
The South African Federation of Trade Unions (SAFTU) receives with delight the news of the arrest of the former Chief Financial Officer (CFO) of Steinhoff International, Ben la Grange. This arrest comes almost three months after the chief engineer of Steinhoff’s corporate fraud, Markus Jooste allegedly killed himself.
La Grange is reportedly charged with “two counts of racketeering, five counts of fraud, one count of corruption and three counts of the contravention of the Financial Markets Act.” He joins the former legal head at Steinhoff, Stéhan Grobler, who was arrested in March and is out on bail.
La Grange, the late Markus Jooste and other executives engaged in fraudulent activities that precipitated the abrupt collapse of Steinhoff Stock, leading to the evaporation of the value of all investments.
In this corporate crash, Steinhoff stock lost 91% (others estimate 98%) in value, wiping about R210 billion. The stock included R20 billion from the pensions of workers through the Public Investment Corporation (PIC) which declined in value to R3,5 billion. The PIC has lost doubly in the Steinhoff crash because it had acquired shares directly, and also had shares in holding companies that acquired shares such as Pepkor.
In the unfolding of the Steinhoff saga in December 2017, SAFTU demanded “no stone” to be “left unturned to prosecute and punish those who have broken the law in all these companies.” Further, we remarked that corporate crimes “are not victimless crimes.” The losses to the stock acquired through workers’ pensions are clear testimony that these crimes are not victimless.
Like they attached Jooste’s assets in 2022, assets of the individuals such as la Grange and Grobler must also be attached. Their assets are a tip of the island compared to the stock wiped in value when Steinhoff crashed, and to request the attachment of their assets does not begin to atone for the damage they have caused.
It is also surprising that the commercial banks have not closed their banking transactional accounts for “reputational damages.” These same banks are trying to drive Sekunjalo out of Business by closing their transactional accounts citing reputational damage because of the loans received from PIC by Sekunjalo and Independent Media. Yet, the banks still associate with people who evidently engaged in corporate fraud.
SAFTU demands a speedy prosecution and the eventual sentencing of la Grange and Grobler, including those executives who have not been arrested yet. The final sentences should not be reducible to fines but should be time served in prison, in addition to attaching their assets.