The Southern African Music Rights Organisation (Samro) has decided to shut down the undocumented works royalties portal after it suspected fraudulent claims which were made by its members.
According to the forensic investigations report conducted by Fundudzi Forensic Services, Samro did so after it had paid a staggering R24-million to publishers and composers for the undocumented works.
Undocumented works is simplified as collected royalties which the organisation could not authenticate nor trace the real owners of the copyright. And this resulted in the royalties being claimed by publishers and composers, some of whom were/are board members of the collecting society.
Forensic report
The report, which Sunday World is in possession of, stated that in the 2020 financial year, Samro launched a new online platform that gave its members, who were previously excluded from accessing undocumented works, an access to undocumented works. Prior to that, only publishers who were also board members of the organisation were solely individuals with access to undocumented works.
Fundudzi stated in its report that it understood that one publishing company, Sheer Publishing, had allegedly claimed R3.4-million in respect of undocumented music. And it did so on behalf of Allan Sebeelo and Glenn Sebeelo. Their publishing companies were named as Hash One Committee Entertainment, Sotho Mafia and Glenn Publishing.
“The said claim of the of the undocumented works was alleged to have been irregular. And there may have been an employee within Samro who may have colluded with Sheer Publishing to submit claims for the alleged irregular undocumented works,” reads the report.
“We further understand that on 17 November 2022, the board of Samro considered the matter relating to royalty payments/claims from undocumented and non-identified works to the value of R3.4-million made during the financial year 2020 and 2021, and resolved that a forensic investigation be commissioned on the matter through an independent service provider.”
Report kept to hide corruption
The report reiterated that this is where Fundudzi was appointed to investigate.
The issue of the Fundudzi report, which was released in July 2023 to the selected three board members and two executives within Samro, had caused a serios ruction between the ordinary members, who accused the board and the executive led by CEO, Annabell Lebethe of acting in bad faith. They claimed that the reason the report was kept under the carpet was as to hide corruption, which they claimed had rocked the organisation.
Former Samro employee and ex-Samro board member, Mandrew Mnguni, resigned from the two organisations in 2023. He is also the subject of an investigation.
According to the report, Mnguni stated when he was consulted by Fundudzi that there was an employee named Clint Louw who once worked for Samro and also acted as a consultant for Sheer Publishing, and later worked for Sony Music when investigations were conducted by Fundudzi.
Mnguni said Louw worked at Samro before he was appointed as a consultant for Sheer Publishing. His assertion was corroborated by Samro’s members rights general manager, Karabo Senna.
Louw also told the investigators that he did work for Samro and resigned in 2019. That was when he joined Sheer Publishing as a consultant.
He told investigators that while he was still working for Samro, the collecting society would publish the undocumented works on File Transfer Protocol (FTP) sites. Thereafter publishers would be sent emails to alert them that the undocumented files were ready. And emails would be sent to Samro clients who were unable to access FTP files.
Validity of claims
Louw said the onus to prove ownership of undocumented works, the ownership of the royalties was not solely depended on members who were making claims. But Samro on the other hand had to verify the validity of claims made for the undocumented works to check if they were valid or not.
Louw further told investigators that should those royalties claims submitted be found to be incorrect, such claims would be reversed without any consequences to the members who had submitted fraudulent claims.
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