Africa-Press – Eswatini. IN what will be received as good news for troubled Ecsponent investors, the High Court yesterday ruled in their favour as it directed the Financial Services Regulatory Authority (FSRA), Ecsponent SA, Dave Van Niekerk and others to pay back over E335 million.
This comes as the over 1 138 investors who consist of pensioners, non-governmental organisations, churches and retired members of the public had invested varying amounts of money to Ecsponent Eswatini since 2014.
The money is reported to have accumulated to E431 million when it was discovered missing, but the sum was reduced to E406 million after the company which took over, ESW Investment Group, (ESWIG), had paid other investors.
The court order which was issued by Judge Khontaphi Manzini, was made at the High Court (Commercial Court Division).
The applicants in the matter were ESW Investment Group (Pty) Ltd (formerly known as Ecsponent Swaziland Pty Ltd). Other cited parties in the matter consisted of the FSRA, Ecsponent Limited SA, GetBucks Limited SA, Dave Van Niekerk, Edwin Soonius, former FSRA CEO Sandile Dlamini, Lindiwe Vilakati and Anthony Hay who were the first to eight respondents, respectively.
Before the court reached the ruling, the applicants sought to recover E335 240 000 which was invested in Ecsponent Swaziland by the second applicant, being the investors.
The applicants essentially sought a return of the invested sums, which were transferred under the directorship and through the instructions of first to fifth respondents.
According to Max Bonginkosi Mkhonza’s founding affidavit, FSRA through Edwin Soonius who was acting within the scope of his duties as its Chief Executive Officer at the relevant time and the other defendants, conspired and/or acted with a common purpose to implement and implemented a fraudulent scheme to unlawfully expatriate funds invested by the local investors in an investment scheme operated by FSRA, as a financial services provider.
The money was then invested in South Africa with the intention to use the expatriated invested funds for their own purposes, contrary to the purpose set out in the approved relevant prospectus and which they had presented to the investors.
In terms of the relevant prospectus, for each period of investment, the funds could only be invested in a ‘secured environment through linked preference shares in the share capital of Ecsponent SA for investors to obtain higher returns that are normally available while marking capital available to businesses that need the funds for growth.’
In terms of the fraudulent scheme, the defendants in the main proceedings, including the respondents in the interlocutory application, did not invest the funds as per the relevant prospectus in a secured environment.
Resultant to the aforementioned millions, the funds later became unrecoverable by virtue of the unlawful expatriation and unlawful use thereof, despite investors being promised high returns on their original investments.
The applicants (investors) further sought a return on their investments from the defendants jointly and severally with FSRA, Sandile Dlamini and Lindiwe Vilakati in the main application and essentially grounded its claim on the unlawful misrepresentation made by the respondents in the application.
Judge Manzini said having heard counsel for the plaintiff, she had granted the judgment in favour of the plaintiffs. The judge ordered that the second, third, fourth, fifth and eight defendants pay the sum of E335 240 000 to the plaintiffs. He also ordered that the second, third, fourth, fifth and eight defendants pay interest on the said amount from 2020 to date of payment of plaintiffs.
Meanwhile, the second, third, fourth, fifth and eight defendants are to pay costs of suit to the plaintiffs.
The judge further ordered that the default judgment be published on Eswatini’s local news daily publications and further be published in a South African newspaper both in the Gauteng Province and nationally.
Furthermore, the respondents were afforded a period of seven days after the service of summons to enter an appearance to defend the action with the registrar of court and the applicant’s attorney.
In addition to this, other individuals invested amounts totalling E2.1 million , E1 8 million, E1 2 million each, with the lowest amount invested being a little over E10 000.
Some investors were:
n United Life Assurance Ltd E7.1 million
n University of Eswatini E5.9 million
n Yetfu Sonkhe Savings and Credit Co-operative E1 000 000
n Likhwane Beneficiary Services E2.7 million
n Sicamelo Savings and Credit Co-operative E2.584 million.
n Esibayeni Enterprises E35 million
n Fairlife Beneficiary Fund E3.5 million
n These amounts totalled E406 932 005.55.
Source: times
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