Investors sometimes ask us – why did KPMG complete only one audit (the one that finished in February 2004)?
· Early in 2004 there were suspicions on the part of some in the Mauritian Financial Services Commission, and indeed within Leaderguard Securities that all was not financially well with LSF.
· The liquidator of LSF is also persuaded that quite early in the piece, the collapse of LSF was carefully planned by Directors in collusion with Towergate (Who would come to the rescue with a compromise solution that would both benefit Towergate and protect the dishonest Directors).
· And maybe KPMG was unwilling to venture forth a second time.
Here is the correspondence.
Extract emails between Stefan Pretorius LSF), Juan Venter (LS) and Renso du Plessis (LS)
Obtained by the scorpions from a remnant computer in Leaderguard offices in Mauritius with a hard disk left in place
Email: from Stefan Pretorius to Juan Venter (8th June 2004, 12:13)
Juan, the fact remains as follows. I am the Director of this company. It is my duty to ensure that everything runs 100 percent alright and if this is not the case, I am obliged to report this or to stop it.
Our growth figures are false. We market under false pretensions. We are beyond the maximum allowed losses.
My proposal is that the four of us obtain legal advice and put the cards on the table. Then we can find a way to keep us (lit: our asses) out of prison.
This is the pass that I will follow.
If you don’t feel the same, I will resign.
I don’t have any bad feelings towards anybody, but this is how I feel about the matter.
Email: from Juan Venter to Stefan Pretorius (8th June 2004 14.23)
It really doesn’t work like that. We are in s…t because of the losses on/in the accounts. We will have to make a plan together; it is totally unfair to resign now. I think we should give it another month and then we will have another look at the accounts. We certainly can’t “desert the ship” now, the three of us have made a mess of this, if somebody has to resign, it is my father (Basie Venter). The three of us have made the mess, the three of us can’t “desert the ship”.
Email: from Stefan Pretorius to Renso du Plessis, forwarded to Juan Venter (9th June 2004 11.27)
Hi all of you. I have taken heart to write this email as I am not somebody who seeks confrontation. I will resign with effect from 1 July 2004. This of course means that I will have to leave Mauritius as I will not be a director any longer and as my work permit is based on this. I also still believe that there is a solution for the dilemma we are clearly in. You will have to manage this unbelievably well.
The first thing you have to do is to find somebody who will replace my position on the board. I propose Renso for this, as he has already come to Mauritius and been approved by FSC as “fit and proper”. I also know that Marietjie Fryer (the Financial Director of Leaderguard Securities ) will leave immediately, but she will have to be informed.
Secondly, you will have to find a way to increase the margin with GNI (a branch of MAN Financial that acted as a trading platform for LSF). The process to register GNI as the platform is more easily said than done. Yes, it can be done, but not overnight. As I resign,
I propose that LSF buys back my share; I can then send the money for you to GNI. I know that this is a risk because perhaps I can never give that money back to you, but if I have not stolen money toward that time, I will never do so”. [In other words Stefan is saying “I am an honest guy – if I can’t return the money later on, it’s not because I have ran away with the money.”]
This is a risk that you guys have to take.
According to my calculations, we can get the following moneys from LSF:
- Loan account: USD 125,000 (USD 100,000 already paid out);
- Shareholders contribution: USD 125,000 (USD 25,000 already paid out);
- Assets: USD 200,000 (25 percent of game farm);
- USD 125,000 (25 percent of currency company value – to be confirmed)
- The total is about USD 1,600,000
If we plan this nicely, these additional monies can be with GNI reasonably fast.
I still have a slightly smaller detail that you will have to deal with locally, but will explain this in more detail and forward this to you.
Regards,
Stefan Pretorius.
The letter is important because:-
Ø It is an open admission of fraud on the part of the Leaderguard Directors (both LSF and LS)
Ø It indicates a plan or scheme on the part of Stefan Pretorius to illegally acquire remnant Leaderguard assets that (if past records be correct) will find their way from GNI (MAN Financial – a trading platform) into some irregular bank accounts belonging to the correspondents. KPMG now knows which they should have known in their audit that once a thief, always a thief.
I suppose that it would be too much to expect that Stefan’s plan “to obtain” 1.6 Million Dollars of Leaderguard assets was his intention to trade such Leaderguard funds through GNI for the benefit of investors!
· Early in 2004 there were suspicions on the part of some in the Mauritian Financial Services Commission, and indeed within Leaderguard Securities that all was not financially well with LSF.
· The liquidator of LSF is also persuaded that quite early in the piece, the collapse of LSF was carefully planned by Directors in collusion with Towergate (Who would come to the rescue with a compromise solution that would both benefit Towergate and protect the dishonest Directors).
· And maybe KPMG was unwilling to venture forth a second time.
Here is the correspondence.
Extract emails between Stefan Pretorius LSF), Juan Venter (LS) and Renso du Plessis (LS)
Obtained by the scorpions from a remnant computer in Leaderguard offices in Mauritius with a hard disk left in place
Email: from Stefan Pretorius to Juan Venter (8th June 2004, 12:13)
Juan, the fact remains as follows. I am the Director of this company. It is my duty to ensure that everything runs 100 percent alright and if this is not the case, I am obliged to report this or to stop it.
Our growth figures are false. We market under false pretensions. We are beyond the maximum allowed losses.
My proposal is that the four of us obtain legal advice and put the cards on the table. Then we can find a way to keep us (lit: our asses) out of prison.
This is the pass that I will follow.
If you don’t feel the same, I will resign.
I don’t have any bad feelings towards anybody, but this is how I feel about the matter.
Email: from Juan Venter to Stefan Pretorius (8th June 2004 14.23)
It really doesn’t work like that. We are in s…t because of the losses on/in the accounts. We will have to make a plan together; it is totally unfair to resign now. I think we should give it another month and then we will have another look at the accounts. We certainly can’t “desert the ship” now, the three of us have made a mess of this, if somebody has to resign, it is my father (Basie Venter). The three of us have made the mess, the three of us can’t “desert the ship”.
Email: from Stefan Pretorius to Renso du Plessis, forwarded to Juan Venter (9th June 2004 11.27)
Hi all of you. I have taken heart to write this email as I am not somebody who seeks confrontation. I will resign with effect from 1 July 2004. This of course means that I will have to leave Mauritius as I will not be a director any longer and as my work permit is based on this. I also still believe that there is a solution for the dilemma we are clearly in. You will have to manage this unbelievably well.
The first thing you have to do is to find somebody who will replace my position on the board. I propose Renso for this, as he has already come to Mauritius and been approved by FSC as “fit and proper”. I also know that Marietjie Fryer (the Financial Director of Leaderguard Securities ) will leave immediately, but she will have to be informed.
Secondly, you will have to find a way to increase the margin with GNI (a branch of MAN Financial that acted as a trading platform for LSF). The process to register GNI as the platform is more easily said than done. Yes, it can be done, but not overnight. As I resign,
I propose that LSF buys back my share; I can then send the money for you to GNI. I know that this is a risk because perhaps I can never give that money back to you, but if I have not stolen money toward that time, I will never do so”. [In other words Stefan is saying “I am an honest guy – if I can’t return the money later on, it’s not because I have ran away with the money.”]
This is a risk that you guys have to take.
According to my calculations, we can get the following moneys from LSF:
- Loan account: USD 125,000 (USD 100,000 already paid out);
- Shareholders contribution: USD 125,000 (USD 25,000 already paid out);
- Assets: USD 200,000 (25 percent of game farm);
- USD 125,000 (25 percent of currency company value – to be confirmed)
- The total is about USD 1,600,000
If we plan this nicely, these additional monies can be with GNI reasonably fast.
I still have a slightly smaller detail that you will have to deal with locally, but will explain this in more detail and forward this to you.
Regards,
Stefan Pretorius.
The letter is important because:-
Ø It is an open admission of fraud on the part of the Leaderguard Directors (both LSF and LS)
Ø It indicates a plan or scheme on the part of Stefan Pretorius to illegally acquire remnant Leaderguard assets that (if past records be correct) will find their way from GNI (MAN Financial – a trading platform) into some irregular bank accounts belonging to the correspondents. KPMG now knows which they should have known in their audit that once a thief, always a thief.
I suppose that it would be too much to expect that Stefan’s plan “to obtain” 1.6 Million Dollars of Leaderguard assets was his intention to trade such Leaderguard funds through GNI for the benefit of investors!
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