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    Markus Jooste on trial in Germany next year – SARB also readying criminal case

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    The noose is tightening on former Steinhoff CEO Markus Jooste with both the German and South African authorities bringing in heavy artillery against the corporate fraudster. During the press conference at the Medium Term Budget, SA Reserve Bank Governor Lesetja Kganyago said there is “an army” of accountants and lawyers compiling evidence with which to charge him in South African courts. Kganyago said substantial resources have been set aside for court actions as “we expect the cases could continue for years – the people we are charging have deep pockets.” But the SA authorities may be beaten to the punch by their German counterparts. As you’ll read below, Jooste and three of his cohorts have been formally charged and will go in trial in German in the New Year. Next month it will be five years since Jooste resigned from Steinhoff and sent an incriminating SMS to his close associates apologising for “big mistakes” and promising to face the music “like a man.” – Alec Hogg

    By Janice Kew

    (Bloomberg) — Former Steinhoff International Holdings NV Chief Executive Officer Markus Jooste is among four people who will go on trial in Germany next year on charges of accounting fraud.

    No date has been set for the start of Jooste’s proceedings, according to a statement Thursday by the Oldenburg regional court, which didn’t identify any of the people. The case against two former Steinhoff executives, who worked in Germany, is set to begin on May 3, it said.

    It’s the first time Jooste is set to go on trial. He’s alleged to be the architect of the accounting scandal that engulfed retailer Steinhoff in late 2017, though he’s denied the allegations. The company has been battling to survive for almost five years since auditors refused to sign off on its accounts, leading to Jooste resigning, a dramatic share-price collapse and the start of police and regulatory investigations in both Europe and South Africa. 

    While German authorities haven’t yet officially identified any of the accused, a person familiar with the investigation previously said Jooste was among four people charged in Germany for accounting crimes. Thursday’s statement referred to the 61-year-old CEO of Steinhoff International Holdings, who held that position until the end of 2017.

    Balance-Sheet Fraud

    Jooste didn’t immediately respond to a message sent outside of office hours to a mobile phone number he was most recently known to use. News24 reported the details of the trial earlier on Thursday.

    Jooste, two former Steinhoff executives and a fourth accused were charged last year with balance-sheet fraud carried out between July 2011 and January 2015. The case was subsequently split in two to avoid delays due to the coronavirus pandemic

    As a litany of inflated profit and asset values emerged, the company has been forced to sell off a range of global retail assets to raise funds. It agreed earlier this year to start paying out 1.4 billion euros ($1.46 billion) to investors who lost money.

    The charges allege that fake proceeds from bogus transactions were booked at some of the group’s units. The deals made it seem that assets were sold to third parties, while they were in fact acquired by other companies close to the group, according to investigators.

    Artificial transactions were allegedly used to manipulate balance sheets by more than 1.5 billion euros. Additionally, the value of real-estate assets was inflated by 820 million euros, prosecutors have said. While the charges cover a period from July 2011 to January 2015, a court threw out one count dating back to July 2011, saying it is barred by a statute of limitation.

    The two German former employees include managing directors of Steinhoff Group companies and are listed as 63 and 51 years old. The fourth person is described as a 72-year-old trustee of a company in the British Virgin Islands and is said to have been guilty of aiding and abetting incorrect presentation in balance sheets in four cases.

    Read more:

    • SARB’s asset attachment raid – Markus Jooste confidante with back story on why it happened, what it means for ex-Steinhoff CEO
    • Court order documents: Markus Jooste and Lanzerac
    • On the record: Markus Jooste’s trustee opens up on SARB’s R4.8bn asset raid

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