All the assets of financial-services firm Fidentia will be used to recover millions of rands it cannot account for, the South African Broadcasting Corporation reported on Monday.
It said this was decided at a meeting in Cape Town earlier in the day between curators and officials of the transport Seta (Sector Education and Training Authority).
Curator Dinesh Gihwala said thousands of records will have to be studied to establish the total amount allegedly misappropriated.
He said to finalise the matter will take months, if not years.
The transport Seta is seeking to recover about R250-million it invested in Fidentia.
The Herald Online reported that a former Port Elizabeth instant-lawn salesman was behind what could be the country’s biggest corporate-investment scandal.
J Arthur Brown, whose parents still live on the Garden Route, went from a humble plot in Greenbushes to a lifestyle complete with a R3-million annual salary, country estates, flashy cars and failed spas.
Brown (36) masterminded the Fidentia group of companies, which controlled about R2-billion, of which at least R680-million is unaccounted for.
Fidentia — known to many ordinary South Africans because it is behind the Infinity loyalty programme — was placed under curatorship last week.
The curators have to sort out — and if possible save — the Fidentia businesses and track down and secure assets.
According to the companies’ register, Brown was a director of several other virtually unknown enterprises in the Eastern Cape, including construction, transport and computer companies registered in Mthatha.
Brown rocketed from nonentity to fabulous riches, including millions splashed by his group of companies on corporate spending sprees.
Ten days ago, it was reported that Eastern Cape cricket was in jeopardy after the collapse of Fidentia, its major sponsor.
At risk is a R4,9-million deal Fidentia signed with the Warriors last year.
Fidentia also sponsored the Boland rugby team, renamed the Fidentia Boland Cavaliers, to the tune of R15-million.
The roles played by Brown’s business associates are also under investigation in a scandal that extends from impoverished orphans in the Lesotho highlands to one of the country’s top businesswomen, Dr Danisa Baloyi, a Living Hands trustee.
Brown, who paid himself an annual salary of R3-million and drove a Ferrari or a luxury 4×4, espoused a philosophy of ”responsible capitalism”.
However, financial investigators say he built a pyramid of companies by allegedly pilfering trust funds, including that of the Living Hands fund for widows and orphans of mineworkers.
According to associates, Brown was born in Namibia and was about six when his father died.
He and his two brothers grew up in South Africa with his mother and stepfather, who live in the Southern Cape in the Glentana area.
Brown’s qualifications as financial whizz-kid are unknown, but he told colleagues that he had studied at the University of Port Elizabeth and had once worked for a merchant bank.
His secretary this week also confirmed that he had lived in Port Elizabeth and had studied at the University of Port Elizabeth.
However, Nelson Mandela Metropolitan University (the result of a merger of the PE Technikon, the University of Port Elizabeth and the Port Elizabeth campus of Vista University) spokesperson Roslyn Baatjies said there were no records of him studying at the university.
He apparently moved to Cape Town about five years ago. — Sapa