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Amcu accuses Samancor of fraud in court filing

Amcu is seeking the court’s permission to litigate against Samancor.
Samancor Chrome is being accused of transferring $125m to a British Virgin Islands based firm in 2007 to benefit the company's directors. Image: Moneyweb

South Africa’s Association of Mineworkers and Construction Union filed an application in the Johannesburg High Court accusing Samancor Chrome of fraud.

Amcu, which represents beneficiaries of the Ndizani Workers’ Trust, an employee ownership plan that indirectly holds 5.6% of the company, submitted the application Wednesday, according to the Alternative Information & Development Centre, a group assisting in the case. The union accuses the company of transferring $125 million to the bank account of a firm based in the British Virgin Islands in 2007 for the benefit of directors, and of paying “baseless” management fees and excessive sales commissions.

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A Samancor spokeswoman didn’t immediately answer calls or an email seeking comment.

“Amcu seeks the court’s permission to litigate against Samancor, its current and former directors, and various other entities implicated in the impugned transactions and seeks an order that Samancor account for the true value of the transactions,” AIDC said in a statement. If granted the court’s leave, “Amcu will proceed to seek the appointment of independent directors and the award of compensation to persons harmed by the transactions.”

The estimated loss to workers who are members of the trust is $100 million, Richard Spoor, an attorney for the applicants, said in a post on Twitter.

© 2019 Bloomberg L.P.

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