Pensioners lose millions of rand in dodgy ‘investment scheme'

A man whose wife left him after finding out he lost money in an alleged investment scam is one of the 124 pensioners who lost millions of their payouts after an Old Mutual financial adviser allegedly advised them to move their pensions to an investment scheme that would give them monthly payouts. 

The pensioners, some of whom died while waiting for justice, had some investments with Old Mutual which they approached for advice upon getting their pension payouts.

They were allegedly referred to Shadrack Manana, the company's financial adviser. However, Manana allegedly convinced them to invest not at Old Mutual but rather with a company called Inhlanhla 1 Investments, trading as Cash For Life, where they were promised monthly payments.

The pensioners said Manana facilitated the process by providing them with account details where they should make the deposits and even completed investment forms at the Old Mutual offices, creating the illusion that the investment was under Old Mutual. They later lost their monies.

Yesterday, Manana and Adv Felani Enock Manana, the company's director, appeared at the Secunda magistrate's court where they face charges that include fraud.

According to the spokesperson for the National Prosecuting Authority in Mpumalanga, Monica Nyuswa, there are 124 victims in total, including some who are now deceased.

"Most of the witnesses are pensioners who were formerly employed at Sasol Secunda," she said.

Frans Mothoangoana, who spent 18 years working at Sasol, said he tried to surprise his wife by investing R40,000 without telling her in 2017, hoping to show her the returns. Mothoangoana said he believed that the advice he got from Manana to invest in Inhlanhla was sanctioned by Old Mutual.

He said he received R3,000 once from the investment. “When my wife found out I kept going to court, she asked what was going on. I explained everything and she left me. Now I survive on piece jobs because I’m not yet receiving an old age pension grant," he said.

Pete Dlamini, who worked at Sasol for 27 years, said in 2018 he invested R200,000 but received only R60,000 back. 

“Life has been difficult,” said Dlamini. “I owe the municipality over R100,000 and haven’t been able to pay for five years. I still have to support my unemployed son and pay R1,500 a month for electricity. They keep postponing the matter and we are left in the dark.”

The head of customer solutions at Old Mutual Personal Finance, Kwena Mothibi, confirmed that Manana was once their employee but was dismissed and debarred on April 30 2018 after a disciplinary hearing into allegations of fraud.

"The case was subsequently handed over to the South African Police Service and a criminal case was opened.

"As part of our cooperation with the authorities, we provided the SAPS with a signed admission of liability from Mr Manana. In his affidavit, he confessed having received compensation for referring clients to Inhlanhla Investments.

"Financial advisers serve as a critical and trusted link between our customers and the investment and risk solutions we provide and advisers within our network are expected to uphold the highest standards of integrity and always act in the best interests of their clients.

"By referring clients, he did not act with integrity or objectivity. We recognise that this is a difficult situation for those customers impacted. The investigation determined that Mr Manana referred them to Inhlanhla Investments and did not provide financial services on behalf of Old Mutual," said Mothibi.

This, however, is cold comfort for people like Mashabe Moses Tshehla, 69, who have been left to pick up the pieces.

Tshehla, who also worked at Sasol for 27 years, said he invested R100,000 but the only return was R15,000.

“I received a call from Old Mutual’s adviser to come and invest my payout. I only received R15,000 and nothing more. My son is schizophrenic, and we haven’t been able to access a disability grant. I lost my wife this year. Now everything has fallen on my shoulders." 

SowetanLIVE