J Arthur Brown acted out of "greed" and used funds meant for the poor "to live his dream of building an empire", says the NPA.
|||Cape Town - J Arthur Brown acted out of “greed” and used funds meant for the poor “to live his dream of building an empire”, to buy beach properties for his family trusts and luxury 4x4 vehicles, according to the National Prosecuting Authority.
These and other scathing accounts of Brown’s conduct are contained in court papers filed by the NPA, which is applying for leave to appeal against the “lenient” sentence handed down to Brown by Judge Anton Veldhuizen, who has said the case was ”mismanaged”.
Last month, Judge Veldhuizen effectively sentenced Brown, the former head of Fidentia, to a R150 000 fine or three years in jail after Brown was convicted on two counts of fraud. Brown initially faced 192 charges.
At the time, Veldhuizen said he could “only think that the prosecution’s case had been poorly handled”.
The sentence led to an outcry from the Financial Services Board which said the right message had not been sent to other white-collar criminals.
Brown’s two convictions related to misrepresentations made in handling investments for the Transport Education and Training Authority (Teta), as well as during Fidentia’s takeover of the Mantadia Asset Trust Company (Matco).
The NPA’s papers said investment funds received by Fidentia were State funds meant “to train and empower mainly the lower-income members of the community and the struggling end of the economy”.
Under Brown, the trust funds had been used for a number of things which, according to the court documents, included:
* “Purchasing two beach properties for (Brown’s) family trusts and personal benefit in the amount of more than R11m and trying to cover it up with lies about fees owed…”
* “Buying fully overland kitted-out luxury 4X4 vehicles for himself and his co-directors in the amount of R3.3m for no good reason or benefit of the investor, Teta…”
* “R8m was paid from the Teta funds under very suspicious circumstances to an official at the Saudi Arabian embassy. This amount was never recovered.”
“Fidentia continued over the full period of fraud, namely three-and-a-half years, to make repeated misrepresentations to Teta by rendering false statements to it,” the NPA said.
The NPA papers said the Teta funds and Matco funds, trust funds of widows and orphans, were put into high risk investments or “recklessly spent”. Among other things, R12m had been used to buy the Thaba Manzi farm and register it in the name of a family trust in which Brown was a trustee and beneficiary.
The NPA argued that the court had “imposed a sentence that is startlingly and inappropriately lenient” and had “erred by disregarding the evidence of five witnesses called by the State on the two fraud counts without giving any reason for doing so”.
caryn.dolley@inl.co.za
Cape Times