Despite repeated invitations from presiding judge Brian Spilg, Tigon accused Gary Porritt has so far failed to present his version of events during his cross-examination of the state’s first witness, convicted fraudster Jack Milne.
Porritt and Sue Bennett are standing trial on more than 3 000 charges of fraud, racketeering and contraventions of the Companies Act, Stock Exchanges Control Act and Income Tax Act.
The charges relate to the collapse around 2002 of JSE-listed financial services group Tigon of which Porritt was CEO and Bennett a director. They also had a romantic relationship, the court earlier heard.
Porritt and Bennett are representing themselves, claiming they don’t have funds to pay lawyers. The state, however, alleged earlier that Porritt has direct or indirect access to assets worth more than R100 million.
Porritt, who has been in custody for more than a year after contravening his bail conditions, is currently cross-examining Milne. Milne is former CEO of Progressive Systems College (PSC), a company Tigon offered to buy. He earlier testified that he, Porritt and Bennett conspired to defraud investors when they established the Progressive Systems College Guaranteed Growth (PSCGG) investment fund that was underwritten by Tigon.
Milne, during his testimony, told the court how the three of them concocted the PSCGG prospectus that led investors to believe Milne would invest their money in a diversified portfolio. In fact Porritt made the investments and placed them only in Tigon and its JSE-listed subsidiary, Shawcell.
Milne earlier reached a plea and sentence agreement with the state and served a term in jail for his part in the events.
Porritt and Bennett deny any wrongdoing. Porritt on Monday told the court that the state is saying the prospectus was a fraud “because Milne said so”.
Spilg pointed out that this was supported by documentary evidence.
During cross-examination earlier Porritt repeatedly alleged that Milne misrepresented the value of PSC to Tigon. He said Tigon made the offer to buy PSC for R15 million because it had earnings of R2 million, according to Milne’s representation at the time.
The numbers provided to Tigon during the due diligence, however showed a loss of R47 000.
Milne refused to accept these numbers, saying they were provided by a new accountant who did not understand the business properly. He himself was distracted by other matters and did not see the numbers before they were provided to Tigon, Milne said.
He acknowledged that PSC’s books were in a mess and said he was under the impression that the group’s earnings amounted to R2 million at the time.
Spilg repeatedly asked Porritt what the relevance of PSC’s earnings was to the charges he is facing. He warned Porritt that he might cut the cross-examination short due to a lack of relevance.
“Then you will destroy this whole case,” Porritt responded.
Advocate Etienne Coetzee SC for the state told the court that Porritt had been given ample leeway in his cross-examination about PSC. He said the only relevance is to Milne’s credibility. He also objected to Porritt calling Milne a liar and said that is for the court to determine.
Bennett, in an apparent effort to support Porritt’s line of questioning, also told the court that it was highly relevant to Milne’s credibility.
Spilg said the court was prepared to accept that Milne misled Tigon about the value of PSC.
Milne said Porritt’s aim was not really to buy PSC; he wanted Milne in person, due to his high public profile and reputation as an investment guru. That would lend credibility to the investment scheme Porritt was cooking up, Milne implied. Milne said he told Porritt at the time that he wouldn’t come on board without Tigon buying PSC as well. “It was a package deal,” he said.
Milne said Porritt could have walked away from the deal once he saw that the numbers provided by the accountant failed to support Milne’s representation of PSC’s value. “You never put me on notice. You dragged out the due diligence for 18 months,” he told Porritt.
Spilg repeatedly cautioned Porritt that he is wasting his time covering irrelevant matters. Spilg earlier set a deadline for Porritt to complete his cross-examination and there were only about 14 court dates left.
Spilg also urged Porritt to put his version of events to Milne, which he hadn’t done yet.
The court adjourned twice on Monday for Porritt to cool down and decide whether he was going to apologise for conduct that could have amounted to contempt of court. On both occasions he apologised,
Spilg told him that there “is a degree of decorum” in court and asked Porritt to respect him. He warned Porritt not to shout at him and told him on occasion that he (Porritt) was not the chair of the board or the judge, just someone sitting in the room.
Porritt, who has frequently complained about his health, was looking strong and alert during the hearing. He was brought into court in shackles. The court is awaiting a ruling by the judge president about the continued use of the shackles.