Oceana Trust beneficiaries take the battle for empowerment to Parliament
CAPE TOWN - MEMBERS of Parliament have called on the Department of Environment, Forestry and Fisheries (Deff) to investigate top fishing company Oceana following damaging allegations of black economic empowerment (BEE) transgression by some former and current employees.
Deff said the department condemned all forms of fronting and any abuse of disadvantaged people for purposes of self-enrichment.
Beneficiaries of the Oceana Empowerment Trust (OET) have accused the company of using black employees to gain fishing rights and for registering and transferring employees’ shares to the OET trustees.
Rebecca Jonathan, an ex-employee of Oceana and OET beneficiary, wrote to Parliament to allow her to present evidence on the matter and for an urgent investigation to be conducted.
Oceana has dismissed this claim as baseless, stating that the 2013/14 amendment did not result in a dilution of shares. “Employee beneficiaries were fully informed about the amendment to the Trust deed. From 2013 to 2014, there was a material amendment to the Trust deed to provide for the extension of the lock-in period vesting date, the payment of a cash payout and a beneficial change to the amount of dividends employee beneficiaries receive for the shares.”
OET chairperson Jayesh Jaga said the Trust was not aware of any charges laid against them as they had not yet been approached by either the SAPS or the Deff regarding an investigation.
Jonathan said: “The South African economy funds were also used to benefit US citizen Francois Kuttel, who relocated to the US in 2018 after he won the Daybrook deal. Kuttel was supported by Oceana as they are shareholders of Daybrook Fisheries in the US.
“Therefore, it could not be said that Oceana had black shareholders while they enjoyed the benefits of being allocated fishing rights? This is considered prejudice to individuals and smaller fishing companies.”
Mushtaq Brey, the chief executive of Brimstone, which has a 25 percent interest in Oceana, said the audited financial statements of Oceana for the year to September 30, 2017, disclosed the total remuneration earned by the executive directors in detail.
“It details the remuneration of former chief executive Kuttel, former chief financial officer Imraan Soomra, and former executive ABA Conrad. Only two of these executive directors are classified as black, thereby fitting the criteria of OET and thus benefited from the OET. “The aggregate number, the dividends received by Kuttel from OET would equal zero and his gain is solely attributable to his share options allocated to him as part of his normal course of employment,” said Brey.
Jonathan’s attorney, Ash Harripersad, who is representing other OET beneficiaries, had last month laid charges against the company and instituted a civil claim.
The EFF’s Nazier Paulsen and the DA’s Dave Bryant, who both serve on Parliament’s portfolio committee on environment, forestry, and fisheries urged the minister to investigate the matter as soon as possible.
While Bryant agreed that the allegations made by the employees would need to be tested through a proper investigation, he also stressed that “the serious challenges being faced by all
stakeholders in the fishing industry are as a result of the long outstanding fishing rights allocation process. “The uncertainly being caused by the delays and errors in fishing rights allocations is making the industry all the more unstable and this must be addressed by the minister as a matter of urgency.”
EFF’s Paulsen said the Oceana matter was not a problem within the fishing rights allocation process, but rather “a problem in itself, and an issue of criminality where the judiciary should execute justice.
“The Fisheries Department has shown that they are incapable of transforming this sector to benefit the poorer fishing communities and instead has always prioritised the large fishing corporations.
“In addition, this department has in its employ some of the most corrupt
state employees who also prioritise the bigger, more established corporations. It would be interesting to see if they will conduct their own investigation in the Oceana matter.”
Deff’s director of communications, Zolile Nqayi, said the department did not condone fronting and believed that if the accusations were true, they should be investigated.
Nqayi said the department would co-operate with any relevant agency investigating the matter and would take the necessary steps should these allegations be confirmed.
OET chairperson Jayesh Jaga dismissed all claims of impropriety as baseless and without merit, and said beneficiaries were aware of certain changes made to the Trust deed and had participated in a voting session in 2013 to make the amendments.
Brey also said he believed that no fraud had been perpetrated on or by OET or its trustees. He confirmed that Brimstone was aware that a small number of the beneficiaries of OET had made accusations against Oceana.
“We thus explicitly deny the accusation that this was a front in any form. The OET was set up for the benefit of black employees only and is a genuine empowerment initiative.
“Approximately 2 400 current and/ or former black employees of Oceana, all beneficiaries of the OET, have and will further benefit financially from the winding up of the Trust.”
Brey said the trustees of the OET included two employee-nominated trustees and two employer-nominated trustees, who were also entitled to the shares.
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