Serial looters unmasked

South Africans David ‘Dave’ Van Niekerk, Edwin Soonius, Marthinus Prinsloo, Michael Hodgkiss and Claude Scholtz have been named as individuals who have allegedly been behind some companies that have resulted in emaSwati losing millions.

By Staff Writer

Individuals who made off with over E300 million from emaSwati have struck again as investors in a new entity have been left with the realisation that E82 million of their money has disappeared.

Investigations by the Eswatini Financial Times have lifted the lid on how Status Capital Building Society, which has been in the headlines over the disappearance of millions from investors, is run by the same people behind the infamous Ecsponent Eswatini Limited through which thousands of emaSwati lost over E340 million of their investments.

According to company registration records filed with the Registrar of Companies which Eswatini Financial Times has seen, one of the founders of Ecsponent Eswatini Limited was Dave Van Niekerk, the very same person who is a Director at Status Capital Building Society. Most recently, Van Niekerk was named in court papers in the matter between Status Capital and Swaziland Debt Factoring Firm. It was submitted that on July 1, 2020, in Ezulwini, Status Capital, represented by Van Niekerk who is popularly known as DVN and Claude Scholtz, in their official capacities, entered into a written debentures agreement with Marthinus Prinsloo, who represented the Swaziland Debt Factoring Firm, for an investment amount of E67 293 700.

The money was to be invested in the financial services company. However, the amount was said to be now over E82 million because of arrears. Despite demand, Swaziland Debt Factoring Firm refused to make a payment or cede the security as provided for in the debentures agreement and cession agreement. In terms of the agreement, Swaziland Debt Factoring Firm became the issuer, while Status Capital was the investor. The intention was that the two entities form a lending partnership.

Allegations are that over E82 million invested through Status Capital Building Society was diverted out of the country without authorisation, by Swaziland Debt Factoring Firm. Status Capital was granted an interim order interdicting and restraining Swaziland Debt Financing Firm from transacting, making and transferring any payment from its bank accounts held with First National Bank (FNB). Outstandingly, Van Niekerk was the Chief Executive Officer at MyBucks, the company in which the Ecsponent money was invested. He was also one of the founders of Ecsponent.

According to a forensic audit conducted in 2020 by MHMK Group which acquired both Ecsponent Eswatini and Ecsponent South Africa found that in June 2018, GetBucks Eswatini borrowed about E171 million from Ecsponent, of which about E53 million was used to build a loan book in Eswatini and the balance of approximately E118 million was on-lent to their sister company in South Africa, GetBucks South Africa. Due to the non-servicing of interest and principal, the amount due from GetBucks Eswatini to Ecsponent grew to more than E360 million.

Van Niekerk left MyBucks on March 13, 2019, when changes were made to the Board of MyBucks South Africa. According to BusinessLive, Van Niekerk was also the prime mover of a controversial microlending group Blue Financial Services (BFS). There appear to be some parallels between BFS and MyBucks. Van Niekerk left BFS under a cloud after the company racked up losses of more than E1 billion in 2009, which prompted an urgent E463m recapitalisation of the company by a private equity firm. A struggling BFS was suspended from the JSE in 2013, and the listing was later terminated.

Our investigations show that Prinsloo, a director at Swaziland Debt Factoring Firm was also a Sole Director of Barisa Capital Proprietary Limited, A South African company which had dealings with Ecsponent. Another name which features prominently in the two companies (Status Capital and Ecsponent) is that of Edwin Soonius who was Ecsponent’s Country Director and now appears as a Director at Swaziland Debt Factoring Firm as well as Status Capital Building Society, Registrar of Companies records show. According to the records, the other two names are Michael Hodgkiss a former Getbucks Malawi Country Manager who is now Director at Swaziland Debt Factoring Firm and Claude Scholtz Director at Status Capital and a former Getbucks employee.

This has led to several questions from players in the financial industry and political circles on how the Financial Services Regulatory Authority (FSRA) gave Status Capital Building Society the license to operate when there were so many red flags.

“When Status capital was formed, there were already questions with the operations of Ecsponent, did they do due diligence and a background check on the company directors,” one person dealing in finance asked. Another one said it was frustrating that all the signs that it would end badly were there from the start, and these could have been flagged had the FSRA simply called the Financial Sector Conduct Authority in South Africa as the directors had been blacklisted by them. Status Capital Building Society was deregistered by the Registrar of Companies in 2020. This followed a letter from the then Financial Services Regulatory Authority’s (FSRA) Sandile Dlamini stating that Status Capital had been registered and licenced as a building society in the Kingdom of Eswatini.

“Section 12(2) of the Building Societies Act, 1962 states that whenever a society is registered under the law relating to companies registered under this Act, the Registrar shall notify the Registrar of Companies in writing of such registration, and the registrar of Companies shall thereupon strike the name of the society off the registrar of companies, therefore the authority requests that your office deregisters Status Capital (Pty)Ltd as a company,” Dlamini said.

The ESW Investment Group Investor Relations Committee feel that the Financial Services Regulatory Authority (FSRA) should provide answers on the registration of Ecsponent and Status Capital Building Society. The investors feel that FSRA should be questioned about how it failed to uncover the dishonest dealings and gave the directors a licence, not only once, but twice.

This, they said during a press conference held at the Mountain Inn on Wednesday. The investors said they were surprised when a licence was granted to the same director to operate a new entity, although there were already questions on the operations of Ecsponent. They did not specify the name Status Capital but said there was a similar entity which had been in the news recently and they feared that the investors would suffer the same fate they did. They said they were now hearing that the company was going under.

“The directors were flagged in other countries, but they were still granted licences in the country. The government and the FSRA should give responses on why this was the case,” one of the investors said.

They stated that they understood that licences were granted before Ncamiso Ntshalintshali became CEO, but he had to give emaSwati answers since this was now his office.

They said they understood that Ecsponent produced quarterly reports, which were supposed to be checked by the FSRA, and wondered what it is they checked if they failed to flag all the wrong that was going on.

“We are left confused as to what was it that allowed them to continue giving the same people licences to open other companies,” they said.
They also wondered who was looking out for the interest of emaSwati if regulators allowed such to go on. FSRA Head of Stakeholder and Consumer Affairs Mbuso Gamedze said more time would be needed to respond to a questionnaire as internal processes would have to be followed.

Recently, FSRA admitted to senators that there were loopholes in the country’s legislation, which are exploited by foreign investment companies that promise ridiculous returns. The authority revealed that such companies, including Ecsponent, did thorough research on the country’s legislation to ensure that they were granted operating licenses only to change along the way and make it difficult to understand their actual motives.

The senators questioned how FSRA issued licenses to companies who in turn rob emaSwati of their hard-earned money under the impression that they would get massive returns. This was not the first time the matter was raised by the legislators since Ecsponent was liquidated while in possession of about E340 million invested mainly by pensioners.

It was reported that FSRA Manager Licensing and Inspections, Bukhosi Dlamini said he could not dwell much into this matter since it had been deliberated at length in Parliament. Dlamini reportedly said their role was to issue licenses but Ecsponent conducted thorough research on their requirements to identify any loopholes before applying for the licence.

He claimed that the company manipulated the system and managed to find loopholes within the legislation and provided them with the exact documentation needed to acquire a licence. Dlamini stated that once they issued the licence, they could no longer monitor the companies’ transactions and discovered anomalies when it was too late. Meanwhile, on Monday, Members of Parliament (MP) during a sitting questioned why the Minister of Finance had not instituted the forensic audit on the Ecsponent matter as he had previously been given 60 days to do so.

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