Legal Articles and Guides

A KZN couple has been ordered to repay R862 000, which was deposited into its accounts because of a FNB app ‘malfunction’. KZN High Court (Pietermaritzburg) Judge Trevor Gorven – in a concurring judgment – said the story proffered by Sicelo and Nikita Khopho that they had returned the money, in cash, to a bank manager who had since died was ‘highly improbable’.

The appointment – announced late yesterday – of Edward Kieswetter as the new SARS Commissioner, with effect from 1 May, has already run into controversy, with the EFF, strong supporters of axed Commissioner Tom Moyane, threatening legal action.

A proposed law allowing SOEs to establish banks passed the penultimate hurdle yesterday before being sent to President Cyril Ramaphosa for signature and promulgation, says Business Day. The National Council of Provinces (NCOP) Select Committee on Finance adopted the Financial Matters Amendment Bill, which contains the enabling provision for state-owned banks.

Emerald van Zyl, a usury expert, has his sights on Standard Bank, which he claims has over-stated its financial statements by as much as R2bn since 2009 through a R50 a month admin charge that was declared illegal by the SCA in 2013.

Tycoon Roux Shabangu has expressed fear he could be bankrupted if he pays back a portion of the millions of rands that was irregularly lent to a liquidated company he co-owned. Denying that he and eight others were liable to repay the state-owned Land Bank R82m arising from a loan granted to Westside Trading 570 in 2006, Shabangu has taken the long-drawn-out legal battle to the Constitutional Court.

The EFF has called for a judicial commission of inquiry with financial forensic capacity into alleged discriminatory practices by banks against black people, says a TimesLIVE report. This follows revelations of alleged racism against black homeowners by FNB that were broadcast on Sunday by the SABC's Special Assignment – allegations flatly denied by FNB. 

Lenders and the University of Stellenbosch’s Law Clinic, joined by Summit Financial Partners and a number of clients, are to lock horns in the Western Cape High Court in the middle of the year. A Moneyweb report says the case will decide what charges lenders are allowed to load onto the accounts of defaulting borrowers.

A forensic investigation has revealed about R80m said to have been illegally invested in VBS Mutual Bank by rogue officials at the state-owned Community Schemes Ombud Service (CSOS) was actually deposited into an FNB corporate cheque account belonging to the now-insolvent bank, says a Mail & Guardian report.

The KZN High Court (Pietermaritzburg) has found the Reserve Bank’s intervention into the affairs of Sharemax Investments was the cause of the R5m loss by an investor in one of the company’s schemes and not any breach by an investor's financial adviser.

Borrowers with more than one debt outstanding were given some protection last week when the SCA ruled that the interest rate on short-term loans after the first loan cannot exceed 3% a month. GroundUp reports Micro Finance SA (MFSA) had challenged regulations promulgated under the National Credit Act reducing the interest rate on a second short-term loan taken out in a 12-month period from 5% to 3% a month.

The Equality Court is to hear a case alleging discrimination by a bank – the first time such a case has come before this court. Cape Town-based usury expert Emerald van Zyl has taken his nearly 10-year fight against alleged banking abuse to the Cape Equality Court, seeking a ruling that FNB’s FirstRand Finance Company discriminated against more than 4 000 black customers by charging them 30-40% more than white customers on their mortgage loans.

The battle by companies to profit from social grants rages on with another round of court action, this time between Sassa and another Net1 subsidiary, which will be heard today. According to a Mail & Guardian Online report, the Net 1 subsidiary, Moneyline Financial Services, is asking the Gauteng High Court (Pretoria) to compel Sassa to accept the consent forms – confirming bank accounts into which the social grants should be paid – of beneficiaries through Cash Paymaster Services (CPS).

The JSE censured Pepkor and fined it R5m yesterday for failing to tell its shareholders that it stood surety for R15bn of Steinhoff International’s debt, and about its loans to senior management. Pepkor issued a separate statement saying it ‘has acknowledged that inadequate disclosures were made during the process of its listing and the publication of its annual financial statements in 2017’, notes a BusinessLIVE report.

African Bank’s BEE shareholders have applied for leave to appeal against the recent dismissal by the Gauteng High Court (Pretoria) of its legal action against former CEO Leon Kirkinis, his fellow board members and Deloitte. A Business Day report says the case could set legal history by enabling shareholders to sue directors and auditors.

The liquidation of VBS Mutual Bank will allow criminal and civil proceedings against those responsible for its demise to pick up pace, and will allow for the recovery of money from those who looted or owed the bank, says a Business Day report. The Gauteng High Court (Pretoria) yesterday granted an order for the liquidation of VBS after an application by the SA Reserve Bank's Prudential Authority was unopposed by respondents, which includes the bank and the Minister of Finance.