Diamond Africa E12m idling without claims
MBABANE – Investors of the now defunct Diamond Africa Scheme have one week left to claim their money from PricewaterhouseCoopers Advisory Services (Pty) Ltd.
PricewaterhouseCoopers Advisory Services (Pty) Ltd was appointed by the Central Bank of Eswatini (CBE), in terms of the Financial Institutions Act No. 6 of 2005 as the liquidator of Diamond Africa (Pty) Ltd. They said over 2 000 investors were expected to make claims and some have not appeared to date. PricewaterhouseCoopers Advisory Services (Pty) Ltd gave notice of the schedule of steps they proposed to take as liquidator to pay out claims and wind up the scheme. They said such shall be available for inspection at Mountain View International Hotel January 30, 2023 to February 17, 2023 week days.
“Claimants are required to bring proof of identification for verification purposes, If any depositor or other interested party wishes to object to any step proposed, he or she shall file an objection to the proposed step with the High Court within 21 days of the filing with the court of the schedule of steps proposed to be taken by the liquidator,” mentioned PricewaterhouseCoopers Advisory Services (Pty) Ltd.
About 2 000 investors who contributed over E12 million into the account of
Diamond Africa (PTY) Limited stand to share that amount of money.
This comes after the CBE filed an application at the High Court in 2010 ,where it wanted to wind up the company and take possession of its assets. After taking possession of such assets, the bank states, through its liquidator, it would take steps towards the distribution of the assets of the company.
Diamond Africa (PTY) Limited faced being wound up after it was declared to have been operating an illegal pyramid scheme, which took deposits from members of the public without authorisation from the CBE.
The bank instructed PricewaterhouseCoopers Advisory Services (Pty) Ltd as the liquidator of the alleged pyramid scheme after the bank realised that it carried out deposit taking without authorisation.
Affidavit
Through the affidavit filed by PricewaterhouseCoopers Advisory Services (Pty) Ltd, the company was appointed as the liquidator on April 2, 2009 after the bank had seized and frozen the bank accounts of Diamond Africa.
PricewaterhouseCoopers Advisory
Services (Pty) Ltd said “Deposit-taking is a regulated activity and requires authorisation from the Central Bank and failure to obtain such authorisation entitles the bank to seize and take possession of any funds or assets of the person engaged in such activity, with a view to appoint a liquidator to commence proceedings for the compulsory liquidation of the entity engaged in the deposit-taking activity.”
PricewaterhouseCoopers Advisory Services (Pty) Ltd further mentioned that they instituted proceedings before the court, where it sought for orders authorising entry into the premises of Diamond Africa and also to search residential premises of one Arlindo Tembe, the Director and Promoter of the scheme run by Diamond Africa.
Search
During the search, PricewaterhouseCoopers Advisory Services (Pty) Ltd stated that the property belonging to the company was attached and further investigations to the operations of the company were carried out.According to PricewaterhouseCoopers Advisory Services (Pty) Ltd, the investigations revealed that Diamond Africa promoted and facilitated membership of a scheme known as Diamond Trading Programme, which is run by a Canadian company known as Canadian Diamond Traders (CDT).“Diamond Africa was an agent of CDT and received a marketing fee for recruiting investors on behalf of CDT. In addition, Diamond Africa also charged an administration fee which was deducted from the deposits made by the investors. An investor was required to invest a sum of E3 796 in order to participate in the scheme, which the amount was paid directly to CDT. Diamond Africa would charge a sum between E900 and E1 300 as an administration fee,” MacPhail says.
PricewaterhouseCoopers Advisory Services (Pty) Ltd gave a detailed account of how the scheme operated from the level of a miner to that of a collector. At the time of the seizure of the company’s accounts, investors were paying approximately E4 800 as an investment fee and the returns on the investment were purported to be E25 550 in cash plus a diamond.PricewaterhouseCoopers Advisory Services (Pty) Ltd states that this operation was illegal in that it was in contravention of the Mining Act No.5 of 1958 which states that “…no person shall export or import any diamond unless he holds a permit to do so issued by or under the authority of the commissioner of mines. The company neither had the licence to acquire diamonds nor the permit to import or export diamonds.” PricewaterhouseCoopers Advisory Services (Pty) Ltd continued to say that the company also contravened exchange control regulations, by sending the deposits out of the country with the intention of converting to foreign currency. They concluded by mentioning that the business of Diamond Africa could not be undertaken without violating the law, and most importantly, the respondent was operating a pyramid scheme which by its nature is illegal.