scam cost me R70000

BRENT SLABBERT - an 'investor'

Slabbert, 36, who claims to be one of Brusson's "very first investors," was told by the company that "there would be no risk whatsoever for us as investors".

Brusson took out six bonds from banks on his behalf in 2008.

Initially, everything went according to plan but, in April, he started receiving phone calls from the banks telling him that he was in arrears.

Slabbert said he found out that "the tenants in his properties were paying rent, but Brusson wasn't paying the bonds".

Slabbert, who is self-employed, is now R13000 in arrears but said that the scam has cost him as much as R70000.

He has taken charge of the properties and is receiving rent direct from the tenants, but still worries that the banks might evict them and sell the houses.

'Brusson took advantage of us'

KISHORE RAMPARSAD - 'client'

Ramparsad "borrowed" R120000 from Brusson against his R650000 house, but received only R68225. Within three months, Brusson sent him an eviction notice.

"[I] strongly feel that this institution takes [advantage] of people that are vulnerable and desperate," he said.

Mantsho Mabote got a R35000 loan from Brusson, repayable over three years, using his house as security. After missing a payment, Brusson served him with an eviction notice, telling him his house was now registered to a Mr S Moulder.

He had to quit his job to access his pension fund so that he could pay R97000 to Brusson in December 2007.

Another client, Isaac Banda, borrowed R24500 against his house from Brusson but was told he had to pay R282000 to get his house back.