Pretoria - Former deputy registrar of retirement funds Rosemary Hunter will have to wait a while longer to know whether the court will rule in her favour in her case against her former employer.
Hunter was in the Gauteng High Court, Pretoria, on Thursday, slugging in out against the Financial Services Board (FSB) and its three top officials following the closure of thousands of dormant pension funds.
Acting Judge Hendrik Jacobs reserved judgment in Hunter’s application in which she asked for an array of orders. These include that the FSB be compelled to appoint independent investigators to probe the cancellation project - the closure of funds which occurred between 2007 and 2013.
Hunter brought the application against her former boss, FSB chief executive Dube Tshidi, chairman of the board Abel Sithole, former deputy registrar of retirement funds and now deputy registrar of collective investments Jurgen Boyd, and Finance Minister Pravin Gordhan.
Hunter’s appointment as deputy registrar lapsed on July 31.
The court this week, during two and a half days of legal argument, heard from her advocate, Chris Loxton SC, that when Hunter started her employment with the FSB, she quickly realised that the cancellation project was implemented unlawfully.
She feared that the affected funds and its members could be prejudiced by this move.
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Hunter insisted that the matter be looked into and the FSB established an inquiry conducted by retired Justice Kate O’Regan.
The judge, in turn, recommended a forensic investigation of a sample of funds to determine whether the alleged irregularities in the cancellation project resulted in prejudice to the fund members.
Auditing firm KMPG subsequently undertook a limited forensic exercise and concluded that the aggregate value of the assets reflected in the most recent financial statements for the 498 funds - for which the registrar did not have sufficient information as they had ceased to exist - was more than R2.5 billion. Thus, it was said on Hunter’s behalf, that R2.5 billion was not accounted for.
Loxton argued that instead of taking this “disturbing finding seriously” and taking reasonable steps to ensure that the potential for prejudice was limited, the FSB disagreed with the auditors’ report and sought another opinion.
“The FSB to date holds the position that the cancellation project, while imperfect, was conducted in good faith and that there is no need to further re-visit it, despite KPMG’s jarring findings,” Loxton added.
Hunter claimed her attempts to investigate the closure of the dormant funds were met with resistance from the start by Tshidi and other members of the FSB. These attempts, she said, included moves to frustrate the investigations she conducted and efforts to terminate her employment.
Loxton said the purpose of the application was to compel the registrar of pension funds, the FSB and Gordhan to comply with their constitutional duties and act in a transparent manner regarding the cancellation of the funds.
According to Hunter, the cancellation project was in many respects unlawful and in others, grossly negligent.
She feared it was probable that members and beneficiaries of several of the deregistered funds may have been unlawfully deprived of their retirement fund benefits.
Advocate Wim Trengove SC, for the FSB, asked that the application be dismissed, as Hunter, according to him, did not disclose a cause of action.
He said she should have rather brought a review application. “The FSB duly considered and investigated her complaints and its investigation of matters flowing from them is ongoing.”
Trengove added that Hunter’s prayers had grown with every round of papers filed.
He said she was told to await the finalisation of KPMG’s investigation into the matter and informed that her employment related complaints were attended to by the board.
“In the end it became clear to the board that Hunter would disagree with every attempt to deal with her employment-related claim She has proven herself to be quite impossible to satisfy,” Trengove said.