Don’t touch me on my signature
The Council for Medical Schemes (CMS) is offering insurer Selfmed an ‘out’ after an apparent signature bungle has left the group exposed to some tough questions. Finweek is in possession of signed certifications of return for the scheme’s financial statements for the financial year end 2012 and the period ending June 2013, which were submitted to the council.
Former Chairperson of the scheme Barry Reide and trustee Dr Willem Boshoff both resigned from the scheme on 29 June 2013, pending an inquiry into alleged irregularities. Before resigning, the pair signed off on the scheme’s full year 2012 financial statements, as per Section 37 of the Medical Schemes Act.
A bizarre thing happened, however, on the scheme’s financial statements for the first six months of 2013, which were signed off in September. The statements show that Reide and Boshoff were still among the signatories three months after they had vacated their positions.
An even stranger thing is that their signatures were now explicitly different from before.
An inquiry into how and why their names and (different) signatures still appeared on t he scheme’s f i nancial documents yielded a surprising outcome. Both categorically denied ever signing any documentation or granting permission for any other person to sign on their behalf after they had resigned from the scheme.
What you have here is a serious case of fraud and corruption, the two told Finweek.
Interim principal officer of the scheme Brian Kleinsmith confirmed to Finweek that both had resigned. When asked why their names still appeared on the scheme’s financial statements three months after their resignations, Kleinsmith simply answered: “There was no time to change their names.”
When Finweek questioned this, he responded: “Go to the council if you think there is a story here, p e o pl e were s i mply instructed (by the council) to sign and submit the documents.” Kleinsmith made it clear that this was his final comment on the matter.
In a written response to Finweek, Dr Elsabe Conradie, stakeholder relations head for Selfmed, said: “The council fully concur that someone cannot sign on behalf of someone else without their permission, but in terms of CMS processes any trustee can sign the return. They would obviously have to change the name on the return. If this cannot be done electronically for whatever reason, then it should be done manually on the return.”
According to Section 38 of the Medical Schemes Act, the Registrar may reject returns if they are of the opinion that any document furnished in terms of Section 37 does not comply with any of the provisions of this act.
Conradie further wrote: “CMS does not keep track of trustees’ signatures but in this instance the statutory returns were accepted in good order and standing based on the resolution from Selfmed. Accordingly, CMS believes that the concerns raised when viewed in the context provided, regarding the signature of these documents, does not provide material grounds for any concern.”
Werksmans Attorneys Director Neil Kirby said that while he appreciates the position of the council on this matter, its rationale for not being concerned about the particular issue of signatures is still miss- ing. “The CMS needs to explain why it is not concerned about the application of signatures to official scheme documents when the signatories are not off ice bearers of the scheme.”
Boshoff said he wrote to the CMS last year to inquire about how his name was still used in the schemes financials as it fooled members into thinking that he was still their trustee. He explained that the council had only asked him how he was in possession of such documents as he was no longer in the employ of the scheme, adding that nothing had been done about his complaint to date.
“The council will not do anything about this because it suits them to destabilise Selfmed so that it can lose members because they want to amalgamate it and take the members’ monies and give it to another scheme,” said Boshoff.
Selfmed is a self-administered open medical scheme. As at December 2012, it had 8 589 members with a little under R320m in members’ funds. The scheme’s solvency level stood at 118.2%, well above the industry average of 32.6%. A high solvency ratio suggests a well-run scheme.
Boshoff said that the members will be on the losing side if the scheme was to be merged with another because it is likely that the other scheme would have no