NEWS & ANALYSIS

Yengeni directorships: DOJ remiss - DA

Tim Harris says convicted fraudster was not placed on CIPRO list

Tony Yengeni's illegal directorships: focus shifts to Department of Justice

The Democratic Alliance calls on the Minister of Justice to urgently explain why they appear to have not complied with the Companies Act in the case of Mr Tony Yengeni.

Today's response by the Department of Trade and Industry (DTI) to a parliamentary question I posed shines the spotlight squarely on the Department of Justice (see below).  Minister Jeff Radebe's department has apparently failed to fulfil their legal duty, thereby allowing Tony Yengeni to illegally hold directorships in several companies for the past five years.

Section 218 of the Companies Act requires the Registrar of Courts to provide the Registrar of Companies with copies of court orders and convictions to trigger the registration on the register of disqualified directors, but the DTI has now confirmed that they did not receive the relevant documents related to Mr Yengeni's case.

I will also consult with the Judge President of the North Gauteng High Court, to establish whether the Court was aware of any failure by the registrar of the court to comply with the act.

Two weeks ago I laid a criminal change against Mr Yengeni for his apparent breach of the Companies Act by retaining directorships despite his fraud conviction.   At the same time I asked a parliamentary question of the Minister of Trade and Industry and one of the Minister of Justice to confirm whether these departments fulfilled their obligations in terms of the Act.

Today's answer from the DTI appears to absolve Cipro, but it now shines the spotlight squarely on the Department of Justice. The Minister must urgently answer the question I posed him so that we can get to the bottom of this affair.

THE NATIONAL ASSEMBLY

QUESTION FOR WRITTEN REPLY

QUESTION N0 3131

Mr T D Harris (DA) to ask the Minister of Trade and Industry:

Whether Mr Tony Yengeni was listed on the register of disqualified directors of the Companies and Intellectual Property Registration Office (Cipro) in terms of Section 218 of the Companies Act, Act 71 0f 2008, after he was convicted of fraud (S v Yengeni 2006 (1) SACR 405 (T)); if not, why not; if so, (a) who was responsible for allowing him to be registered as the director of several companies, (b) what action has Cipro taken to deregister him and (c) what disciplinary actions have been taken against the Cipro agents who were responsible for allowing his registration? NW3931E

Response:

According to Cipro, section 219 (4A) of the Companies Act, 1973 requires the Registrar of the Court to provide the Registrar of Companies with copies of court orders and convictions to trigger the registration on the register of disqualified directors.

Mr Yengeni was not listed on the register of disqualified directors as the Registrar of Companies was not provided with the relevant information. The Registrar of Companies will continue to work with the Registrar of Court to develop and maintain a system that will facilitate the submission of such information to speedily and appropriately allow for listing of necessary individuals on the register.   

(a) According to Cipro, the legislation gives companies capacity to appoint their own directors and register them with Cipro for record keeping.

(b) According to Cipro, no action has been taken to remove Mr Yengeni as the duty to remove him lies with the concerned company or a court with jurisdiction to authorise such a change.

(c) According to Cipro, no action has been taken against any of the Cipro agents at this stage, as the processes of lodging the relevant CM29 form (details of directors), were met at the time.

Statement issued by Tim Harris, MP, Democratic Alliance Shadow Minister of Trade and Industry, November 17 2010

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