Former LeisureNet joint chief executives Peter Gardener and Rod Mitchell have registered no objection to a Cape High Court order that a forfeiture inquiry be instituted in terms of the Prevention of Organised Crime Act, and that the inquiry take place in September.
It relates to R6-million they each received in an underhanded gym deal, the court heard on Wednesday as sentencing procedures got under way before acting judge Dirk Uijs, who last month convicted them of fraud.
The hearing, due to start at 10am, was delayed while the prosecution and defence teams tried to reach agreement on the admission of documents that could have a bearing on the sentence.
When the court convened after lunch, prosecutor Bruce Morrison handed in a draft forfeiture order under the Prevention of Organised Crime Act, which he said he would ask Uijs to formalise once he had passed sentence.
”We have no objection to your making the order in these terms,” Van Zyl told the judge.
Morrison handed up a report from a Department of Correctional Services official, saying as he did so that while the state would concede that ”in isolation” Gardener and Mitchell were suitable candidates for correctional supervision, he intended to argue whether this would be appropriate.
He also handed up a record of Gardener’s previous convictions in June 2005 on 14 counts of fraud and one of insider trading, resulting in a R2,9-million fine and a suspended jail term.
Morrison conceded a point raised by Van Zyl, that those charges were ”part and parcel” of the events which led to the current case and ought not be regarded as a previous conviction when it came to sentence.
Uijs postponed the case to Thursday to give the prosecution and defence time to seek agreement on another document, part of which deals with the amount of money Gardener and Mitchell have paid back to LeisureNet’s liquidators.
He found last month that Gardener and Mitchell deliberately concealed from the LeisureNet board their financial interest in a German gym operation named Dalmore, at the time that the now-liquidated group bought out Dalmore in 1999 for about R30-million.
Under minimum-sentence laws, anyone convicted of fraud involving more than R500 000 faces 15 years in jail, unless a judge finds ”substantial and compelling” reasons to impose a lighter sentence. — Sapa