FCSA strips Moses Kotane's grandson of his licence
Politics / 24 November 2019, 10:06am / Loyiso Sidimba
A businessman and scion of a Struggle icon’s family accused of using VBS Mutual Bank for unlawful activities has been ordered to repay the R10 million he received from a Namibian bank four years ago.
Moses Kotane’s grandson Mauwane Kotane was also debarred and his company Mamepe Capital’s licence to operate as a financial services provider was withdrawn by the Financial Service Conduct Authority (FSCA) this week.
According to the FSCA, the regulator of the South African financial services industry, Kotane jr was involved in a fraudulent scheme including claiming he had secured a new R175m investment for the now-defunct Namibian bank, Small and Medium Enterprises (SME) Bank in 2015.
SME Bank paid Mamepe Capital R10m as a once-off upfront payment for all past, present and future work to provide Kotane’s company with sufficient cash flow, but without having raised any capital for SME Bank.
The regulator found that Kotane was a dishonest person and rejected his lawyer’s claims that he was just naive.
“Kotane lied for the reason he gave and that was to protect his business and because he believed that if he gave false information the problem would go away and business would be as normal,” reads the FSCA’s Financial Services Tribunal’s ruling handed down on Tuesday.
Kotane had approached the tribunal to fight the FSCA’s decision to hand him a decade-long ban and the withdrawal of his company’s licence to operate as a financial services provider, which was delivered earlier this year, and ask that it reconsider them because they were unduly harsh.
The tribunal found that the facts led ineluctably to the conclusion that Kotane did not meet the fit and proper requirements to be licensed despite his impressive commercial CV.
Kotane taught at Wits University’s Graduate School of Business Administration, is a former Finance and Accounting Sector Education and Training board member and ex-Nedgroup private wealth stockbrokers dealer, among others.
Mamepe Capital entered into a five-year agreement with VBS to be the custodian of some of SME Bank’s investments. The agreement was signed in July 2016 by disgraced former chief executive Andile Ramavhunga, SME Bank’s former chief executive Tawanda Mumvuma and Kotane in his capacity as Mamepe Capital director.
In terms of the agreement, VBS would receive payments accruing to SME Bank and make payments to the Namibian institution while Mamepe Capital would manage the portfolio of assets comprising a group or groups of investments on SME Bank’s behalf.
Mamepe Capital would then return some of the invested funds to SME Bank and pay returns through VBS.
Kotane’s troubles appear to be piling up as VBS Bank’s liquidators are co-operating with their counterparts at SME Bank, which was liquidated in Namibia in 2017, and have provided them with documentation on the relationship and transactional history between the doomed institutions.
Two weeks ago, VBS liquidators told creditors at a meeting in Polokwane that SME Bank’s liquidators had launched an inquiry in terms of section 417 of the Companies Act and subpoenaed VBS.
“I am co-operating with their investigation and have submitted the available information,” stated VBS liquidator Anoosh Rooplal in his report dated November 8.
Section 417 applies to the winding-up of a company unable to pay its debts, provides for directors, officers or persons known or suspected to have in their possession any property or believed to be indebted to be summoned and the process through which such information can be collected.
Kotane did not respond to Independent Media’s questions on Saturday.