A BRITISH human rights activist leading an investigation into the South African leg of an alleged $2 trillion-a-year (R28 trillion) money laundering ring has accused five KwaZulu-Natal judges of promoting money laundering.
Justin Lewis, of British human rights group Casisa (Constitution Accountability, Sedition, Independent, State, Access), alleges that the judges would grant rights to liquidate SA-based companies which were claimed to be indebted to international financial institutions, without seeking proof and contracts of the loans before granting liquidation orders.
Lewis said the UK government was investigating money laundering by individuals in collusion with UK financial institutions. The investigation was commissioned in 2017.
One of the cases with a South African link concerns a company owned by a British citizen who moved to Durban.
The man’s company was liquidated in 2014 after a sequestration order for a R7million loan which he argued in court papers was fictitious. His appeal against the sequestration was dismissed by one of the five KZN judges.
“The bank bought a shelf company for me for £4100 (R76800). The judges approved the liquidation without asking for contractual agreement or even loan documents. I’ve been fighting this here in South Africa for too long now,” the businessman said.
Lewis has since reported the judges to the police, on the advice of the office of Chief Justice Mogoeng Mogoeng.
On December 27 he handed over to the Cape High Court an official executive summary relating to the investigation into money laundering.
According to the documents, the implicated judges did not demand proof from the petitioning creditor of the international loans in accordance with the anti-money-laundering requirements.
“The facilitation of liquidation of SA companies by judges without demanding proof of the loan from the petitioning creditor of the international loan is tantamount to promoting money laundering. Any petitioning creditor must prove the debt in court when applying for liquidation. Certain banks in the UK have been identified as being involved in this crime with employees behind this crime,” Lewis said.
He said the banks under investigation in the UK used their trust advisory subsidiaries, which exchange fictitious guarantees between themselves based on “invisible international loans” which did not exist.
They then approach foreign courts where the income derived from organised crime is held in a company, acting as petitioning creditors of the selected company, and seek its liquidation based on the “invisible international loans”.
“These liquidations based on international loans resulted in the unlawful transfer of money from SA to the UK without following Treasury requirements,” Lewis said, adding that the five SA judges’ actions in not requesting evidence of the loans facilitated organised crime through the legalisation of court-sanctioned international money-laundering structures.
He said no international loan agreement existed in the case of the Durban businessman and an unlawful act was committed to claim money from the liquidated estate to transfer the funds offshore.
The investigation confirms in five court applications involving 13 judicial authorities across five dominions that none of the alleged transactions occurred and there are no supporting banking documents or loan agreements, according to Lewis.
Chief Justice spokesperson Nathi Mncube declined to comment, but a Western Cape police officer identified only as Lieutenant-Colonel Lourens said the matter was registered with the police and later handed over to the Hawks.
KZN Judge President Achmat Jappie said there was no evidence of judges being involved in, or promoting money laundering. He said Lewis failed to mention that the Durban businessman’s matter was heard in court by a judge.
“A ruling was made and it was never appealed against. Had there been an appeal, this would have been a totally different story,” he said.