Ponzi millions huge boost to state coffers

04 November 2013 - 02:03 By SIPHO MASOMBUKA
subscribe Just R20 for the first month. Support independent journalism by subscribing to our digital news package.
Subscribe now
Jeff Radebe. File photo.
Jeff Radebe. File photo.
Image: SIBONGILE NGALWA/GCIS

Money from the multibillion-rand Barry Tannenbaum Ponzi scheme made up most of the R82-million deposited in the state's criminal assets recovery account.

Justice Minister Jeff Radebe said in Pretoria yesterday that the R54-million seized by the National Prosecuting Authority's asset forfeiture unit from the huge Ponzi scheme set up by businessman Tannenbaum resulted in the surpassing of the unit's R55-million target.

The scheme left 800 wealthy investors, including former Pick n Pay CEO Sean Summers, out of pocket to the tune of R13-billion when it crashed in 2009.

Tannenbaum fled to Switzerland.

"In the first six months of the 2013-2014 [financial year], the asset forfeiture unit of the NPA had exceptional success in taking the profit out of crime ... in this regard R82-million in cash was paid into the criminal assets recovery account - R17-million more than in any previous full year," Radebe said.

Radebe said the money seized from the Tannenbaum scheme was the most to have been paid into the account.

He said R1.5-million was returned to 5000 Khayelitsha victims of Cape Town businessman Mzwandile Pato's pyramid scheme.

Last year Pato pleaded guilty to 5601 counts of fraud, 999 counts of money-laundering, and to contravening the Financial Advisory and Intermediary Act and the Banks Act. He was fined R200000.

Radebe said R2.7-million was returned to foreign investors defrauded by Pretoria's Jacobus Janse van Vuuren.

Radebe said R6.3-million was seized from three drug dealers, and R6.6-million from rhino poachers and an abalone smuggler.

From tax rebel Dave King the account received R8.75-million. In August, King agreed to pay SARS R706.7-million to settle his tax debt. He was found guilty on 41 counts of contravening the Income Tax Act.

Three KwaZulu-Natal farms valued at R52-million that had been fraudulently transferred were forfeited to the state, he said.

Radebe said that by the end of June 522 allegations of serious corruption had been recorded and 791 people were currently under criminal, financial or forensic investigation.

subscribe Just R20 for the first month. Support independent journalism by subscribing to our digital news package.
Subscribe now