Millions lost in Giyani mining deal

A mining deal in the Giyani district worth millions turned out to be bogus. Read more about it here.

“Zietta Janse van Rensburg has ruined us. We lost our vehicles, have very little access to money, and must start over. When we asked her to pay back what she owed us, her words were: ‘Sue me’.'”

This is the reality Franscois Hechter and Björn Booyens of FSB Global Innovative Mining must face after a mining deal fell through.

Notorious Malalane attorney Janse van Rensburg stands central in a bizarre tale of falsified mining prospecting rights, signatures and inexplicable administration processes that has led to criminal charges being investigated by the Special Investigation Unit.

FSB Global Innovative Mining was excited when a mining opportunity in Giyani, Limpopo, crossed their path in June 2022. With 20 years of experience in mining and gold recoveries, it seemed like a perfect fit for their operations. Their company had the equipment and setting up a plant at the once abandoned mine referred to as ‘Birthday’ would be an easy operation.

Now, however, they have lost almost everything in a deal that was, as Lowvelder’s investigation unravelled, never legitimate.

“We were approached by Eddie Kloppers and Freddie Scheepers of Faith Gold Mining, who offered us an opportunity to be part of a gold mining project in the Giyani district.” FSB would not only source funding, but had the expertise and equipment to get the project started.

The mining site called ‘Birthday’. Photo: Supplied.

Kloppers on Wednesday told Lowvelder that they had reached out to FSB to partner with them in the deal. The original mining agreement was set up between Faith Gold Mining and Junox, a business Janse van Rensburg claims she has a minor interest in, in lieu of some work she had done.

According to Janse van Rensburg, she drafted the agreement between Faith Gold and Junox, which stipulated that Faith Gold was not allowed to subcontract to a third party without the consent of Junox. “Faith Gold, without permission, entered into an agreement, which I have never seen, with FSB, who funded and established a plant on the site,” said Janse van Rensburg.

Kloppers disagrees that FSB was subcontracted, and said it was clearly communicated to Janse van Rensburg that FSB was in a partnership with them.

Hechter said FSB was led to believe that the initial prospecting holes were drilled and that the results showed good grades of gold. The ‘grade’ of a mine indicates the grams per tonne that could be extracted, which equates to the potential income of the mine.

The Manombe royal family were cited as beneficiaries in all agreements and, according to Janse van Rensburg, their dissatisfaction was partly the reason why the deal fell through.

“We only found out of FSB’s involvement after the dispute between Faith Gold and FSB and/or the community. To date, no one has seen the agreement between FSB and Faith Gold, or the agreement between FSB and/or Faith Gold and/or the community, although I have requested it.

“FSB implored us to consider entering into an agreement with them directly, but as a condition on the agreement, FSB had to enter into an agreement with the community to correct the relationship.”

Payment problems or unsanctioned agreement?

In the meantime, Faith Gold’s Kloppers paid the initial R50 000 rehabilitation fee as well as a further R250 000 in November 2022 to make sure their contract stays intact. Shortly after, he said he received a letter cancelling their agreement with Junox because they [Faith Gold] could not keep up with the monthly payments the agreement dictated.

Janse van Rensburg commented: “FSB entered into an unauthorised agreement with Faith Gold. There was a dispute between FSB and Faith Gold and/or the community, which is irrelevant to Junox. Junox terminated the Faith Gold agreement upon learning of the unsanctioned agreement with FSB. Although there was no obligation, we assisted FSB to enter into a new agreement with Junox. The dispute with the community created an impasse we could not overcome.”

Kloppers told Lowvelder: “This was the project that would secure my family’s future. I have lost everything and am currently working as a waiter to earn an income.”

FSB forges ahead

FSB took the opportunity to continue with the project and on December 20, 2022, signed an agreement with Junox. Upon signing the agreement, FSB had to pay R120 000 as a contract initiation fee.

Thereafter, R30 000 per month had to be paid for the right to operate on the five hectares of land and 30% of any proceeds of gold and by-products were to be paid to Junox.

The agreement further made provision for FSB to pay royalties and/or taxes in terms of the Mineral and Petroleum Resources Royalty Act 28 of 2008.

While FSB has had access to the site since June 2022, the agreement stipulated that production would officially start on January 15, 2023.

Apart from investing a large amount of their capital, FSB also had a group of American investors who provided funding. Hechter said they were ready to move to the site and Janse van Rensburg provided proof of Junox’s prospecting rights in the form of a letter from the Department of Mineral Resources.

In January, before official production commenced, FSB faced a threat to their operations when the community’s demands for payments increased. Faced with no income, FSB informed Janse van Rensburg that the community would prevent them from entering the premises if their demand for 9.5% of nett sales value, on top of the royalties agreed upon, were not met. Requests for Janse van Rensburg to intervene fell on deaf ears, said Hechter.

FSB engaged with a legal team that investigated the deal and all documents. A company search showed that Junox was a shelf company and that the letter from the Department of Mineral Resources was not legitimate.

Lowvelder requested Janse van Rensburg to provide the letter granting Junox prospecting rights, which she sent with the note: “I have annexed the letter of grant, which includes the necessary departmental reference. You will appreciate from the documents provided that Junox is the valid right holder.”

Lowvelder presented the letter to the Department of Mineral Resources and spokesperson Azwi Mulaudzi replied: “Please note that the letter attached in this email is not authentic. It is a fake letter and is not coming from this department. According to our investigation, if you check the first page, it has a lot of errors using our former official Tshifhiwa Mukwevho as the enquiries.”

The mining site called ‘Birthday’. Photo: Supplied.

Mulaudzi explained that Mukwevho had left the region in 2019 and joined the Springbok office. The wrong email address was also used in the letter.

With reference to the final signed page, the department stated: “The second page is signed by the former DDG, Mr Joel Rapela, who left the department in 2018, and the page was used specifically for his signature, and it has got nothing to do with the content of the fake first page.”

But in a twist, the department said that according to their records, Junox 321 CC was granted the prospecting right LP30/5/1/1/2/10440PR on May 6, 2016, only in respect of a portion of the farm Kopneuzen 230 LT, situated in the magisterial district of Thulamela.

The granted right was never executed or not issued and the granted right has since lapsed.

“The application for Renewal of Mining Permit LP30/5/1/3/2/10871MP belongs to Hectorcorp (Pty) Ltd on the farm Kirsten 212 LT for gold situated in the magisterial district of Thulamela has now lapsed on the 31st March 2023 and is no longer valid. In conclusion, the application for Junox 321 CC and Hectorcorp Pty Ltd is no longer valid.”

Hectorcorp confirmed to Lowvelder that the number used in the correspondence letter to secure the deal with FSB was indeed a licence number owned by them and related to another mining operation.

The mining site called ‘Birthday’. Photo: Supplied.

The status of Junox 321 is also under scrutiny as a company search Lowvelder conducted last week showed that it was still registered as a shelf company and in the process of deregistration. The only member (non-active) still listed is the owner of the shelf company warehouse.

When questioned on this, Janse van Rensburg explained: “The shelf company was purchased in 2011 as a special purpose vehicle. With the purchase, you receive a power of attorney to act and a resignation. It eases a Section 11 process if you keep it in its virginal state until it becomes income-generating or ready for sale. It is common practice.”

A legal opinion Lowvelder obtained on the use of the shelf company differs and states that a shelf company cannot be used to enter into an agreement unless the listed member provides consent to do so. Because it was in the process of deregistration at the time, such consent could not have been provided. Junox CC 321’s final deregistration date was on January 20, 2024.

In a second opinion, it was explained that: “A special purpose vehicle is a company that is purchased by a holding company for a specific purpose or project. Janse van Rensburg therefore cannot say that Junox is her or her company’s SPV, because it was registered in someone else’s (shelf company seller) name and is moreover subject to a deregistration process.”

Hechter said that in his last phone call to Janse van Rensburg, he had begged her to repay the R300 000 FSB had paid into her trust account, to which she responded: “Sue me.”

A total of R4m in investors’ money has been lost in the bogus deal.

LPC lodges contempt of court application

The Legal Practice Council (LPC) has confirmed that it has lodged an urgent application for contempt in the high court against Janse van Rensburg, after her appearance in a court case in front of Judge Brian Mashile on May 22, while her law licence was suspended.

The papers were issued last week and the LPC is awaiting a hearing date.

Read original story on www.citizen.co.za

 
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