Monday, October 18, 2010

Fraud case lodged against Sharemax's Zambezi scheme

Fraud case lodged against Sharemax's Zambezi scheme
October 18, 2010

By Roy Cokayne

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A criminal case has been opened at the Brooklyn police station in Pretoria related to the Zambezi Retail Park property syndication scheme marketed by Sharemax Investments.

Brigadier Andre Wiese, Brooklyn police station commander, confirmed last week that a case of fraud had been opened and subsequently been transferred to the commercial crimes unit in Pretoria.

Pierre Hough, the managing director of Chase International, said on Thursday that he had opened the criminal case on behalf of one of his clients.

Hough also lodged a claim with the Fidelity Fund of the Law Society of the Northern Provinces after Sharemax's attorneys, Weavind & Weavind, failed to respond to a demand to repay his client's R200 000 deposit paid into their account.

In an affidavit, Hough claimed that theft was committed by Weavind & Weavind of the money, and that there was fraudulent non-disclosure and misrepresentation in the Zambezi Retail Park prospectus.

Sharemax and Weavind & Weavind did not respond to several requests for comment.

Hough said his client's funds appeared to have been withdrawn from the trust account soon after they were deposited and prior to the transfer of the property.

A Department of Trade and Industry (dti) notice on property syndications issued in 2006 in terms of the Consumer Affairs (Unfair Business Practices) Act of 1988 prohibits the withdrawal of funds from a trust account before the properties have been transferred to the syndication vehicle.

Neither Zambezi Retail Park nor The Villa had been transferred to the syndication vehicle specified.

Sipho Tleane, the director for legal support and prosecutions in the consumer and corporate regulation division of the dti, said the division had not received any complaints about the alleged contravention by Weavind & Weavind but if it did, it would be referred to the SAPS.

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