Don’t touch me on my sig­na­ture

Finweek English Edition - - INSIDE -

EX­POSé

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.”

é EX­POS

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

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