Cobus Kellermann lays criminal defamation complaint

He also wants to increase his claims for damages from various media outlets from R30m to R900m.
Alec Hogg has had criminal defamation charges filed against him. Image: Moneyweb

Cobus Kellermann has filed criminal defamation charges against Alec Hogg, editor and owner of BizNews, following the publication of a series of allegedly defamatory articles in 2015, written by Hogg and carried on Hogg’s website BizNews and Fin24.

These articles labelled Kellermann and his partner David Cosgrove as criminals and the kingpins behind the so-called Belvedere scheme, which was labelled a “blatantly fraudulent Ponzi scheme” of between R10 billion and R200 billion.

Kellermann claims the articles were totally untrue – supported by several regulators terminating investigations – and resulted in him losing his job and business, the prospects of ever working in the financial services industry again and the respect of his peers.

Hogg, who was the founder of Moneyweb, said in response he was unaware of the criminal complaint but stated that he would defend any charges.

Criminal defamation

There have not been many criminal defamation cases in South Africa, although in at least one conviction in 2008 an accused received a suspended sentence. As recently as 2015 there was also a debate around decriminalising defamation as it may be unconstitutional.

Criminal defamation requires the state to prove that the person so charged made the defamatory statement intentionally and with the object of maliciously damaging another person’s reputation.

The criminal charges against Hogg were filed in Johannesburg. In the affidavit, Kellermann states that he filed the charges against Hogg as the owner and/or editor of the website Biznews.com. Kellerman goes on to detail the false allegations he says Hogg made in a series of articles about him.

Kellermann has also filed a similar complaint against Esmaré Weideman, who at the time was CEO of Media 24. Media 24’s news websites, news24.com and fin24.com had republished Hogg’s articles. In his affidavit of complaint against Weideman, Kellerman wrongly alleges she was the editor of these websites.

Kellermann does not allege that Weideman had any personal knowledge or involvement in the republication of Hogg’s articles or the editorial decisions of the news websites. Weideman said she was unaware of the complaint but would defend the matter.

From R30 million to R900 million

In separate proceedings, Kellerman instituted a civil claim for damages in 2018 against various media houses and Hogg in his personal capacity.

He originally claimed R30 million for general damages to his reputation from Media24, Blackstar TV (Arena), Africa Business News (CNBC Africa), as well as Hogg and his media company Aurelius Media, which owns BizNews.

Kellermann has now upped the ante by seeking to amend his particulars of the case, by adding further specific claims for patrimonial losses, being amounts which he claims he can prove and quantify, relating to his loss of earnings and future earnings.

If a court approves the amendment application, the total claims for damages will increase from R30 million to nearly R900 million.

Apart from Arena, all the publishers confirmed to Moneyweb that they would oppose the applications to increase the damages sought. At the time of publication, Arena had not responded.

History

The defamation case stems from the publication of various articles in 2015 claiming Belvedere was a massive Ponzi scheme of up to R200 billion. The articles were largely based on those US-based David Marchant posted on his blog, OffshoreAlert.

Kellermann and Cosgrove were cited as the kingpins of the scheme, which spurred on regulators in Guernsey, South Africa and Mauritius to initiate investigations.

Since then, the regulators in Guernsey and South Africa have terminated the investigations and announced they would not take further steps, effectively clearing the duo of any wrongdoing.

The Mauritian regulator initiated an investigation in 2015 and closed several of Belvedere’s companies and revoked its management license. Cosgrove was also disqualified from holding a position as an officer or director. No steps  were taken against Kellermann.*

Read:
The greatest Ponzi scheme that never was
SA regulator clear Cobus Kellermann of any wrongdoing
CFA Institute clears Cobus Kellermann
Guernsey regulator clears David Cosgrove publicly.

Actuarial report

Kellermann filed his motion to amend the damages in the defamation cases after an actuarial report, attached to the various applications, found that his loss of historical and future income amounts to $10 945 356. Kellermann now claims this amount in rands from the media groups.

Previous damages claim in terms of the original defamation applications. Proposed new damages
Alec Hogg  R5 million R187 918 036
Aurelius Media (BizNews) R5 million R187 918 036
Blackstar TV (Arena) R5 million R166 180 340
Media24 R10 million R166 180 340
Africa Business News (CNBC Africa) R5 million R187 918 036
  R30 million R896 114 788

Media groups to oppose

The media groups all indicated they would oppose the application.

Hogg said: “Mr Kellerman has attempted to introduce a new claim – for patrimonial loss – in his existing defamation claim against me and Aurelius Media. We have objected to this attempt on the basis that such a claim (which I deny exists) has prescribed. Mr Kellerman will now have to apply to court if he wants to try to introduce this claim – which I will oppose.”

Ishmet Davidson, CEO of Media24, also acknowledged Kellermann’s application to amend the claim and said the company had instructed its lawyers to oppose the proposed amendment. He also said although Media24 and Weideman were unaware of the charge of criminal defamation: “Media24 will, if need be, defend the matter accordingly.”

Roberta Naicker, MD of African Business News (ABN), said the case is sub judice, but that Kellermann has on two occasions filed a notice of intention to amend the claimed amounts, to which ABN objected. She added that the period for such applications has expired. “As such, the pleadings have not been amended as per your [Moneyweb’s] enquiry, nor is there even a pending attempt to do so. Therefore, Mr Kellerman’s claim remains as originally pleaded.”

Media frenzy 

In the affidavits filed with the criminal defamation charges, Kellermann also described that apart from him suffering significant financial loss, the subsequent media frenzy caused him to fear for the safety of his family.

“Journalists, acting on the information contained in the articles, swamped my home. They ‘camped’ outside my driveway. I literally could not enter or exit the front gate.

“Cars were parked across my driveway. Cameras and microphones were everywhere.

“My wife felt very unsafe and overwhelmed. I felt like my whole reputation and career was going to be reduced to a lie in bold print.

“I could hardly leave the house. The kitchen was dangerous territory too as I could see journalists from outside the gate from the kitchen and vice versa. I became paranoid wondering if the gate was high enough to keep them out.

“I closed all curtains and blinds and kept the phone at hand, not to pick it up but to phone the police should one of the journalists enter the property. I spent most of my time confined to my bedroom with the lights off. My family’s safety was one of my biggest concerns. Except for what they had to go through, perhaps the worst moment was seeing my innocent wife and child exposed in the media.”

  • After the publication of this article, it was amended to reflect that the Mauritian regulator did in fact, take steps against the Belvedere group of companies and related individuals after 2015. The previous version stated that no steps were taken after 2015.
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I doubt if Alec Hogg has millions to pay Kellerman and all the assets which he has, are probably held in trusts.

Nothing against Nigel Green and DeVere? or they already left the building, so use the R900mil proceeds to chase them internationally?

While I doubt Hogg has R188m, I have a lot of sympathy for Kellerman in that the article was completely hysterical in nature and VERY defamatory. He might have been a “Cowboy” with funds but he’s not the first manager to make exotic investments. The Media should be held accountable for accurate reporting in an effort to stem the tide in “Fake News”. In their efforts to boost circulation readership, they often forget that their are other peoples lives and families the live with the aftermath for years, if not ALL their lives. Good luck Kobus, even if you get 10% of the R900m it will be justice. My only suggestion is take 5% of what you get and seed a fund that holds journalists to account in the future.

It would be interesting to see how he made the calculations for the damages claimed. To increase your claims from R 5 million to almost a R 190 million seems a little too creative.

Besides, how does one claim more money than your assets were ever worth? That would just be considered unjustified enrichment and no reasonable court would award recompense for those damages.

If he can prove that his future employment and earnings are affected by Hogg, he will have a BIG claim.

Just read through Case No.: 19269/2011, before the court now, and it will become as ”clear as mud”, how claims snowballed from the first share stolen by JCI (Brett), from Randgold – TSec executed (and facilitated the theft)to date. Gold Fields will eventually have to defend claims of tens of billions of Rand, as (Western Areas)became the proud owners of the build of the millions of shares stolen.

This saga unfolded since the early days of Y2K (and yes I know – claims under the Companies Act don’t prescribe!)and will most probably carry on on at least a decade more!

”Cynicism is merely the art of seeing things as they are instead of as they ought to be”

Oscar Wilde

Yarwell no fine – and not a moment too soon…

I participated on a daily basis in the discussions on this topic – and was eventually told by one of the ”fact-checker-finders” that ”we are living in cloud-cuckoo-land.

Alec Hogg had a lot to say at the time – ”my view” was that he got a bit arrogant and shirty – by even trying to take Werksmans (the messenger) on!

Hogg and Weideman in my view committed the same crime – defamation, by placing these ridiculous unsubstantiated reports in their publications – they are under obligation to check the facts before they place and or print it!

Hier kom groot ”k@K !

I suspect the civil claims may have prescribed already in terms of the Prescription Act, so perhaps Mr Kellerman has waited too long with the civil part of his legal action.

”He also wants to increase his claims for damages from various media outlets from R30m to R900m”

Have you actually read the first line?

In response to your question “have I actually read the first line” yes tiger, I did, are you daft enough to think that by increasing the amount, the prescription issue falls away ? If so, think again.

Bad news always sells better than good news….Here’s an opportunity to quantify.
I agree that his reputation is in tatters & should be compensated for it. Often the debate here centers around asset management fees please publish the outcome as a value add exercise.

Re. “I agree that his reputation is in tatters & should be compensated for it.”

Kellermann co-owned and helped run a group that operated an $83 million Ponzi scheme, distributed false NAVs to investors, lied to investors, misappropriated investors’s funds, illegally paid itself artificially-inflated fees, and failed to disclose material conflicts of interest.

All of which is provable through documentation.

Contrary to what Moneyweb has reported, David Cosgrove has not been ‘cleared’ of wrongdoing by the Guernsey regulator. Revealingly, Moneyweb’s recent story on this matter failed to mention that Cosgrove is a disqualified director in Mauritius (and had even lost his appeal).

And you believe he deserves “compensation”!!!

Hi DavidMOA….
How many people read your blog….????
Thanks in advance…
Oh & Merry Xmas.

I think Alec was so desperate to have a “big scoop” for his newly launched BizNews that he failed to do proper research into that incompetent bully David Marchant and his OffshoreAlert. Credit to Moneyweb for actually questioning OffshoreAlert at the time.

I’m quite unfamiliar with this matter, but reading that Kellerman’s claim (or revised amount re the claim) is already prescribed – and he’d know that at least – and considering the creative math in arriving at the new figure, it is clearly Kellerman’s shot at having a “big scoop”.

Also, as much as it is advisable to question articles and claims made by journalists (and others), I’m not sure that total faith should be allocated to the “Authorities” that decided the Kellerman matter didn’t need any further investigation. We’ve seen way too many instances where “Authorities” have not done their due diligence or forensic examinations in a full and proper manner.

If Kellerman’s initial claim is still to be heard in court there will be discovery and cross-examination. And that’s a process that I’d be happy to have faith in.

Also, who hides in a dark room and is scared to go into his own kitchen because there are journo’s in the driveway? Weird or wimp – take your pick.

PS: If he was making investment decisions and claims about his ‘product/services’ in the same reckless manner that he has applied to arriving at his revised claim amount, is it any wonder that Alec and others were on his case in the first place.

So after all the dust has settled : how much money was taken from investors and how much was returned to investors? Perhaps that will be a bigger impact on a future career as fund manager…

I don’t think Cobus Kelleraman ever had the respect of ANY industry peers, so what is he actually claiming for?

Yet another provably false story by Moneyweb and Ryk van Niekerk.

For example, van Niekerk reports that “The Mauritian regulator initiated an investigation in 2015 but has taken no actions since then.”

This is simply not true and can be easily proven to be wrong.

The Mauritius FSC published two Public Notices on October 20th, 2014 announcing that it “has initiated enforcement actions” against Belvedere Group’s Four Elements PCC and Lancelot Global PCC. These can be viewed by anyone at https://www.fscmauritius.org/en/enforcement/enforcement-actions#tab-7.

Additionally, far from taking “no actions” since 2015, as van Niekerk reports, the Mauritius FSC actually took several further actions, closing down most or all of Belvedere’s companies and disqualifying several of its officers and directors, including David Cosgrove. Indeed 13 of the last 15 regulatory actions by the Mauritius FSC in 2016 all concerned Belvedere, as you can see at https://www.fscmauritius.org/en/enforcement/enforcement-actions#tab-5.

Given the above, will van Niekerk/Moneyweb correct its story, as any responsible journalist/news service would?

Meanwhile, in another publicly-available matter, the Cayman Islands Monetary Authority closed down Belvedere’s Brighton SPC and, in a forensic report, determined it had, inter alia, operated an $83 million Ponzi scheme in the name of Kijani Commodity Fund. In prospectuses and promotional material produced and distributed by Belvedere Group (joint owner: Cobus Kellermann), Kijani’s investment manager was identified as RDL Management Ltd. (joint owner and “portfolio manager”: Kellermann), its investment adviser was identified as Lancelot Investments SARL (joint owner: Kellermann), and its “Independent Administrator”, Secretary, Registrar, and Transfer Agent was identified as Belvedere Management Limited (joint owner: Kellermann). In a “Due Diligence Questionnaire” for Kijani dated “January 2014”, Kellermann was personally identified as the “portfolio manager of the funds which the firm [RDL] manages”, of which Kijani was one, and that he responsible for “research and development”.

I could go on but it long ago became clear to me that Moneyweb is uninterested in reporting facts. For example, van Niekerk recently wrote an article about David Cosgrove in which he – remarkably – failed to mention that he was a disqualified director in Mauritius and had also lost his appeal.

David Marchant
OffshoreAlert

Well the Mauritius FSC makes no mention of a ponzi scheme. Where is their finding of a ponzi scheme? Please provide that link…

Where’s the link to “publicly-available” forensic report by the Cayman Islands Monetary Authority showing a ponzi scheme? I’m genuinely interested to see this.

Re. “Where’s the link to “publicly-available” forensic report by the Cayman Islands Monetary Authority showing a ponzi scheme? I’m genuinely interested to see this.”

Go to https://www.offshorealert.com/moneyweb-false-reporting-about-david-cosgrove-cobus-kellermann-belvedere.aspx, scroll down to “see for yourself in the winding up petition and the first report of the liquidators” and click on “winding up petition” and “first report of the liquidators”. You can also download other documents from the same web page.

Re. “Well the Mauritius FSC makes no mention of a ponzi scheme. Where is their finding of a ponzi scheme? Please provide that link…”

OffshoreAlert never reported that the Mauritius FSC made a “finding of a Ponzi scheme” so why bring it up? We reported that the Mauritius FSC closed down most or all of Belvedere’s companies for an array of regulatory breaches.

In any event, Kijani Commodity Fund, which was a Ponzi scheme, began life in Mauritius and moved to Cayman when the Mauritius FSC closed it down.

Generally, despite what you have read on Moneyweb, whose reporting has been inaccurate over and over again, OffshoreAlert never reported that Belvedere was ‘the world’s biggest Ponzi scheme’ or anything remotely like that. We reported that it was involved in an array of illegal activity, including calculating and distributing false NAVs to investors, misappropriation of investors’ funds, material omissions and false statements to investors, involvement in and operation of Ponzi schemes, self-dealing, and failure to disclose conflicts of interest.

We also reported that Belvedere itself claimed to have $16 billion of assets under administration, management and advisory, which suspect was simply another lie.

All of the above is fact and supported by a plethora of documents in my possession, documents which, I might add, I have offered to Moneyweb in the past but which it has shown no interest in receiving, preferring instead to publish provably false information, such as “The Mauritian regulator initiated an investigation in 2015 but has taken no actions since then”, OffshoreAlert described Belvedere as ‘the world’s largest Ponzi scheme’, etc.

Question: Has Alec Hogg still got his Moneyweb shares?

Maybe he’ll have to sell it now – what a pity that the Gupta’s are gone and not potentially on the bid to buy them!

I note that Ryk van Niekerk has partially corrected the above article after I pointed out parts of it were wrong. However, it’s still inaccurate.

Specifically: “The Mauritian regulator initiated an investigation in 2015 …”.

The Mauritius FSC investigation began no later than 2014, as evidenced by two ‘Public Notices’ dated October 20th, 2014 against Belvedere Group’s Lancelot Global PCC and Four Elements PCC that were published on the regulator’s website and can be viewed at https://www.fscmauritius.org/en/enforcement/enforcement-actions#tab-7

That date is particularly relevant because it is five months BEFORE OffshoreAlert published its initial exposé of Belvedere Group, thereby disproving the falsehood that regulatory action only began as a result of OffshoreAlert’s exposé.

Another falsehood is that OffshoreAlert described Belvedere as “a massive Ponzi scheme of up to R200 billion”.

Neither I nor OffshoreAlert has ever described Belvedere as “a Ponzi scheme” (not once … ever), much less to the tune of “R200 billion”.

We reported that Belvedere, which comprised a complex web of companies in different countries offering a range of financial services, was involved in an array of illegal activity, including misappropriation of investors’ funds, lying to investors, calculating and distributing false NAVs, and operating and providing services to Ponzi schemes, all of which is true and provable through documentation. We also reported that Belvedere itself claimed to have $16 billion of assets under administration, management and advisory. South African news services, including Moneyweb, misreported this as OffshoreAlert describing Belvedere as ‘the world’s biggest Ponzi scheme’.

Another falsehood perpetuated by Moneyweb is that David Cosgrove was ‘cleared’ by the Guernsey FSC, which is based on an absurd interpretation of a statement by the regulator.

As I’ve pointed out to Moneyweb several times previously, but which always fell on deaf ears, Patrick Cairns’ reporting about Belvedere Group was littered with falsehoods and inaccuracies (which I can prove through documentation, if you want me to), and its editor should have listened to my complaints and taken appropriate action, which could have been anything from providing a guiding hand to suspending him. His reporting was so false and misleading as to be suspicious and is worthy of an independent investigation, in my opinion.

Moneyweb let a loose canon lie to its readers.

One final point: Ryk van Niekerk continues to describe OffshoreAlert’s news articles as ‘blogs’. By doing so, he demeans himself and Moneyweb, not me and OffshoreAlert. It smacks of pettiness and malice.

Mr Marchant, are/were you paid to write the Belvedere stories? I believe DeVere may be behind most of it. Can you categorically state that DeVere, or any individual related to DeVere, did not pay you (directly or indirectly) to write the original articles? The amount of time you have spent on comments under this article suggests that you are forced to do it due to some financial incentive.

Why do you think that not a single regulator took criminal steps against Kellermann and Cosgrove? Surely if this was such a massive fraud, there would have been a criminal investigation somewhere?

The regulators in Guernsey and SA are normally pretty effective. (The Mauritian regulator is absolutely useless and clueless.) Surely these regulators would want to protect their reputations by instituting criminal proceedings if fraud occurred under their watch?

And why did you at Offshore ALert not cover the decisions of the regulators not take steps against the individuals on your blog? (I also think Offshore Alert is a blog. The top read story on your site is a Belvedere story dating back to 2015.)

And lastly, why do you not comment on the defamation cases and the amounts of damages sought from the media outlets, which was mostly your doing as the articles were based on your apparent flawed research?

Re. “Mr Marchant, are/were you paid to write the Belvedere stories?”

No. That’s not how bona fide journalism works. I’m a professional journalist.

Re. “The amount of time you have spent on comments under this article suggests that you are forced to do it due to some financial incentive.”

What an illogical, spectacularly moronic comment.

Re. “Why do you think that not a single regulator took criminal steps against Kellermann and Cosgrove?”.

Regulators don’t take criminal actions, as any fule kno. They take civil and/or administrative actions.

Re. “Surely if this was such a massive fraud, there would have been a criminal investigation somewhere?”.”

Few fraudsters, relative to how many fraudsters exist, are ever criminally investigated, much less charged, or convicted. For example, Kijani Commodity Fund perpetrated an $83 million Ponzi scheme, as revealed by OffshoreAlert and as confirmed by the Cayman Islands Monetary Authority, but no-one has been prosecuted or even had regulatory sanctions against them. Outside the US, few fraudsters even have regulatory actions taken against them.

Re. “The regulators in Guernsey and SA are normally pretty effective. (The Mauritian regulator is absolutely useless and clueless.)”.

Regulators generally are ineffective, particularly outside the USA. When it comes to Belvedere, which was involved in an array of illegal activity, including fraud, the Mauritius regulator has been far more effective than those in Guernsey or South Africa, the latter of whose financial regulator is a joke, in my opinion.

Re. “And why did you at Offshore ALert not cover the decisions of the regulators not take steps against the individuals on your blog? (I also think Offshore Alert is a blog. The top read story on your site is a Belvedere story dating back to 2015.)”

We have covered the decision by the Guernsey regulator not to take “further” action regarding Belvedere, after having closed down all of its companies. That was a year or so ago when it first became known. How does our “most read” story dictate you referring to our news articles as ‘blogs’. Again, what a spectacularly moronic comment.

Re. “And lastly, why do you not comment on the defamation cases and the amounts of damages sought from the media outlets, which was mostly your doing as the articles were based on your apparent flawed research?”.

Your expectation that I comment about every aspect of the Belvedere case or that I control what other journalists write is … dare I say it … spectacularly moronic. I will say that South African news organizations, including Moneyweb, have time and again shown themselves to be incapable of understanding what we wrote. For example, we never reported or suggested that Belvedere was “the world’s biggest Ponzi scheme” or even mentioned the Strategic Growth Fund in our exposé of Belvedere.

End of comments.

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