Axiam Capital Management is preparing to lay charges against Craig Warriner, the fund manager and trustee of BHI Trust, “for illegally using its credentials”.
Just over two weeks ago, Warriner handed himself over to the authorities in Sandton. He allegedly admitted to using the trust’s funds in a highly irresponsible manner, referring to it as “using the funds of Peter to pay Paul”, a practice that allegedly began after the 2008 global financial crisis.
Read: BHI Trust: The walls start tumbling down
On 25 October, the trust was placed under provisional sequestration by the High Court in Johannesburg.
In the founding affidavit (dated 20 October) deposed by Cawood Attorneys (an investor in the trust) in support of the application for the provisional sequestration order, Werner Cawood named Warriner as an authorised representative of Axiam. Annexures attached to the affidavit – documents detailing the trust’s “investment strategy conditions” – named Axiam as the trust’s investment manager.
Colin Huber and Grant Dykes of Axiam, a specialist fund manager based in Somerset West, last week released a statement saying they only became aware through these same court papers that Warriner was fraudulently using their company’s credentials, as well as its Financial Services Provider number, in “various types of documents”.
Although they confirmed that Warriner had been appointed as an authorised representative of Axiam, Huber and Dykes stated that Warriner had no agency (was not authorised) to initiate or conclude any investment mandates on the company’s behalf.
“He had no agency to conclude any contracts whatsoever on Axiam’s behalf. As an employee, he had no access to client accounts,” the statement read.
Huber and Grant added that, in the past 10 days or so, they have been working with their legal team, gathering evidence, to lay charges against Warriner for illegally using their credentials.
The company also suspended Warriner and removed him from its licence.
“We are taking disciplinary action against him. Furthermore, we have started debarment proceedings against him. Our investigation into Warriner’s fraudulent action is ongoing.”
As far as Moonstone can determine, Axiam briefly crossed paths with BHI Trust in the early 2010s when the trustees, Warriner and Christian Ashcroft, procured the services of the specialist fund manager. Shortly afterward, the trustees of BHI terminated their investment management mandate with Axiam on 6 February 2013.
‘Significant sum’ involved
A media statement issued on behalf of Cawood Attorneys last week stated that, at this stage, there were no actual figures as to what BHI was worth “either before or after the circumstances that led to Mr Warriner handing himself in”.
“However, based on the private and confidential discussions with other investors who have approached Cawood Attorneys to assist them in the process of registering their claims against the trust, it is determined this sum is significant,” the statement read.
Huber and Dykes said Axiam never invested in BHI Trust. They added they were not part of marketing, soliciting, accepting, managing, administering, and pooling money or funds or deposits and processing these from members of the public in respect of the BHI Trust.
“None of our clients have experienced losses because of Warriner’s fraudulent actions. Our clients have 24-hour access to their accounts, as their accounts are held in their own names at reputable, accredited institutions.”
FSCA investigation
Warriner, who is the subject of investigations by the National Prosecuting Authority (NPA) and the FSCA, is being held in police custody, with his next court appearance set for 29 November.
Last week, the FSCA told Moonstone that the Authority was working with the criminal prosecution authorities and would assist them in any investigation or prosecution they may pursue.
Read: Complaints lodged against BHI Trust date back six years
The Authority confirmed it was investigating the activities of the trust and the possibility that it was conducting unauthorised FSP business and unauthorised collective investment scheme (CIS) business. It confirmed that none of the parties under investigation was authorised as FSPs or licensed as CIS managers.
The FSCA said the investigation had been extended to other aspects of the operations of the investigated parties and to additional entities and persons.
“The FSCA has also launched an investigation into licensed entities that may have advised clients to invest in BHI products,” the FSCA said.
“The FSCA has also launched an investigation into licensed entities that may have advised clients to invest in BHI products,”
This is going to be an interesting can of worms!
It would also be interesting to see the “un-licensed entities” that advised clients to invest with BHI. It appears there are a fair amount of these out there. Does the FSCA have any regulatory bearing over these?
Reaching out to clients of TCF Investment Consulting who have invested in BHI Trust. Would you have an interest in participating in a group of the aforementioned FA’s clients in order to share information, experiences and ideas in the pursuit of getting your funds back?
As a client of CFS and as an Investor in BHI, i would be interested in participating ina group of I terested clients
As scammed investors through TCF we would be interested in sharing information with other affected persons.
Thank you.