Mr Moneybags shrugs off the load
Customs officials must get tired of rifling through people's luggage in search of illegal substances, only to find dirty laundry. But the contents of South African billionaire Christo Wiese's luggage proved to be far more interesting for the customs staff at London City Airport. When they searched his luggage in April 2009, they discovered bank notes worth £120 000 in his hand luggage and £554920 in his bags checked into to the hold. They must have thought they had caught a major mover in the Cosa Nostra.
Instead, they had confiscated what was really small change for South Africa's third-richest man. But it has taken three-and-a-half years – and many dinner-table discussions about why anyone honest would want to cart around so much money in his luggage – for Wiese to win his case on appeal at the High Court in London and have his cash returned.
"I was confident that I would win because I had done nothing wrong and was carrying the cash according to the rules," Wiese said. "But I was always aware of the often unsaid insinuations."
Although he said "it's over now", the lingering doubt over his integrity and the time spent on ridding his reputation of money-laundering accusations had to have taken their toll on him – but not on his business deals, he said.
"The accusations were always out there, but I got the sense that it never impacted on my ability to conclude transactions or deal with banks – during that period I did some substantial transactions."
Although carrying such a large amount of cash in carry-on luggage might seem like a scene from The Godfather to most people, Wiese said it was not illegal. "I took advice in London and I was told that, if I was travelling within the European Union, there is no limit to the amount of cash I could transport between countries. A declaration has to be made only if you are travelling outside the EU and are carrying more than €10 000."
Wiese's explanation was that he had decided to invest the proceeds earned from diamond deals done in Belgium that had been sitting in a strongbox at the London branch of Swiss-based bank UBS for about 20 years. "I'd never got around to investing it before; it had never exercised my mind. I had decided to deploy the funds and earn some returns on it and was taking it to my bank in Luxembourg.
"If I'd gone through the normal channels and opened a bank account in the UK, I would have had to make various declarations on transactions that were done many years ago. It was the easiest route and completely legal."
Wiese said that when he was stopped before boarding his plane, he gave the customs officials the number of his bank in Luxembourg and told them who to contact to verify his story. He also gave them numbers to call to confirm his strongboxes at UBS and, at the Ritz Hotel, to where he had transferred the money before his trip. "They weren't interested. They just took the view that the money was recoverable."
So did the Westminster Magistrate's Court. When the case was heard in December 2010, the court believed it was the proceeds of criminal activities and ordered that it be forfeited, although the case itself was always a civil matter and not criminal.
Wiese took his case on appeal and hired the best lawyer he could find, British barrister Claire Montgomery, a leading silk in crime, extradition and fraud, known best to South Africans as acting for Shrien Dewani, accused of hiring a hit man in South Africa to murder his wife.
The appeal took a year and half before it was heard. Wiese said that the British Border Agency took 18 months to file skeleton arguments, or pleadings. Only once these were lodged could a court date be set.
"After the magistrate's court order in December 2010, we filed our skeleton arguments to the High Court in January 2011."
On June 29 this year, Justice Nicholas Underhill said he believed Wiese's explanation for carrying so many bank notes in his suitcases, ruled that Wiese was not engaged in money laundering and ordered that the money be returned to him. Within a few days it was in Wiese's Luxembourg bank account.
He would not say whether he planned to take the case further. Perhaps he could sue the border authority? "I need to discuss the details with my lawyers," he said, adding that there were "no tax implications" on the funds.
Underhill did not award costs to Wiese, which came to about £30000, because, the judge said, he had brought the problem on himself.
Wiese could contest this. So, although he said the case was over, it could still have some way to go before he could cross it off his list of things that keep him awake at night.
"I am an old war horse and know that these things happen and become far more newsworthy when you are in the public eye. But it is not nice when you have children and a family who hear the gossip at dinner parties or around town."
Wiese recounted another unpleasant incident when he was accused of nepotism. In 2005, Shoprite chief executive Whitey Basson was awarded a R59-million performance bonus and the media wanted to know why.
"I told Whitey to send anyone to me and I would tell them the reasons," said Wiese, who is chairperson of Shoprite, of which he owns 16.5%.
Wiese's wife's maiden name is Basson and the rumour was that Basson was his brother-in-law and this was why he had agreed to the large bonus.
"When a journalist accused me of nepotism, I asked him to my office and told him that it was correct that Whitey and my wife had the same surnames, but they were not related. I told him that my wife came from the beautiful Bassons. That seemed to put an end to the rumours, although Whitey wasn't entirely happy, but we remain the best of friends."
But this might seem mundane compared with battling money-laundering accusations with the British authorities.
Wiese, who is worth $3.1-billion and 367th on the global rich list, according to Forbes, admitted the case had taken up time that would normally have been spent on managing what he called "the family business".
The family business
This includes stakes held in listed companies Shoprite, Tradehold and Invicta, and the unlisted Pepkor. He is the chairperson of all of them. He also has a 33% stake in investment company Brait (which he uses to hold some of his investments, such as parts of Pepkor and Primedia), shares in mining and diamonds, property such as his Lourensford wine estate and many other shareholdings held ultimately by his private investment company, Titan Investments, which he manages from the third floor of Pepkor in Parow.
Wiese recently sold Lanzerac, the historic wine farm-turned-hotel, to a British consortium of property investors. "My daughters are city girls and don't want to live there. There was no point in keeping it any more."
His son Jacob joined "the family business" two years ago and is a director or alternate director on a number of boards, including Shoprite and Primedia, and his daughters might eventually follow him. "We're all passionate South Africans, so even though my children have spent time studying abroad, they all want to remain in South Africa."
Hopefully, he has warned them about the pitfalls of having a public profile.
Wiese said he had once discussed the issue with rugby administrator Danie Craven, who told him: "It is the tallest trees that catch the most wind, but the worst happens at the bottom where the dogs get you too."