THE mCUBED CONNECTION
mCubed complained to the Financial Services Board (FSB), but the FSB sent mCubed packing and told the company that what it was doing was illegal.
Standard Bank was also perturbed about:
The way in which mCubed took money offshore via its life licence and then invested in units in noncompliant offshore hedge funds registered in the Cayman Islands. The units were incorporated into the mCubed local portfolios. They were not registered in the name of the trustee, Standard Bank.
The sale of mCubed life assurance was blocked by the Reserve Bank and the FSB some years later because of these transactions, and mCubed was penalised for contravening exchange control regulations.
Regular unreconciled amounts on mCubed portfolios at month end.
The result was a meeting with the then managing director of mCubed unit trusts, Chris Rogers, who was previously involved in the launch of the Absa Fund Managers money market fund. At the meeting, he fired Standard Bank as the custodian. The new custodian was Absa. At the time, Personal Finance also revealed that mCubed was paying secret kickbacks to financial advisers to induce them to place client money in mCubed funds.
And, in their second report, the CMM curators say that the South African Revenue Service is asking the curators for R1.4 billion, which, it is suspected, “… arises out of a transaction between mCubed, Specialised Insurance Solutions Trust (Mauritius), a Mauritian citizen and CMM”.
The curators say the nature of the transaction will have to be investigated, with the money trail being followed through bank accounts and by perusing documents from mCubed, counter-parties and interested parties.
And the final twist in the tale was that Bakkes got to open his unit trust fund again, thanks to mCubed, which provided him with its FSB collective investment scheme licence to allow Bakkes to operate what is called a white label fund under its auspices!