Regiments Capital founders and directors Magandheran Pillay and Litha Mveliso Nyhonyha have launched a court bid to compel the National Prosecuting Authority (NPA) to pay their mounting legal bill – which amounts to millions of rand.
Pillay, in his affidavit lodged on behalf of Regiments Fund Managers, Regiments Securities, Ash Brook Investments and Coral Lagoon Investments, said the companies need to have some of their funds released to fund their numerous legal challenges.
In 2019, the National Director of Public Prosecutions (NDPP) obtained a provisional restraint order in terms of the Prevention of Organised Crime Act and the court appointed Eugene Nel as a legal representative or curator bonis to manage the finances, property or estate of the companies.
This was after the prosecuting authority identified more than R1-billion as alleged proceeds of crime linked to the company’s remarkable run of luck when dealing with state-owned entities. Money assets worth R1.6-billion are under restraint following a court order.
Regiments Capital, its owners and shareholders have been accused of being central to the Gupta wave of state capture. Regiments Capital is in liquidation.
In the affidavit, Pillay said the companies and their shareholders have been disadvantaged as they can’t meet their obligations despite not having been charged with any crime.
“The NDPP is yet to institute criminal proceedings against any of the applicants despite the lapse of three years since commencing her investigation and two years since stating under oath in her replying affidavit … that this was imminent.
“There is thus no indication as to when the criminal proceedings will be resolved, and thus declaratory relief is necessary and in the interests of justice to avoid future disputes regarding the nature and ambit of the restraint order, which continues to operate against the applicants,” Pillay said.
At the time of the restraint order, the NPA argued that Pillay, Nyhonyha and Eric Wood were expected to face charges for crimes linked to the unlawful advisory services deals Gupta-linked consultancy company Regiments scored with Transnet, primarily in relation to its purchase of 1 064 locomotives.
The state capture inquiry found that corruption-tainted companies McKinsey and Regiments were awarded contracts valued at R2.2-billion in the space of one year at Transnet without bidding for contracts.
Pillay further said the companies and their shareholders find themselves in a position where they have various expenses relating to the restrained assets. “These include historical and future legal expenses relating to the restrained assets that were historically carried by the estate and would ordinarily be carried by the estate. The applicants, however, require the curator bonis to pay these amounts regardless of whether the applicants’ interpretation or the curator bonis’s interpretation of the restraint order is correct.”
Pillay then asked the court to compel Nel to pay the company’s legal bills as it relates to eight legal matters, claiming a figure of R20-million.
One of the matters relates to a story Sunday World published in February. In that matter, Nyhonhya and Pillay accuse investment holding company Lebashe of reneging on a 2018 settlement agreement to hand over 687 016 Capitec ordinary shares worth about R1.4-billion.
Lebashe, which is owned by Tshepo Mahloele, Jabu Moleketi and Warren Wheatley, holds nearly 9 million Capitec shares worth more than R17-billion, making it one of the lender’s largest shareholders.
Nyhonhya and Pillay argued that their company, Coral Lagoon Investments, was due the transfer ownership of Capitec shares. The two are relying on a 2018 arbitration award handed down by retired judge Robert Nugent.
The NPA intends to oppose the application.
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