Cape Town - The Sekunjalo group of companies has expressed shock at a judgment handed down by the Supreme Court of Appeal (SCA), which set aside an interim interdict preventing Nedbank from closing the group’s bank accounts, and reopening those already closed.
The interdict had been handed down by the Equality Court against Nedbank Limited and Nedbank Private Wealth Stockbrokers (Pty) Ltd, prohibiting them from terminating the bank accounts held by Sekunjalo chairman Dr Iqbal Survé and 42 associated companies.
The interim order had effect pending the finalisation of proceedings in the Equality Court, arising from a complaint of unfair racial discrimination lodged by Sekunjalo against Nedbank.
Sekunjalo’s case is that Nedbank’s conduct constituted unfair discrimination based on race, and it pointed to “white-owned” companies Steinhoff Group, EOH and Tongaat Hulett, which had all been found to have been involved in fraudulent conduct, but whose accounts Nedbank had opted not to close. Nedbank, however, argued that these three had undertaken remedial action and were thus allowed to keep their accounts open.
In March last year, Equality Court Judge Mokgoatji Dolamo found that there had been a prima facie case of discrimination by Nedbank against Sekunjalo in closing their accounts, and granted an interdict in favour of Sekunjalo.
In October last year, this interim interdict was appealed, but Judge Dolamo again ruled in favour of Sekunjalo.
However, Nedbank subsequently took the matter to the SCA, whose findings, contradicting those of Judge Dolamo, were released yesterday in favour of Nedbank.
In what was a landmark case to prove discrimination in how South Africa’s banks treat customers differently according to their racial classification, Sekunjalo said it was significant to note that the case was adjudicated by a panel of five white judges at the SCA – Judges Trevor Gorven, Pieter Meyer, Sharise Weiner, Ashley BinnsWard and Raylene Keightley.
Sekunjalo issued a statement in response to yesterday’s judgment, saying: “Sekunjalo is utterly shocked by the so-called reasoning behind the SCA’s granting Nedbank the right to effectively terminate any banking facility of any company associated to the Sekunjalo Group.
“This leaves the group with no other choice than to appeal to the good sense of the Constitutional Court of South Africa.”
The SCA noted that Nedbank’s decision to review its banker-customer relationship with Sekunjalo was triggered by the Mpati Commission of Inquiry, which was appointed in October 2018 to investigate, report and make findings and recommendations on allegations of impropriety in dealings with the Public Investment Corporation (PIC).
Though the scope of the inquiry was mismanagement at the PIC, and not Sekunjalo companies, the relationship between the PIC and certain companies within the Sekunjalo stable, notably AYO Technology Solutions, came under intense media scrutiny.
As part of its “remedial action”, Sekunjalo appointed advocate Willem Heath, a former judge, to conduct an independent review of the Mpati Commission report.
He found that the commission had erred in several material aspects and that Sekunjalo had been treated unjustly.
The SCA, however, disregarded Heath’s findings, as well as Sekunjalo’s calls for a review of the Mpati Commission report.
Sekunjalo also responded to Nedbank with comprehensive information of more than 100 pages of documents. Despite this, Nedbank claimed to the SCA they had not been provided with a proper response by Sekunjalo. All of this, the SCA seemingly overlooked.
Sekunjalo was subsequently vindicated following a Western Cape High Court settlement between AYO and the PIC in March this year.
The group maintained it has not been found to be suspected of any financial misconduct, it has not been tried nor found guilty of such.
Sekunjalo concluded: “In light of the above, together with other clearly disregarded facts, the decision by the SCA is unreasonable and irrational. There is zero justice in Nedbank, or any other bank, destroying the businesses that are impacted by these decisions.
“Sekunjalo is hopeful the Concourt will consider the apparent discrimination against it, especially against the backdrop of Nedbank’s own admission in writing that the group had not committed anything wrong.”