Africa-Press – Eswatini. The prolonged delay in the institution of the forensic audit into the alleged embezzlement of about E431.1 million invested with Ecsponent Eswatini Limited is delaying justice for the victims.
The situation is said to have left every side in limbo, including the company that inherited the debt and the investors who lost huge sums of money in the alleged investment scam.
Despite the setback, management of the company which took over continues to lobby for the launch of the forensic investigation.
This is because the process is considered crucial for the recovery of the lost money and bringing the culprits to book.
This was disclosed in a statement issued by the ESW Investment Group (ESWIG) yesterday.
In the statement it was explained that the company has maintained efforts aimed at supporting government in its quest to uncover the truth relating to the activities of the suspected pyramid scheme.
It is the strong belief of the company management that the recovery process could be stronger when led by the state.
Regardless of the delay, the company stated that it still has confidence in parliament and government’s commitment to seeing the process through.
“In addition, our partners at shareholder level in ESWIG are continuing to monitor the ongoing liquidation process in RSA (the Republic of South Africa) on companies related to Ecsponent like VSS Capital. Progress remains slow.
These processes will continue to be monitored, including all related litigation playing out in the RSA and other jurisdictions that Ecsponent operated in,” read the statement in part.
Through the statement, investors or victims of the scam were assured that a firm foundation had been laid, particularly regarding the restructuring and rebuilding process of ESWIG. Such processes included the acquisition of shares in micro-lending company Getbacks Eswatini, where the company is also eyeing buying out the current major shareholders completely as a measure to expand its income base.
Throwing some light into the turnaround strategy was ESWIG Chief Executive Officer Max Mkhonza. He explained that the investment in the micro-lending business was promising, and there was a huge potential for growth, which could assist step up the process of finally liquidating the Ecsponent or ESW liability.
“The progress made thus far bodes well for the accelerated implementation of efforts to generate cash to be used in liquidating Ecsponent or ESW liability.
“Much work, however, still needs to be done. A strong management team as well as governance oversight structures have been put in place to ensure that accelerated progress continues,” he said.
Ecsponent Eswatini Limited invaded the financial services space in the country in 2013 and managed to sway about 1 500 gullible Emaswati to invest with them, with what later turned out to have been pseudo promises to reap huge financial rewards.
It transpired that at the time the victims had not taken enough time to familiarise themselves with Ecsponent prospectus.
The prospectus in part spells out what the company is about, its directors and importantly, what risk factors associated with investing with them were.
Amongst many clauses contained in the Prospectus 2014 which investors were supposed to re-read overtime so as to comprehend implications of same before signing anything with Ecsponent Eswatini Limited was Annexure 3 point 11 which stipulated that “I/We acknowledge that we are aware that the linked loan units on offer are unlisted and not readily marketable and that interest, dividends and capital are not guaranteed.”
Another version is that the 1 500 investors when approached to invest in Ecsponent Eswatini Limited were not handed the ‘Prospectus 2014’ for them to read, understand and take a decision.
It seemed the investors were only given quotations and some documents to sign.
Not the Prospectus 2014 which has a couple of clauses that addresses the issues of risks,” Mkhonza said during a presentation at ESWIG offices yesterday.
So, Ecsponent Eswatini Limited may have sold its products to the 1 500 investors under false pretences, leading to the eventual loss of about E360 million which had been invested with the company.
All the money is believed to have made its way out of the country, causing untold misery to the victims.
Management of the company that took over reportedly took time to understand the nature of the issues that led to the unfortunate situation.
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