Businessman’s smear campaign gets nasty

Everyone has a right to a fair trial, rich or poor, but no one has the right to simply untruthfully besmirch the reputation of others whom they perceive as their opponents.

I raise this because of the trial of Johannesburg businessman Simon Nash, the executive chairman of appliance company Cadac, who faces charges of fraud, theft and contravening the Prevention of Organised Crime Act arising from the alleged fraudulent stripping of retirement fund surpluses from the Sable and Cullinan/Powerpack retirement funds. Members and pensioners would probably have received better pensions if the surplus stripping had not taken place.

Since last year the Nash camp, which includes Nash’s wife and his public relations practitioner, Lance Rothschild, has taken the fight outside of the courts, mostly avoiding dealing with the merits of the charges against Nash. Instead, the Nash camp has focused on maligning many of those it sees as not being in its camp, making numerous untrue allegations against them.

This unacceptable smear campaign has now resulted in Nash’s wife, Elena Forno-Nash, facing at least one civil claim. This is consequent of a website registered in her maiden name, Forno, in August last year being used to take the campaign to new and very nasty heights.

Lawyers representing Nash and his wife, Forno-Nash, claim their clients were not responsible for the content of the website. They claim that “the party which uploaded the document to our client Mrs Nash’s website was not authorised to do so”.

“Our clients never have given instructions for the website to go live and the fact it did was an error on the part of the web developer and researcher.”

The registered site administrator, Rodwill Benecke of the company World Wide Design, denied in an interview that he had anything to do with the content or with the site going live. He said he was asked by “Mr Simon Nash and his wife to set up the site”.

He had been paid to register the site and for “nothing else”.

The Nash camp has ignored requests by Personal Finance for the names of the people responsible for the site and its contents.

In the smear campaign, the Nash camp has attacked various individuals and bodies, including the Financial Services Board (FSB), its chief executive, Dube Tshidi, and other executives; Tony Mostert, the curator of a number of retirement funds, and his legal team; and even me as editor of Personal Finance for reporting on the Nash saga.

A number of people who had already been smeared prior to the Forno-Nash website going live, are accused of criminal offences on the site, titled The Scam.

I am not going to repeat the defamatory claims, which have been made without a shred of evidence to back them up. The accusations are appalling.

The Nash camp seems to be relying on the propaganda tactic attributed to various leaders of Nazi Germany: “If you tell a lie that’s big enough, and you tell it often enough, people will believe you.”

The Nash camp has latched onto the fees, which they over-inflate but which are approved by the High Court and supervised by the FSB, that are paid to Mostert as curator, as some sort of warped defence against the criminal charges and multi-million-rand civil claims Nash faces.

Nash consistently avoids dealing with the merits of the case against him outside of the courtroom, only claiming that what he did was legal at the time and there is some massive conspiracy against him. His claimed legal structure for the stripping of the surpluses involved paying out about a third of the surpluses to various facilitating parties in fees and commissions.

It is a process for which a number of people have now been convicted and which the FSB has claimed in court papers was fraudulent.

In the end it is for no one but the courts to decide Nash’s guilt or otherwise.

He and/or his coterie have yet to lay a single charge against any of the parties maligned and accused of criminal acts on the Forno-Nash website and previously through various media.

In attempting to smear me, Nash has written to my colleagues, including the chief executive of Independent Newspapers, making unacceptable claims and falsely accusing me, among other things, of being a puppet of Mostert.

I have now been accused of far worse on Forno-Nash’s website. The Nash camp has yet to lay a complaint about my reporting with the Media Ombudsman or lay criminal charges relating to the obnoxious claims that I am involved in illegal activity. Clearly the aim is to intimidate me and to prevent me from keeping Personal Finance readers informed about what is happening in the various legal actions involving him. They deny that they are attempting to intimidate me or Personal Finance.

Apart from his criminal trial, Nash is embroiled in another battle involving the Cadac Pension Fund.

In December 2010, the Cadac Pension Fund, of which Nash was chairman and his wife, Forno-Nash, a trustee, was placed under the provisional curatorship of Mostert after Tshidi alleged in court papers, on the basis of an FSB inspection, that almost R10 million from the fund had been used to pay for legal services relating to his criminal trial for the alleged surplus stripping as well as in unacceptable property deals.

In the court documents it is claimed that the alleged irregular payments were approved by Nash and Forno-Nash as fund trustees, who were given an open-ended approval of the other fund trustees.

The only formal complaint against me in this nasty saga comes from the former Cadac fund legal consultant, June Marks, who now represents Arthur Brown of Fidentia fame. Marks did lay a very garbled complaint in her personal capacity against me last year with the Media Ombudsman. She withdrew the complaint as she got herself ever-increasingly tied up in knots about the nature of the complaint, with the office of the Ombudsman even having to try to frame the complaint for her.

Marks herself now has judgments against her – which she is attempting to appeal against – for more than R10 million for the fees withdrawn from the Cadac fund. In court documents it has been shown that she siphoned off a portion of the fees she claimed were due to other advocates. She is also the subject of a Law Society investigation.

Incidentally, Brown, with Marks as his attorney, is attempting to sue me for R33 million, and others for even more absurd amounts.

Forno-Nash was warned on Tuesday last week by Mostert and his legal team and separately by Independent Newspapers’ lawyers that urgent High Court interdicts would be sought if the offending false claims were not removed from the website by Tuesday evening. The Nash alliance closed down the website because, they say, “it ought never to have gone live in the first place”.

As consequences of the website and earlier smears:

* Mostert and his team are considering laying criminal charges and making substantial damages claims against the Nash camp;

* The FSB is considering what action it should take; and

* I intend suing Forno-Nash and possibly others for R250 000. Any award will be donated to a facility for the destitute aged.

One of the photographs published on the Forno-Nash website is of Lucas van Tonder, one of the advocates on the Mostert team, who is shown in a particularly adverse state. He was attacked by armed robbers in his home and badly beaten up. He escaped being murdered by diving out of a first-floor window.

A photograph of Van Tonder in his battered, blood-covered state was placed on Forno-Nash’s website without any explanation, but obviously trying to show Van Tonder looking his worst after his horrific ordeal. That is disgusting. Shame on the person who did this.

The Nashes claim they would never have allowed this photograph to appear on the website.

Incidentally, last week Van Tonder was recommended by the Bar Council to the Judge President to be a senior counsel. He had applied for silk some time ago but it was blocked by trumped-up complaints to the Bar Council from the Nash camp.

The worst thing about all this is the consequent legal actions being taken cost money, and a lot of the costs are reducing what pensioners should receive.

This smear campaign, combined with some of the delaying and often contradictory machinations employed by the Nash camp, are not what justice is supposed to be about. It is only made worse by a National Prosecuting Authority that is not operating to the levels of efficiency required to dispense justice quickly and fairly.

Status of main players in the surplus stripping

Currently more than R700 million, recovered by Mostert and his team, is being distributed to many thousands of pensioners in terms of pension surplus apportionments approved by the Financial Services Board.

Retirement funds affected by the surplus-stripping by employers in the 1990s are Mitchell Cotts, which was stripped of a surplus of R23.6 million (now R172 million with interest); Lucas of R14.9 million (now R87 million); Picbel of R41 million (now R127 million); Sable of R36 million (now R179.4 million); Cullinan/Power Pack of R41.8 million (now R145 million); and two Datakor funds and Cortech of a total of R138 million (now R421 million).

The situation in the broader surplus-stripping affair is:

* Six people and one institution have entered into plea arrangements with the State, allowing them to escape serving time in prison for their roles in the theft of money from pensioners. They are:

- Peter Ghavalas, a former Nedcor senior executive and the architect of the scheme that saw retirement funds stripped of their surpluses in the ’90s. Ghavalas was ordered to pay back R18.6 million in compensation and was given a suspended 15-year prison sentence.

- Rowland Bailey and his wife, Shirley, who benefited from the surplus in the Mitchell Cotts Pension Fund. Bailey received a total of 19 years’ imprisonment suspended for various periods for fraud, contravening the Financial Institutions (Investment of Funds) Act and money laundering. His wife was sentenced to a suspended five-year prison term.

- Cape businessman Jan Pickard Jr received a suspended two-year sentence for the theft of a R28.8-million surplus in the Picbel Group retirement fund. Pickard paid R21 million to the fund’s curators.

- Former Datakor chief executive Michael McEvoy and financial director Derrick Pettitt pleaded guilty and received suspended five-year prison terms for three counts of contravening the Financial Institutions Act. They were also ordered to pay R1 million each in compensation despite sharing in R4.9 million (now worth R18 million) from the surpluses in 1998.

- Financial services company Alexander Forbes pleaded guilty to contravening the Financial Institutions (Investment of Funds) Act. It was fined R10 000 and ordered to pay a further R5.49 million to Mostert, on top of a R342-million civil claim settlement.

* Still facing criminal charges, apart from Nash, are:

- Former Alexander Forbes senior executive, Peter Martin.

- Aubrey Wynne-Jones and his company, Wynne-Jones and Company Employee Benefits Consultants, who are due to appear in court, relating to the Sable, Cortech, Datakor and Cullinan/Power Pack funds.

- Jacques Malan and his retirement fund administration and consultation company, Jacques Malan and Partners.

- Johannes Roets, the Sankorp executive seconded as chairman of Datakor at the time of the stripping.

- William Graham Somerville, the former chief executive of hospital group Esidimeni (known as Lifecare at the time) and chairman of the Lifecare Retirement Fund, through which most surpluses were allegedly laundered.