The Financial Sector Conduct Authority (FSCA) has imposed a R122.9m fine on Markus Jooste for insider trading on the day of the collapse of the Steinhoff share price in December 2017 when admissions of ‘accounting irregularities’ and his sudden resignation came to light, but there's every reason to believe he will appeal the matter, possibly all the way to the Constitutional Court, which would drag it out for years.

The FSCA’s divisional executive for investigation and enforcement, Brandon Topham, made the announcement on Friday as part of total administrative fines of R241m levied on Jooste and three other parties, says a BusinessLIVE report.

Jooste never traded a single share and made no money, but is responsible, jointly and severally, for sending information on 30 November 2017.

Jooste warned four people that it would be in their best interests to sell their shares in the global retailer immediately and at any price just six days before Steinhoff announced his immediate resignation as well as an investigation into accounting irregularities.

Steinhoff’s shock announcement sent the share price into free-fall. In the ensuing days, the company lost 95% of its value, incurring hundreds of billions of rands’ worth of losses.

Jooste is also jointly and severally liable for a further amount of R38.6m with one of the parties that traded on his information – Ocsan Investment Enterprises, whose sole director, the late Ockie Oosthuizen, the former Springbok prop, was ‘a long-time acquaintance of Mr Jooste’.

Ocsan was separately fined R77.2m, notes BusinessLIVE.

The two other parties fined for acting on the information Jooste supplied are Dr Gerhardus Burger, who, on receiving the warning from Jooste, sold his entire Steinhoff shareholding held through two family trusts. Burger was fined R3m.

The FSCA also imposed a fine of R18 328 on Jooste’s former driver, Marthinus Swiegelaar.

If the three individuals do not pay their fines, Jooste is liable for the additional amounts of R38m plus R18m, making the SMS he sent to them probably the world’s most expensive SMS, observes a Daily Maverick report.

It says this is the largest penalty imposed by the FSCA for insider trading – the next largest is the R24m it fined Deutsche Bank in 2019.

BusinessLIVE notes the FSCA initially reviewed trading in 60 accounts in the days leading up to Steinhoff’s bombshell announcement.

Eight warranted closer attention and, in addition to Friday’s announcement relating to the three parties, the FSCA said it is investigating a further four accounts.

Full BusinessLIVE report