Markus Jooste appeals to Tribunal against R241 million administrative penalty

Markus Jooste appeals to Tribunal against R241 million administrative penalty

Netwerk24 reports that Markus Jooste’s legal team holds that the FSCA’s R241 million penalty is shockingly inappropriate in that he is also held accountable for the transgressions of those he advised to sell their Steinhoff shares days before the implosion of the conglomerate.

In addition, the FSCA did not take into account that he was unemployed and did not benefit from the insider trading, according to Nellie Brand-Jonker, who has reported extensively on the Steinhoff issue from the start.

Jooste was fined R161m in his personal capacity, and jointly and severally a further R80m with those implicated in the matter.

Of the parties involved, only the family trust of the late Ockie Oosthuizen, Ocsan Investment Enterprises, also approached the Tribunal to have the decision by the FSCA reviewed.

According to the FSCA, Ooshuizen sold his and his children’s shares within 20 minutes of receiving a text message, allegedly sent by Jooste. Counsel for Ocsan held that he had been contemplating selling his shares for some time.

At the heart of the appeal is an SMS allegedly sent by Jooste to the relevant parties, advising them to sell their shares.

Jaap du Toit, a founder member of PSG, testified that he received the SMS, but ignored it, as it contained nothing that he did not already know. Despite a request in the SMS to delete it, he saved a screen shot of the text message. Jooste’s legal team have indicated that the message may have been tampered with.

Advocate Gilbert Marcus, acting for the FSCA, listed a number of issues to vindicate the finding by the FSCA that Jooste was involved in insider trading.

Among other things, Marcus contends that on 30 November 2017, the day on which the alleged text messages were sent, Jooste became aware that Deloitte would put the signing-off of Steinhoff’s annual statements on ice.

We trust that the Tribunal will also rule on the quantum of the penalty, both in terms of Jooste’s own, as well as those of the others implicated in this matter.

Calculation of administrative penalties

This has always been shrouded in mystery, leading to questions being asked about fairness, equity and justice. We took this up with the (then) FSB as far back as October 2013, and published an article titled Enforcement Committee Sanctions, which contained three examples of what appeared to be different strokes for different folks. We also published this response by the FSB to our questions:

“The appropriateness of an administrative sanction depends on the specific facts and circumstances relating to a specific contravention. Accordingly, matters referred to the Enforcement Committee by the Registrars of the Financial Services Board (including the Registrar of Short-term and Long-term Insurance) are assessed on a case-by-case basis. When considering the appropriateness of the administrative sanction, the Registrar concerned takes into account, inter alia, the factors referred to in section 6D(3) of the Financial Institutions Act 28 of 2001 (FI Act) which could serve as either mitigating or aggravating circumstances.”

In another matter involving a leading life office that had breached the principles relating to conflicts of interest and remuneration contained in Directive 159.A.i (LT & ST), which sets out the requirements that insurers must comply with when outsourcing an aspect of their insurance business to another person, the regulator noted in a media release:

“No enforcement action in the form of a financial penalty will be instituted against ‘ABC’ in light of the technical nature of the breach and the co-operative manner in which it has undertaken to immediately correct the breach.”

No wonder there were mumblings of low-hanging fruit from those lower down the pecking order.

Law and order

Oh, for the days when justice was simple.

A reader recently sent me the following anecdote following an article on how people who were blatantly dishonest were protesting their innocence, often grasping at religious straws to strengthen their case.

Accused: “The Lord is my judge. I am innocent.”

Judge: “He is not. I am. You are not.”


Disclaimer: The views expressed in this article are those of the writer and are not necessarily shared by Moonstone Information Refinery or its sister companies.

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One Response to Markus Jooste appeals to Tribunal against R241 million administrative penalty

  1. Wayne Fouche 11 November 2021 at 2:10 pm #

    Hi Paul

    It is quite incredible that Marcus Jooste stands there with a straight face to “defend” his innocence.

    A trip to Germany would be the ideal solution for him.

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