NPA fails in bid to get Tariomix R100m back

THE NATIONAL Prosecuting Authority (NPA) has failed in its urgent legal bid to have about R100 million, which was initially kept in a special Absa Bank account but later paid over to the liquidators of Tariomix, returned to Absa.

The Gauteng High Court, Pretoria, on Friday struck the NPA’s urgent application from the roll due to the lack of urgency.

This means that if the NPA wants to pursue its legal bid to have the money returned to Absa, it would have to re-enrol the matter – this time on the normal court roll, which could take months before it is heard.

The NPA told Judge Linda Retief that Absa and the liquidators should urgently be ordered to pay back the money to Absa in light of a preservation order obtained by the prosecuting authority in 2021, in which the money linked to diamond dealer Louis Liebenberg was frozen following allegations of money laundering and that he was running a Ponzi scheme.

The preservation order was later overturned by the court following an application by Liebenberg. But the NPA maintained that as it was going to appeal this before the Supreme Court of Appeal (SCA). The initial preservation order is still in place.

It claimed that Absa thus had no right under these circumstances to have transferred the money into the account of the liquidators. But, as pointed out by Judge Retief, the problem the NPA is facing is that it has allowed its appeal to lapse.

As things stand, there is no preservation order as argued by Absa and the liquidators. The NPA must first overcome its first hurdle – asking permission from the SCA to reinstate the appeal – before it can actually appeal the fact that the preservation order was overturned.

In ordering that the application was not urgent, Judge Retief commented that if the NPA did not allow the appeal to lapse, things would have been different.

The South African Revenue Service (Sars) meanwhile, at the start of Friday’s urgent court proceedings, launched an application to join the proceedings as an applicant.

It was argued on behalf of Sars that the revenue service has a substantial and direct interest in the case, as it is also embroiled in legal proceedings to preserve the money.

Judge Retief, however, refused Sars’s request on technical grounds, which also included the lack of urgency.

It was meanwhile argued on behalf of the NPA that the matter was urgent, as the funds are now in the hands of the liquidators, and the prosecuting authority holds no security over the money.

The NPA said it also has no idea what is currently left of the money. It questioned what would happen if it won its SCA battle to have the preservation order reinstated, and there are no funds left.

Judge Retief was told that Absa paid the money over on November 22, following a letter of demand by the liquidators in this regard. The NPA said it only became aware of this fact on May 9.

It subsequently sent a letter to Absa to transfer the money back into its account, where the NPA wants it to remain until it won its battle to have the money preserved, with the aim of forfeiting it to the State as it claims it is the proceeds of crime.

Absa, however, informed the NPA that the funds will remain with the liquidators.

Absa argued that it is common cause that the NPA’s appeal had lapsed and said once it had lapsed, there is no preservation order in place.

It also told the court that the NPA could take the liquidators to task if any of the money disappeared, as there are checks and balances in place. The court was told that as things stand, the NPA has no proof that the money will disappear.

The money is safely in the insolvency account to reimburse the victims of an alleged Ponzi scheme and there is thus no urgency to this matter, it was argued on behalf of Absa.

It was likewise argued on behalf of the liquidators that the money is safe in their account and that “nothing untoward is happening here”.

They said the money was transferred months ago, yet the NPA only now on an extremely urgent basis rushed to court.

Judge Retief meanwhile did not hear arguments regarding the merits of the NPA’s application, as she found the matter not to be urgent.

The NPA is subsequently appealing the ruling before the SCA and is still awaiting a date for the hearing.