Tongaat Hulett's R118m fine for misrepresentation reduced to R20m
The Financial Sector Conduct Authority (FSCA) has imposed a fine of R118m on agriculture and agri-processing business Tongaat Hulett for misrepresenting its financial performance.
However, the authority considered Tongaat's application for the remission of the fine and reduced it to R20m, inclusive of investigation costs.
“The authority agreed to the remission of the penalty more to avoid further penalising innocent shareholders,” it said in its order.
It said the errors took place over the past six years and the cumulative reaction has been reflected in the March 31 2017 financial statements. The authority found that Tongaat made false, misleading or deceptive statements, promises or forecasts in its public statements to the markets in that period.
It said the current Tongaat management gave full co-operation during the investigation and enforcement process and accepted that the company had contravened the Financial Markets Act.
The FSCA said Tongaat also undertook to put measures in place to ensure that the company mitigates the risk of similar contraventions occurring in the future. It said the size of the headline penalty of R118m reflected the scale and severity of the regulatory breach.
“Nonetheless, considering Tongaat’s current financial position, we have made the decision to remit a substantial proportion of the penalty,” added the authority.