While J Arthur Brown’s awaits his sentencing, a family is still waiting to be paid from a Fidentia-linked trust fund.
Brown’s lawyer asks court for mercy
By Leila Samodien
The fate of Arthur Brown lies in the hands of a judge who will hand down the former Fidentia boss’s sentence on Wednesday.
Brown’s defence has asked Western Cape High Court Judge Anton Veldhuizen for punishment in the form of a fine, while the State wants him jailed.
As a final word during Monday’s closing arguments, Brown’s advocate, Braganza Pretorius, asked the court to “please grant him mercy”.
Brown was convicted on two counts of fraud after pleading guilty to two counts.
They related to misrepresentations he made in handling investments for Teta, as well as during Fidentia’s takeover of the Mantadia Asset Trust Company (Matco).
Pretorius acknowledged that his client hadn’t been convicted of “Mickey Mouse charges”, saying a “stiff fine” would be appropriate.
In terms of legislation, fraud involving amounts of more than R500 000 has a minimum sentence of 15 years’ imprisonment. However, he argued that the charges Brown had pleaded guilty to do not involve a monetary value.
Pretorius said his client had only admitted to foreseeing “potential prejudice” (harm) and that he’d reconciled himself with this, nothing more.
Citing case law, he said all evidence and elements relating to the offence had to be proved before the conviction.
He then accused the State of trying to introduce these elements during sentencing “under the guise of aggravation. No actual prejudice was admitted and what Mr Brown admitted to cannot be measured in monetary terms”, said Pretorius.
Prosecutors Jannie van Vuuren and Thersia du Toit-Smit, however, have asked Judge Veldhuizen to impose the minimum sentence of 15 years.
Van Vuuren said the fraud counts Brown had been convicted of involved R185 million.
“Imprisonment is the basic essence of the 15 years… A fine doesn’t come into play where the minimum sentence is applicable,” he said.
Van Vuuren argued that Brown had changed his plea because he “knew the risk involved” had he continued with the trial.
Five State witnesses had already testified, he said, and the State was of the view that Brown’s admissions were “in addition to the evidence already presented”.
Van Vuuren said it was
on record that there had been “actual losses”, not just potential harm, adding, “It’s submitted that the court is entitled to the full picture and the whole truth.”
In looking at the three factors considered during sentencing – the crime, the offender’s personal circumstances and the community – Pretorius said while his client admits fraud was a “serious crime”, he had implemented measures such as insurance to minimise the risk to investors.
He described Brown as a first offender who had been ostracised in the media, assaulted in custody and hadn’t seen his two sons in years.
Brown, who had spent the last six years living off his friends and family, had also expressed remorse.
But Van Vuuren said Brown’s actions had in some way been “premeditated”, he hadn’t shown “any real remorse” and there weren’t sufficient substantial and compelling circumstances to warrant a lesser sentence.
‘I don’t know what happened to the money’
By Caryn Dolley
The Living Hands fund for orphans promised to be “a helping hand to the living, bringing life and hope to families”.
But Siphe Mhlutwa’s family are still waiting to be paid what is due to them after their father died. Holding a tattered Living Hands newsletter, dated 2005 and with the signature logo of a hand cradling a baby’s feet, Mhlutwa, 27, a security guard living in Kayamandi, Stellenbosch, said his family had only received one payout from the fund in roughly six years.
The Living Hands Umbrella Trust, a provident fund for orphans whose mother or father died while employed, is one of four trust funds which lost investments worth more than R1.3 billion when Fidentia and its associated companies were placed under curatorship in 2007. Former Fidentia chief executive Arthur Brown faces sentencing on Wednesday on two separate fraud counts involving misrepresentation.
More than 80 percent of R1.1bn misappropriated from Living Hands has not been paid out to beneficiaries of the trust.
Over the six years since Fidentia and its associated companies were placed under curatorship, the nearly 60 000 beneficiaries either went without monthly payments for years or received a trickle of money – a fraction of what had been invested for them.
Some beneficiaries are yet to be tracked down for them to claim their money.
Speaking outside his shack, Mhlutwa said two of his sisters were Living Hands beneficiaries and should be receiving money monthly.
But since about 2007 only one amount – R2 100 – had been paid into his mother’s bank account for them, on February 20. Neither he nor his mother knew when money would be paid out again.
According to Living Hands “trust status” letters from October 2005 which Mhlutwa has meticulously kept:
* His sister Ntombentsha, a beneficiary since 2002 until April 2015, had a trust account value of R16 757.77 and monthly income payment of R127.
* His other sister, Kutho, a beneficiary since 2002 until November 2022, had a trust account value of R28 120.87 and monthly payment of R177.
Both sisters were beneficiaries until age 21, as Mhlutwa himself had been.
The Cape Times calculated that if both sisters had been paid monthly from January 2008 until this month, together they would have received R19 760, more than nine times the R2 100 Mhlutwa said his mother received in February.
Mhlutwa said he had faxed the Living Hands trust a number of times, but had no reply.
He rarely had e-mail access.
Asked whether he had heard of Fidentia, money being misappropriated from the fund, the related court case, or Brown, Mhlutwa replied: “No”.
His father, a former road worker for Paarl municipality, died in 2001 and Mhlutwa and his family relied heavily on the Living Hands payouts as their mother was unemployed. She lives in the Eastern Cape.
His brother Yanga was stabbed to death in 2006.
Mhlutwa moved to Cape Town five years ago to look for work to support his mother and sisters as the payouts from Living Hands had suddenly stopped the year before.
“I keep trying to find out what happened to the money, but I don’t know.”
Cape Times