End of the road for 'two-cheque' lawyer

By Fatima Schroeder Time of article published Nov 4, 2003

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Former Athlone attorney Hoosain Mohamed, who pleaded guilty on Monday to defrauding 227 clients out of more than R6,7-million in Road Accident Fund (RAF) money, is expected to spend six years behind bars.

Mohamed, of the law firm H Mohamed & Associates, also has to pay the state R8,59-million in terms of the Prevention of Organised Crime Act.

As part of his plea bargain with the state, he has implicated an RAF official in an affidavit.

Mohamed was taken through to the Malmesbury Prison where he began serving his sentence on Monday.

Last month his former partner Ahmed Chohan, pleaded guilty to defrauding clients of about R1-million in RAF claims and was sentenced to seven years' imprisonment of which four years were suspended for five years.

Chohan also agreed to pay R5-million.

The state has withdrawn charges against one of Mohamed's employees, Michael Mulligan.

Mohamed was admitted as an attorney in May 1975 and specialised in pursuing the claims of accident victims against the RAF.

In September 1999, the Cape High Court granted an application by the Cape Law Society to strike Mohamed's name from the roll of attorneys after they contended that he had defrauded his clients by using a strategy known as the "two-cheque system".

In his plea agreement with the state, Mohamed admitted to using the two-cheque system.

He said he lodged claims on behalf of his clients with the RAF, which settled the claims by paying the money into the trust account of the firm of which he was a partner.

He did not inform his clients of the extent of the payments and deposited some of the monies - about R6,7-million - into his personal bank account without the knowledge or consent of his clients.

His accounting records, however, indicated that the claims were paid out to the clients.

Mohamed also admitted he had misled the Cape Law Society into believing that he kept proper records for the firm's trust account and that he paid the full amounts due to his clients.

He also pretended that the fees that the firm charged were in accordance with the guidelines of the law society.

In doing so, he induced the law society to issue him with fidelity fund certificates that enabled him and the firm to practise as attorneys.

Mohamed has no previous convictions.

The plea agreement said the state estimated that the matter would run over three months.

The agreement also noted that Mohamed, 63, had angina and high blood pressure and these conditions had been aggravated by the case.

Mohamed was sentenced to 10 years' imprisonment, of which four years were suspended for five years, on condition that he was not again convicted on charges of fraud or theft and that he gave his full co-operation to ensure his offshore assets and funds were repatriated to South Africa.

Appointed curator Stephen Powell, of Deloitte & Touche, said he would publish a list of Mohamed's victims and urge them to come forward.

He said he was attempting to repatriate $500 000 from a bank account in Switzerland.

He had repatriated more than R7-million in the case against Chohan from an attorney in London.

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