Publications
Partners
Cape Town - Former Fidentia boss J Arthur Brown on Thursday said he felt vindicated that a court had found him guilty on only two fraud counts.
"I've been vindicated in many respects... and this ends a very long and unpleasant chapter in my life," he said outside the Western Cape High Court.
Judge Anton Veldhuizen found him guilty of defrauding the Transport Education and Training Authority and the Mantadia Asset Trust Company (Matco).
He was acquitted on seven other charges of corruption, money-laundering, theft and fraud.
"If you remember, this saga started six years ago... I was running the biggest pyramid scheme in the history of this country, I had stolen billions [of rands], I had smuggled it offshore, and in fact, originally I was arrested on 197 counts," Brown said.
"Being found guilty on two technical, statutory offences, yes they do carry minimum sentences, but I do believe the judge will take all the factors into account when he eventually sentences me."
Brown said neither he nor Fidentia would ever be held responsible for things they had not done.
His R1m bail was extended and he was told to return to court on April 29 for sentencing arguments.
Outside court, prosecutor Jannie van Vuuren said he was relieved the trial was almost over and thanked the police and the Financial Services Board for their support. He praised Brown for his willingness to find a resolution to the matter.
"It is definitely a relief. I think there is a massive cost-saving effect as well in terms of continuing with it. We called five of a potential 50 witnesses so far, so it could have dragged on for quite a while still," Van Vuuren said.
"The accused also made a huge contribution to the matter by negotiating with the State and being willing to settle the matter in the way we settled it."
Brown handed in an admissions document last week relating to the two fraud charges he was convicted of. The court however had misgivings about the strength of the admissions. He then handed in an altered document which the court accepted on Wednesday.
He initially admitted Fidentia did not have enough liquid cash at the time of its purchase of Matco, but that it had enough assets in the form of negotiable instruments.
He admitted Fidentia had misrepresented itself by saying Matco's full purchase price would be paid before it took control.
The admission statement handed in on Wednesday included the terms of the purchase agreement and made it clear the purchaser had to have "immediately available funds".
"Fidentia and I misrepresented that Fidentia was able to do so and thereby induced the shareholders of Matco to enter into the agreement and sell their shares to Fidentia," Brown said in the altered document.
He admitted Fidentia took control of Matco in October 2004, before full payment was made to all shareholders, contradictory to the terms of the agreement.
Accepting personal responsibility, he said he ordered the transfer of R69m from the Matco account to Fidentia, which would later be used to pay the remainder of the Matco purchase price.
"The above actions amounted to a misrepresentation of the true facts in respect of the sale of share agreement and the method and time of payment... My actions were unlawful and constituted fraud by way of dolus eventualis [indirect intent]."
The minimum sentence for fraud is 15 years in jail, unless extenuating circumstances can be proved.
