Ponzi masterminds to be arrested

Johannesburg - Warrants for the arrest of Barry Tannenbaum and Dean Rees, alleged to have been behind a multi-billion rand pyramid scheme, have been issued, Finance Minister Pravin Gordhan said in his Medium-Term Budget Policy Statement in parliament.

Gordhan said one individual was thought to have benefited by up to R800m on which "he was not probably paying any tax."

The scheme crossed some eight jurisdictions, said Gordhan who was formerly head of the South African Revenue Service (Sars).

News agency Sapa reported in August that the High Court had frozen R43m linked to the pyramid scheme, also called a Ponzi scheme - a fraudulent ploy that pays generous returns to investors from their own money, or money paid by subsequent investors rather than from actual profit earned.

Tannenbaum, who currently lives in Australia, has denied being involved in such a scheme.

Before delivering his speech, Gordhan also announced that treasury has asked prosecuting authorities to bring Land Bank employees who have been charged with corruption to court "as soon as possible".

Gordhan said: "This has to be an example to South Africans and others (civil servants). Culprits that literally steal form the fiscus can't be allowed to get away with it."

Commenting on crime, Gordhan said it was undermining the ability of business and institutions to function.

"Our efforts have to include better vigilance in both the public and private sectors against corruption and financial mismanagement," said Gordhan.

- Fin24.com