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Cape fishing firm found guilty of 'using black employees to gain rights'


Cape Town – A Cape Town company that has been found guilty by the Broad-Based Black Economic Empowerment (B-BBEE) Commission of violating the B-BBEE Act by fronting black employees as shareholders to obtain fishing rights, claims it had no intention to defraud anyone.

African Tuna Traders CC, located at Airport Industria, was reported by a former employee, Phephe Khekhe, who told the commission he had been employed as a driver at Africa Tuna Traders CC between 2001 and 2010, when his employment was terminated.

A Cape Town company has been found guilty of fronting black employees as shareholders to obtain fishing rights. Photo: Brenton Geach/African News Agency (ANA) Archives

During that time, Khekhe said, he and and six other black people held 14.29% each as director-shareholders in the empowerment company, Homotsego Trading (Pty) Ltd.

Khekhe said his credentials were used in a subsidiary company, Umbhalo Trading (Pty) Ltd, to secure fishing rights, but received no economic benefits.

Company director Chris Hamel said: “It has never been the company’s intention to defraud anyone and we never knowingly submitted false information at any time.

“The news that Khekhe had reported us came as a bit of a surprise. We’ve had a history and a good relationship with him although some years ago that all seems to have changed. This appears to be a personal dispute.

“The company is audited every year. We will defend ourselves, but we will also comply and correct anything that needs correcting as we have always done over the years.”

Department of Trade, Industry and Competition spokesperson Sidwell Medupe said: “An investigation by the commission revealed that credentials of black employees of seafood processing firm African Tuna Traders CC were presented as black shareholders for the purposes of obtaining the fishing rights that the company uses to trade in the fishing industry.”

The commissioner of the B-BBEE Commission, Zodwa Ntuli, recently flagged the practice of fronting as a critical impediment to transformation. More than 80% of the complaints received by the commission relate to this practice.

Head of corporate finance at investment banking firm Bravura, Soria Hay, said: “In October, the commission sent an unflinching message to those entities attempting to circumvent their transformation responsibilities: there is zero tolerance for entities involved in fronting and/or misrepresentation of their B-BBEE status and such activities will lead to criminal investigation and prosecution."



Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER

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