News / 30 September 2016, 11:51am / Sandi Kwon Hoo
Kimberley - The men found guilty in the Trifecta trial are not facing just “a slap on the wrist”, it seems.
Northern Cape High Court Judge Mmathebe Phatshoane on Thursday dismissed an application by the defence for another postponement to compile correctional supervision reports. No court in South Africa may impose a sentence of correctional supervision without the completion of a pre-sentencing report by a correctional official or a probation officer.
Sentencing will be handed down in the Northern Cape High Court on December 6 and 7, while judgment will also be delivered on the confiscation order on the same date.
CEO of Trifecta Investment Holdings (Pty) Ltd, Christo Scholtz, and former ANC provincial chairman, John Block, were found guilty on corruption and money laundering charges, relating to government leases that were awarded to Trifecta in exchange for gratifications.
The defence informed the court that the high-powered businessman and former senior politician were now penniless.
Advocate Cornwell Tshavhungwa added that it would be “too harsh” a sentence to incarcerate his client.
“Block never used his political powers and genuinely believes that he did nothing wrong.”
Tshavhungwa said that since his voluntary resignation from politics and provincial government, Block was unemployed.
“He is responsible for financially supporting his four daughters, elderly parents and extended family. He has motor vehicle obligations amounting to R11 000 per month, although he has no source of income.”
Tshavhungwa indicated that Block’s previous theft conviction in 1989 was not of “any consequence” as it occurred more than ten years ago.
“Block has been reduced to a persona non grata’ as he has not been able to conduct any business with the private sector or government. He has not been able to serve as a director of a company since the guilty verdict was handed down.”
He added that the conviction was still the subject of an application to the Supreme Court of Appeal as well as the Constitutional Court.
“The accused has already been severely punished. He lost his political positions, his job and source of livelihood. He has had to pay for his legal costs for a period of five years, dating back to his appearances in the Kimberley Magistrate’s Court.”
Tshavhungwa indicated that Block was forced to pay R350 000 into the Criminal Asset Recovery Account in respect of the renovations to his guest house.
“He will have to pay over R2 million in terms of the confiscation order and R123 000 for curator costs.”
He added that Block’s company, Chisane Investments, was no longer an operating entity.
“There is no money to withdraw from this bank account to pay a fine.”
He recommended that a five-year suspended sentence and an appropriate period of community service would suffice to rehabilitate his client.
Meanwhile, Advocate Tokkie Van Zyl SC advised the court to impose a fine of R20 million on Scholtz and his respective companies or alternatively issue him with a suspended sentence or subject him to correctional supervision.
Van Zyl pointed out that the hefty penalties that would be levied on the Trifecta group of companies would result in the businesses being declared insolvent and lead to job losses.
“Scholtz said that a money laundering conviction is like imposing a death sentence on his businesses.”
Van Zyl added that his client’s bank accounts had been frozen and that he had been forced to resign as director of his companies following his conviction.
“The Financial Intelligence Centre Act (Fica) has red-flagged my client and has prevented him from conducting his business both nationally and abroad.”
Van Zyl stated that Scholtz was the only person with the knowledge and management skills to keep his businesses afloat.
“These entities will collapse, should he be incarcerated. The confiscation order would have a direct effect on Scholtz, who has a majority shareholding in some of the other companies.”
He requested the court not to “ruin the remainder” of Scholtz’s life by condemning him to a prison cell, as he was 56 years old.
Van Zyl said that his client was neither the instigator of the said leases, nor had he influenced anyone in approving the rental agreements.
“His conduct was limited to his interactions with the late co-director of Trifecta, Sarel Breda, who had identified previously disadvantaged beneficiaries for his trust and introduced him to the late Yolanda Botha, who was the former HOD for the Department of Social Development.
“Breda had a relationship with Block and Botha, where Scholtz came onto the scene at a later stage. Scholtz did not know Block or the identities of the trust beneficiaries and did not reside in Kimberley. He only became involved when he arranged that ten percent of shares in the company be transferred to the Jyba Trust. He only met Botha in 2007.”
Van Zyl added that the renovations to Botha’s home in Jawno Street, Monument Heights, only started after she had resigned as HOD of the Department of Social Development.
“Scholtz was only aware of a R338 000 payment that was made from the Casee trust that was authorised by him to Duncan and Rothman in respect of legal fees to assist Block, upon the request of Breda. He had no knowledge of the payments towards the renovations of Block’s guest house in Upington.”
He stated that Breda had secured the Trifecta lease agreements, negotiated with state officials and introduced Botha and Block to his client.
“Breda was responsible for the day-to-day affairs and represented the company at all relevant times, until his death in 2009. The company, Scholtz and external shareholders must now suffer the consequences, due to his conduct.”
Van Zyl added that Scholtz had started up the business venture in the Northern Cape to uplift previously disadvantaged persons.
“Since the death of his first wife, he has contributed massively towards stem cell research. He employs 130 people, including contractors who are involved in the maintenance and administration of the buildings.”
He indicated that Scholtz was liable to pay R14.4 million, including interest, to the liquidators and South African Revenue Service.
“In essence, he will have to pay R85 million in the name of the company, should the confiscation order of R60 million be implemented. Creditors and third parties will have to be paid out their shares through the sale of the fixed assets.
“My client was lured into the situation and had limited involvement. In effect, only a R6 million profit was made and this will act as a deterrent against anyone repeating such an offence.”
Van Zyl added that should his client be granted correctional supervision, he was willing to assist non-profit organisations and the underprivileged and would train people in business. “He has made a meaningful contribution to society.”
Senior State Advocate Peter Serunye maintained that there were no substantial or compelling factors to convince the court to deviate from the prescribed minimum sentence of 15 years’ imprisonment for both Block and Scoltz.