Slap on wrist for CEO mystery debt

ACTING CEO of the Eastern Cape Development Corporation (ECDC) Reggie Naidoo looks set to walk away with a slap on the wrist for R124 000 in outstanding debt his company owes ECDC.

Naidoo was adamant he owed nothing as his loan was settled in 2005, although there was no evidence to back his claim.

The original loan was R700 000 and was meant to be settled in 2005, but it went into arrears, accumulating more than R1-million in charges and interest.

The Daily Dispatch early last month exposed Naidoo’s company, African Integrated Treasury Solutions (AITS), as one of more than 300 ECDC clients, including high-profile and politically connected businessmen, whose loans totalling R118-million, were written off in 2012.

This was the same year Naidoo was appointed as an ECDC board member. On his appointment, Naidoo did not declare his loan, which was meant to be settled in 2005.

The Dispatch has seen a memorandum in which ECDC recommended on Naidoo’s behalf that he only pay R31 000 of R124 582 owed by his company “in good faith”.

“The debtor [Naidoo] is adamant that the cash payment of R200 000 paid to ECDC on September 8 2005 was in full and the final settlement of the loan.

“This was apparently communicated to an ECDC loan officer who is no longer in [the] employ of ECDC,” debt collection specialist Arnold Meiring said in the memo.

However, evidence shows that debt collectors had continued to chase after Naidoo until 2008 without success.

Another debt collector appointed in May 2012 sent a letter of demand and visited the Waverly Warehouse address in Chiselhurst, but no one at the address knew of AITS.

“There was no copies of contracts or other information and we were not able to proceed,” XPS Collectors said in a letter dated September 30 this year.

Despite ECDC’s own admission that it cannot locate a signed memorandum recommending that Naidoo’s loan be settled after the R200 000 payment, a recommendation to the corporation’s Development Investment Committee (DIC) has been submitted that he pay only R31 000 of the debt.

ECDC has consistently declined to comment on Naidoo.

“Matters relating to Reggie Naidoo are still under investigation. ECDC will advise the media once all these processes have been finalised,” ECDC spokeswoman Nopasika Mxunyelwa said. —