No prosecution for Sharemax implosion – NPA

Reserve Bank stands by its ruling that Sharemax’s funding model contravened the Banks Act.
It was the controversial ruling by the Reserve Bank that triggered the implosion of the investment scheme. Image: Moneyweb

The National Prosecuting Authority (NPA) has decided not to prosecute any individuals in connection with the implosion of the Sharemax investment scheme more than a decade ago.

The NPA’s decision means no one may ever be held accountable for the scheme’s collapse in which 18 600 investors collectively invested R4.6 billion of their savings and pensions.

The NPA’s decision was revealed when it issued a nolle prosequi certificate to Toffie Risk, a former Sharemax investor, who laid the original criminal charges 12 years ago in 2010.

Advocate Sibongile Mzinyathi, the NPA’s Director of Public Prosecutions in Gauteng, states in the certificate: “I have considered all the statements and affidavits on which charges of fraud, theft and/or contravention of the Banks Act, as contained in the case docket CAS 697/10/2010 and that I decline to prosecute at the instance of the State.”

Bulelwa Makeke, the NPA’s head of communications, confirmed in response to questions that there “are no prospects of a successful prosecution”.

She said the claim that it has taken 12 years for the NPA to reach a decision was incorrect.

“The first nolle prosequi decision had been taken prior to February 2011 already, but further representations to review that decision were given attention.”

The NPA’s decision has been met with disappointment by investors and other stakeholders, while former Sharemax directors said it proved Sharemax was legal and operated in accordance with the law.

Reserve Bank

The NPA’s decision may put the spotlight back on the controversial ruling by the South African Reserve Bank (Sarb) that Sharemax’s funding model contravened the Banks Act. The ruling triggered the implosion.

The NPA’s decision may suggest that the Sarb’s decision was incorrect.

However, the Sarb has washed its hands and denied any wrongdoing.

In a statement issued to Moneyweb, the Sarb said different acts and mandates govern the bank and the NPA.

The Sarb said that in addition to having the power to decide whether an entity has contravened the Banks Act and to issue a directive for monies to be repaid, it also has an obligation to refer the matter to the NPA.

“Any decision of the NPA in this regard remains within its powers/mandate/prerogative and has no bearing on the processes executed by the SA Reserve Bank/Registrar/PA [Prudential Authority] in terms of the Banks Act.

“Following the Court sanctioned Schemes of Arrangement (SoA), the Sarb had no further mandate/involvement/oversight over the matter. The Sarb acted in accordance with the requirements of the Banks Act.”

The SoA refer to the elaborate restructuring of Sharemax and the creation of the Nova Property Group tasked to repay investors within 10 years. However, Nova failed to do so and is currently being investigated by the Companies and Intellectual Property Commission (CIPC) for trading insolvently.


It seems as if there wasn’t any formal interaction between the Sarb and the NPA before the decision was made.

“Various prosecutors were involved in this matter over the last decade and there have been informal engagements with the Reserve Bank. The NPA took an independent decision to decline to prosecute,” Makeke said.

Willie Botha and André Brand

Two former Sharemax directors, Willie Botha and André Brand, were reserved in their responses to the news, but stated that they always believed the company was run in accordance with the law.

Botha, also the founder of Sharemax, said “directors of Sharemax (1999 – approximately August 2010) have always acted with the highest integrity from inception until I resigned as director”.

“From the beginning, we have used the best and most well-known legal advice to advise our company and ensure that we comply with all disclosure requirements and legislation.”

He added that he resigned as a Sharemax director in 2010 and no longer owns any Sharemax shares. “I have absolutely no insight into Nova, their directors and the investors; therefore, I cannot comment on what has happened from the end of 2010 until now. I was not involved with the Nova rescue effort.”

Brand, a prominent former Sharemax director, said he didn’t want to respond to the NPA’s decision publicly. However, he said it had always “been my goal to run our company in accordance with the law, and that is what we have done. I hope everyone can see it now.”

Dominique Haese, a former Sharemax director and the current CEO of Nova, did not respond to questions.


The NPA’s decision may also affect the process AfriForum initiated in 2020 to have the NPA seize and freeze the remaining properties in Nova’s portfolio.

AfriForum asked the NPA to freeze the assets as they were acquired with the proceeds of crime. AfriForum based its assertion on the Sarb’s original decision that Sharemax contravened the Banks Act.

However, the Asset Forfeiture Unit (AFU) decided not to freeze the assets, following which AfriForum called for a review of the decision earlier this year.

In response to questions, Advocate Gerrie Nel, head of AfriForum’s Prosecution Unit, described the nolle prosequi decision as “irrational”.

Nel added that AfriForum has “submitted a Mandamus application to compel the prosecuting authority to proceed with the asset seizure of the Sharemax assets”.

“The respondents said they oppose the application, and the opposing statements are awaited.”

The NPA’s Makeke confirmed that the application would be opposed.

AfriForum asks the NPA to freeze Nova’s assets
AfriForum wants review of NPA decision not to seize Nova assets

Who is responsible for the losses?

Herman Lombaard, a committee member of the Nova Debenture Creditors Action Group (NDCAG), described the decision as nonsensical. “There were several transgressions of relevant legislation, and it seems as if the NPA lacks the confidence, knowledge or capacity to prosecute a relatively simplistic case.”

Lombaard also said he was informed by the late NPA prosecutor Patrick Nkuna in 2018 that the state was ready for prosecution and that arrests were imminent.

The NPA denied having knowledge of such a communication.

Deon Pienaar, an activist who applied to have the Sarb’s decision reviewed in 2017, said the decision raises the question of who is to blame for investors’ losses.

“The Sarb forced Sharemax to adhere to the repayment directive. The NPA’s decision proves no crime was committed and that the directives were issued incorrectly.

“The conclusion can be made that the Sarb bullied the investors and took away their assets without following the law,” said Pienaar.

“This is precisely what I asked the court to consider with my civil litigation, namely to declare the conduct of the Sarb unlawful and ultra vires.

“I maintain that corruption and self-enrichment took place by the officials who were paid millions. Who is responsible for the losses?”

Nova may be a bigger failure than Sharemax
Irba: Former Sharemax auditors’ review application ‘incompetent’ and ‘premature’



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The Georgios and family trusts and Accellerate Property Fund REIT need to bear most of the blame.

This whole mess smacks of collusion – just not sure with who or how…..if the independent SARB suspects fraud and the NPA does not then I know where I would put my money! When are we going to rid this country of ANC coverups incompetence and corruption?

12 years of legal fees, Zuma still ongoing after a decade or more and a myriad of other cases shifting from magistrate to constitutional court … yep, the wheels of justice sure do grind slowly in Mzanzi , but they certainly don’t grind exceedingly fine.

End of comments.



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