BusinessLive reports that the Financial Sector Conduct Authority (FSCA) will investigate the role of all key individuals, including the compliance officer, after a Johannesburg financial adviser was arrested last week over fraud charges.
The case relates to unregulated investments in which the adviser’s clients may have lost as much as R100m. The adviser, Thomas Stringfellow, CEO of the Stringfellow Group, was due to appear in the Roodepoort Magistrate’s Court on Monday morning. About 90 clients, mostly pensioners, have formed a WhatsApp group and met the police and the FSCA’s head of investigations, Gerhard van Deventer, in Northriding on Thursday. Stringfellow was apparently advising clients to invest in loan agreements to fund the SA franchise of the Australian sportswear brand Lorna Jane. He had been the MD of Lorna Jane SA since 2011. In the loan agreement he entered into a year ago, Stringfellow guaranteed the capital amounts invested as well as 14% a year in dividends, but advised that the dividends could be as high as 20%. About R130m invested in two funds of funds is safe as unit trust fund assets are held in trust and the funds are invested into the funds’ assets managers such as Investec, Prudential and Coronation. But, investors were apparently encouraged to move out of the unit trust funds as market returns have been poor and invest in the loan agreements and other unregulated funds that Stringfellow ran.
- Read the full original of Laura du Preez’s report in the above regard at BusinessLive
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