FSCA raid was ‘an intimidation tactic’
Political cabal accused of using underhanded tactics to get inside information on company’s legal strategy
THE Financial Sector Conduct Authority (FSCA) and police swooped on the offices of Sekunjalo Investment Holdings and African Equity Empowerment Investments (AEEI) in Cape Town yesterday and tried to confiscate laptops and computer hard drives.
They claimed they were probing a case of market manipulation against one of businessman Dr Iqbal Survé’s companies, AYO Technology Solutions.
Survé, who is chairman of Sekunjalo Investment Holdings, described the search as a “fishing expedition” and “an intimidation tactic”.
The team went directly to the desk of Survé’s personal assistant, Maude Nyandoro, and demanded her laptop.
Without producing a search warrant, they began downloading information from Nyandoro’s laptop.
However, they stopped halfway through when company lawyers arrived and demanded the legal documents authorising the raid.
Survé, who is also executive chairman of Independent Media, was not in the building when the FSCA team arrived.
However, he arrived an hour later and described the raid as part of an orchestrated political campaign against him and his companies.
A staff member said the raid team arrived just before 9am.
“The first thing they did was to go for Maude’s laptop and started downloading stuff. They said they had a court order but didn’t produce it. That’s why they couldn’t download any more.”
Survé said he would have had no problem giving the FSCA information, had they simply asked for it.
He said the FSCA decided to raid his companies in its probe into share trading, even though AYO was the official complainant in the matter.
“This is a desperate attempt to stop us from publishing the truth. Ironically, it’s Sekunjalo that lodged a formal complaint with the FSCA against certain well-known hedge funds and asset managers that were trying to bring down AYO’s share price,” Survé said.
“Instead of investigating that, the FSCA is being used to intimidate us into submission.”
The raid is the latest in an on-going battle between Survé and multiple state regulatory bodies.
Sources said it was part of an orchestrated move against Survé’s companies for allegedly not “toeing the political line” and due to Independent Media’s publishing of exposés involving key figures in the current administration.
Earlier this year, the Companies and Intellectual Property Commission (CIPC) issued a compliance notice against the board of directors of the Public Investment Corporation (PIC) to recoup the R4.3 billion investment it made into AYO Technology Solutions in 2017.
This move was declared unlawful by North Gauteng High Court Judge Cornelius van der Westhuizen, who dismissed the case with costs.
Survé added that the raid was part of a “concerted attempt by a cabal” to use state institutions and regulatory bodies such as the SA Revenue Service, FSCA, CIPC and even the Financial Intelligence Centre to try and “find something to intimidate us”.
“We’re not going to be intimidated by this blatant attempt to use state institutions to drive a political agenda. We’re reliably informed of clandestine meetings over the past weekend that took place between individuals from these state regulatory bodies and powerful politicians.
“They are frustrated that the Mpati Commission couldn’t find anything irregular and are now using state institutions to go on a fishing expedition to intimidate our companies,” he said.
The businessman described the raid as an underhanded tactic to get inside information on AYO’s legal strategy after the company stated its intent to sue the PIC for billions in damages.
“There’s a huge conflict of interest as the FSCA commissioner is Abel Sithole, who’s also the principal officer of the Government Employees Pension Fund (GEPF). This is an underhand attempt to get the information relating to our legal case against the PIC and the GEPF.”
The FSCA team allegedly intimidated Sekunjalo staff and tried to prevent the media from reporting on the raid.
“They are looking for information that our journalists have relating to corruption which implicates certain politicians. This is effectively an attack on media freedom,” he said.
A lawyer appointed by the court, Zola Mcaciso, said he was present to ensure both parties complied with the court order.
“I’m just here to ensure that the investigators don’t operate outside of their powers and that those who are being investigated adhere to the court order.”
In a meeting between the parties, Mcaciso reassured representatives of Sekunjalo that the information obtained from any of the hard drives would be sealed with the courts until the company launched its own high court application.
In a statement, the FSCA said the raid was conducted as part of an investigation into allegations of prohibited trading practices (market manipulation), in possible contravention of the Financial Markets Act.
It said Western Cape High Court Judge Pat Gamble had granted the order for the search on October 8.
“It allows the FSCA to conduct the search under the supervision of an independent attorney. As a market conduct regulator, the FSCA is mandated to investigate, and in appropriate instances, take enforcement action in cases of market abuse on the financial markets. This is to maintain the integrity of the financial sector by ensuring that all regulated entities, their key individuals and representatives act in the best interest of the South African consumer,” said the FSCA.
THE Financial Sector Conduct Authority raided Dr Iqbal Survé’s offices in Cape Town yesterday and tried to confiscate laptops and computer hard drives.