No holds cash war

2011-09-24 10:26

The heads of Nafcoc’s financial arm, Nafhold, have controversially awarded themselves and trust funds linked to them more than R110 million.

Nafhold’s chief executive Michael Leaf and chairperson, Johannes Hlongwane, say they deserve the money as it is a return on their investment while their detractors accuse them of “stealing” from the National African Federated Chamber of Commerce.

Bank statements of Nafhold, which are in the possession of City Press, show that Leaf became a mouth-watering R59 million richer while Hlongwane pocketed R47 million last December. In addition, Nafhold paid R3 million to M Leaf Trust – which belongs to Leaf – while Hlongwane’s Entabeni Trust got R2.8 million.

The information is documented in Nafhold’s First National Bank (FNB) business cheque account.

Nafcoc president Lawrence Mavundla this week said he was disappointed with Leaf and Hlongwane’s conduct.

“As Leaf is an accountant and Hlongwane a bishop of the International Assemblies of God, I trusted them a lot,” he said.

“I even stood by them and conducted media interviews in their defence, when my predecessors Patrice Motsepe and Buhle Mthethwa accused them of dishonesty,” he said.

He said that when he confronted the two directors about the dividends, they told him that he should keep quiet because he lacked sufficient intellectual capacity to interpret the bank statements.

“Nafcoc has handed the matter over to the Hawks and Asset Forfeiture Unit and we hope they will pounce on these two,” he said.

A fuming Leaf – who also spoke on behalf of Hlongwane – this week defended the dividends.

He said they received the money because Leaf held a 7.3% stake and Hlongwane 6.2% in Nafhold’s R1.2 billion worth of shares in Tsogo Investments Holding.

A forensic report conducted by auditing firm Deloitte & Touche in 2003 shows that Leaf held 2.6% and Hlongwane 1.4% ordinary shares.

Leaf said their shares increased in percentage after they each exercised their 5% share options.

“We were given the share options in 1999, we exercised them in 2006 and took ownership of the shares last year,” he said.

Leaf said he contacted FNB about the publicising of the bank statements and was informed that the financial institution was forced to provide the documents after they were requested by an official from the Commercial Crimes Unit.

He said he would complain to the unit about the conduct of one of its investigators which resulted in the bank documents landing on Mavundla’s lap.

“It is concerning to us that such confidential information could arrive in the hands of Mavundla who then tries to embarrass us, when everything that we have done is above board,” said Leaf.

“Hlongwane and I deserve the shares because we built Nafhold from scratch, invested our own money and even used my house as surety.

“When we asked some members of Nafcoc to invest R500 a month into Nafhold, they refused and mocked us. And now people want to reap the rewards when seeing that the investment has generated more than R1 billion,” he said.

Leaf accused Mavundla of undermining the spirit of last week’s meeting where both of them were summoned by the stalwarts to explain why their organisations were at loggerheads and, in so doing, damaging the name of Nafcoc.

At the meeting, they agreed to work on finding ways to end infighting.

Nafhold is currently disbursing R1.2 billion to constituencies.

City Press obtained the case number from Mavundla and Leaf.

Hawks spokesperson McIntosh Polela said a case had been opened and is currently being investigated.

Join the conversation! encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

We reserve editorial discretion to decide what will be published.
Read our comments policy for guidelines on contributions. publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Comments have been closed for this article.

Inside News24

Traffic Alerts
There are new stories on the homepage. Click here to see them.


Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.

Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire network.


Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.

Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.