VIDEO & PHOTO GALLERY: Sean Westcott granted bail on condition that Tovasize shuts down

Friends, family and staff of Sean Westcott, occupied seats to the front of the public gallery at Vryheid Magistrate’s B Court on Thursday morning.

Behind them, the stifling hot, airless courtroom was filled to capacity with ‘victims’ of the alleged pension fund tracing scam who are eager to see Sean, “rot in jail.”

Among them is Mkhanyiseli Mhlongo, a community representative who is working with the Hawks to see that, “justice is served.” Mr Mhlongo, himself, paid the R1 500 admin fee to Donafin (now operating as Tovasize) after being told that he had R280 000 in unclaimed pension funds due to him.

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When the Vryheid Herald conducted a quick and free check on the FSCA (Financial Services Conduct Authority) website nearly 18 month later, it was discovered that he had no money due to him.

Mr Mhlongo is committed to attend as many court appearances in the case against Sean Westcott as he can, to see that, “nobody else is fooled,” in the same way that he was. He was saddened and angry to see so many vulnerable people queuing at the Tovasize premises, knowing what they were in for after finding out that he had been duped.

Outside are many more of the alleged scam’s victims, who could not find space in the public gallery, but are waiting patiently in the corridor to hear the outcome of the bail application that Sean’s attorneys will present to court on his behalf.

Patience and a kind of grim determination keep people from leaving, despite the fact that it is a more than two hour wait for the investigating officer, Col S Msibi, to arrive from Newcastle before the bail application can proceed.

Col Msibi greets with resigned disappointment, the fact that the prosecutor, who came all the way from the Durban Commercial Crimes Court, Advocate Mlungisi Magwanyana, has decided not to oppose bail.

He had hoped to put forward an argument as to why he felt bail should be denied, but will not be getting that opportunity.

The bail application began just after 11.30am, with Sean already in place in the docks.

“The state indicated at the last appearance, that the bail application was opposed. There was other information that needed to be investigated before we made the decision to oppose bail or not. We are now satisfied that the accused can proceed with bail unopposed. The state is not opposing bail in this matter,” began Adv Magwanyana.

He continued to describe the crime that Sean was being accused of, indicating to the court that he believed that Tovasize was running a Ponzi scheme, “The accused is alleged to be a director in the company, Tovasize, which was acting as a tracing agency in Vryheid and the surrounding areas like Nongoma, Ulundi, and I am told that there was information gathered that he wanted to open a branch in Newcastle of a similar nature.

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“He (Sean) told members of the public that he was assisting in claiming their unclaimed pension funds from government pension and other pension funds and it transpired that when business was conducted, this entity was not even registered to conduct such a business. He charged each person to conduct a search for unclaimed money from the pension fund, an amount of R1500 per member.

“In other words, the accused lured public members into believing that he was a tracing agency and that he was tracing their unclaimed money, and eventually, on that belief, they paid him R1500.

We talk about thousands of people. They haven’t received the promised unclaimed pension funds. I am talking about the operation from 2017 to 2019. Members of the public, some were angry, some visited his office as he promised them that they must wait for six months, then that six months would be extended by another six months, and then another six months and he would give a few maybe R10 000 just to keep them believing that there is money, and he knew that eventually there is no money coming in so he was operating like a Ponzi scheme, your worship.”

The state has managed to trace 3 900 ‘clients’ of Tovasize, and there are still more people coming forward to provide statements every day. Working from the 3 900 complainants who have come forward so far, the total cumulative value of the alleged fraud presented at court was calculated at R5.8 million.

After proposing an amount between R70 000 and R100 000 for bail, Adv Magwanyana brought to the court’s attention that there was a disagreement between the state and the defence with regards to what schedule the offence falls under in terms of the Criminal Procedures Act (CPA).

ALSO READ: Tovasize / Donafin kingpin arrested in Vryheid this afternoon

The state believed that the charge should be regarded as a schedule 5 offence, taking into accoount the cumulative value of the fraud committed is more than R500 000. (According to the CPA, fraud that is committed to a value exceeding R500 000 is regarded as a schedule 5 offence.)

However, Sean’s attorney, Bongani Kunene of Shaheed Abdulla’s legal firm, put forward that the charge should be regarded as a schedule 1 offence, taking into account the fact that no individual person had lost more than R1 500 (a relatively small amount, against the cumulative amount of R5.8million).

“The act (CPA) is specific in that it refered to ‘any offence’ over R500 000… Any SINGULAR ‘offence’,”argued Mr Kunene. “Although the charge sheet may allege that one person did this, there is no provision in the act for ‘accumulated amounts’ which might add up to more than R500 000.”

“That act, itself, may need to be amended to take into acount the cumulative effect of each of these offences but my colleague agrees it was R1 500 per person, never more than R1 500 per single act. There was no single offence that added up to more than R500 000. The wording is straight. Courts do not have the power to create new crimes nor invent new penalties. Only parliament can create new offences and abolish old ones. I move that the court finds that this is a schedule 1 offence.”

Adv Magwanyana tried to convince the court otherwise, “My learned friend is saying that it must be a single offence. There is no such thing in the Act. It does not talk of a single offence, and one must also stress in this context that this a continuous offence, a continuous offence with a single intent. It started in 2017 up to 2019 with a single intent. People have been queuing in his offices. This is an offence that has been perpetuated over a period of time, and eventually the accused benfited in excess of millions. So it cannot be said it must be a single offence of R500 000. It has been continuing for a very long period of time with the accused having received monies from the public in excess of R500 000.”

After a short adjournment, presiding Magistrate Jacobus Botha gives clarity on why the correct determination of the schedule of the offence is imperative during a bail application.

“The difference between schedule 1 and schedule 5 is, if it is schedule 1, the onus rests on the state to indicate if bail should be granted or not. Whilst, when it is a schedule 5 offence, then the onus is on the accused to prove on a balance of probabilities that it is in the interest of justice that he be released on bail whether the state is opposed to bail or not. It determines the proceedings that needs to be followed,” explained Mr Botha.

Mr Botha cited a case from 2003 as he continued, “If you read the wording of schedule 5, it states, ‘an offence of fraud where amounts of R500 000 is involved’. The overriding word ‘offence’ is the one that must be followed. If the overriding word ‘offence’ is followed then these offences that the accused is being charged with, which are 3900 cases of fraud, then falls not within the ambit of schedule 5. It is cumulative and the cumulative value of R5.8million, should be ‘an offence’ of more than the value of R500 000.”

Taking these facts into consideration, Mr Botha determined that the case against Sean did not fall within the ambit of a schedule 5 offence, and allowed the bail applcation to continue as a schedule 1 case.

Bail was then set to R70 000 and the case was postponed to May 20. Sean was released with a stern warning from Mr Botha to abide by the conditions to his bail.

Sean must appear on the dates and places as stipulated by court.

He has to report at the police station in Vryheid every Tuesday between the hours of 8’o’clock in the morning and 4’o’clock in the afternoon.

He is to remain in the magisterial district of Vryheid and can only leave the magesterial district of Vryheid with written consent from the investigating officer.

Finally, he is not allowed to operate the entity, Tovasize, for the period that this matter is enrolled.

“If you pay this bail and you do not adhere to these conditions, a warrant for your arrest will be authorised. You will be arrested and kept in custody until the matter has been finalised and your bail will be forfeited to the state. It is also a criminal offence that you can be charged for, for not complying to these conditions,” warned Mr Botha.

Sean nodded respectfully as each of the conditions of bail was explained to him.

At the conclusion of the bail hearing, there were no relieved hugs or grateful handshakes, Sean and his family chatted in hushed tones, wearing grave expressions. Outside, a crowd gathered around Mr Mhlongo, who explained to Tovasize clients that Sean had been granted bail. More people were gathered around Col Msibi, who encouraged those who hadn’t already given their statements, to do so at the police station.

Mr Mhlongo said that, as he was leaving the court, Tovasize staff, began mocking him, saying that he couldn’t stop them because they would just change the company name to something else and continue operating the same as before. He immidiately relayed this information to Col Msibi.

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