The Financial Services Board (FSB) Enforcement Committee has handed down fines totalling R4 million to two people involved in a “boiler-room” share-selling operation in which investors have lost millions of rands.

The Enforcement Committee can take administrative action against people and institutions that the FSB considers to have contravened the laws it administers.

The FSB accused Advocate George Catsicadellis, who was fined R3 million, and one of his employees, Monica Botha (now Greyvenstein), who was fined R1 million, of running a “boiler-room” operation, hard-selling shares in what was then an unlisted mining exploration company, Platfields Limited.

Catsicadellis, whose financial services provider licence was withdrawn by the FSB in June last year, this week denied he had done anything illegal, and said he will appeal against the Enforcement Committee’s order.

Catsicadellis is currently running Amathuba Amashle, a company that sells precious metals to consumers. He does not have to be registered with the FSB to sell the metals.

The FSB says that from 2008 to 2010 Catsicadellis and his representatives, including Botha, cold-called clients, after randomly selecting members of the public, and advised them to invest in Platfields.

Most of the shares that were sold were owned by Investcare, a Catsicadellis-owned company. Investcare bought the shares for between R1 and R1.50 and then sold them on for between R2 and R3.

The shares of Platfields, which subsequently listed on the JSE, were trading this week at four cents a share. Catsicadellis claimed the loss in value was a result of the 2008 stock market collapse, but, when interviewed this week, he could not explain why the shares have not recovered in value.

In a statement issued this week, the FSB says: “In order to secure sales at inflated prices, Catsicadellis made various misrepresentations regarding fictitious listing dates, listing prices and exorbitant growth projections of Platfields’ shares.”

The Enforcement Committee found that the use of cold-calling was “singularly inappropriate”.