SARS goes for the jugular

2013-04-13 00:00

THE taxman wants his pound of flesh from alleged Ponzi scheme mastermind Barry Tannenbaum — and in this case it equates to nearly R750 million.

The South African Revenue Service (SARS) put together a task team and took two years to trawl through the financial records of Tannenbaum, a Moneyweb investigation has revealed.

SARS enjoys priority status among creditors in insolvency matters and gets first bite at the scraps.

Tannenbaum raked in R12,5 billion over three years in his investment scheme, which promised high returns to investors. When his empire began to crumble, he and wife Deborah fled to Australia in 2007, leaving behind a line of frustrated creditors, said Moneyweb.

His estate was sequestrated two years later and that’s when SARS set about getting its pound of flesh.

And yesterday, a notice in a Durban newspaper advertised the auction of a plot of land in Port Edward, linked to Tannenbaum’s estate.

The ground, measuring about 726 square metres, is located in the luxury Caribbean Estates eco-development in Port Edward, just five minutes from the Wild Coast Sun. The estate’s website advertises the land for R650 000 or “any reasonable offers”. The levy is R1 122 a month.

James Galloway of Tannenbaum’s liquidators KPMG said only that the auction was being held in agreement with the landowner, a Mr Miller, who had ceded the plot.

Galloway referred further queries to insolvency law firm, Brooks & Brand Inc, who also chose not to comment.

The auction takes place next Saturday on site and is being handled by Ian Wyles Auctioneers and Appraisers. In comparison, SARS is aiming much higher and according to Moneyweb, handed KPMG an 11-page letter comprising 17 A4 spreadsheets of calculations supporting their claim.

In short, SARS says Tannenbaum under-declared his income between 2004 and 2009 by R444 770 202.

Penalties, additional taxes and interest added another R300 million to the bill, said Moneyweb.

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