FIC ruling a ‘significant victory’ in Sekunjalo Group’s battle with banks

FIC ruling a ‘significant victory’ in Sekunjalo Group’s battle with banks

In landmark victory for the Sekunjalo Group of Companies (Sekunjalo), Western Cape High Court Judge Daniel Thulare yesterday ruled that the Financial Intelligence Centre (FIC) must hand over all documents pertaining to Sekunjalo, its subsidiaries, as well as those pertaining to EOH and Tongaat Hulett.

Sekunjalo Investment Holdings chairman Dr Iqbal Survé said: “Sekunjalo welcomes the decision by the high court in favour of compelling the FIC to provide the documents we have been asking for.

“This is a significant victory for us as we have maintained from the beginning that there has been no basis for any of our accounts to be closed, as there is no wrongdoing by any of our companies.

“The decision to close our accounts has been motivated by political interference and is tantamount to economic sabotage in an effort to destroy the country’s biggest black-owned media house, along with other Sekunjalo-owned entities.”

Sekunjalo Group chairman Dr Iqbal Survé. Picture: Armand Hough/ Independent Newspapers

Sekunjalo is currently suing several major banks in South Africa for bias and racial discrimination, and has launched several concurrent lawsuits to support its Equality Court case.

The group had asked the FIC on several occasions to provide it with documentary proof that the banks had complied with the Financial Intelligence Centre Act 38 of 2001 (Fica), and submitted information to FIC relating to concerns over Sekunjalo and how it conducted its business, prior to closing all Sekunjalo-related bank accounts.

As the FIC had not been forthcoming, Sekunjalo had no option other than to compel the FIC.

In the judgment handed down yesterday, Judge Thulare granted Sekunjalo and its co-applicants, the right to access in terms of section 40(1)(e) and section 41 (d) and (e) of Fica.

In addition to the FIC providing documentation, Sekunjalo will now also have access to the risk management and compliance programmes of Absa Bank Ltd, FirstRand Bank Ltd, Investec Bank Ltd, Nedbank Limited and Standard Bank of South Africa Limited, who are respondent banks or accounting institutions who have been cited in the main Equality Court application.

Further, Sekunjalo was now entitled to receive all reports of suspicious and unusual transactions made to the FIC by accounting institutions in respect of EOH Holdings and its subsidiaries, KPMG Services Proprietary Limited South Africa, Steinhoff International Holdings NV and Tongaat Hulett Development.

Judge Thulare noted: “I find that the applicants have established their right to their information sought. Fairness and equity, and our constitutional values of openness and transparency, favour that the applicants be granted access to the reports which the respondent banks provided to the FIC as regards reputational and business risk as well as anti-bribery legal and regulatory framework.

“This is part of the portfolio of evidence that is material to determine whether the applicants were unfairly discriminated against, as they allege. The disclosure of this confidential information held by the FIC will help in the proper determination of the issues in the main application.”

In terms of the ruling, the required information is to be provided to Sekunjalo within 20 days of the date of the order, and the FIC is to pay the costs.

The ruling follows evidence in an interlocutory case brought by Sekunjalo, also heard in the high court, in which Judge Hawthorne heard from Nedbank’s counsel that there were no records of any minutes or meetings, nor had any documents been destroyed, pertaining to any misdeeds by Sekunjalo-related entities, that would spark reporting to the FIC.

It reinforces Sekunjalo’s contention that all bank account closures or threats thereof were not based on objective evidence, but rather on subjective desire under instruction.

“Today’s decision also reaffirms the necessity for, and correctness of Sekunjalo suing the Presidency and state organs for the sum of R75 Billion ($4 billion). The foundation of this suit is that the banks had no basis to close the accounts but were instructed to do so. Sekunjalo believes the FIC documents, or lack thereof, will prove their claims,” the group said.

Cape Argus