Allegations that he benefited from a Ponzi scheme are “nonsense”, says First Technology CEO Arnold Sharp.
The allegations are contained in a Sunday Times story, which claims that two companies of which he is a director - Berniebee Investments and First Technology - were paid R792 million by Barry Tannenbaum's scheme. The paper, quoting Noseweek, alleges the firms only invested R12.9 million.
The Sunday Times says it has information from insiders that Sharp is the same person finance minister Pravin Gordhan referred to in his budget speech as having benefited from the dodgy investment deal to the tune of R800 million.
However, Sharp denies these allegations. He tells ITWeb he “cannot talk about it right now, and it's completely wrong and obviously we will be following it up”.
Tannenbaum is the alleged mastermind behind the Ponzi scheme, which saw investors being fleeced of up to R12.5 billion. The investment works like a pyramid scheme and investors are paid out from other investments, which are not used for the purpose advertised. As a result, no real returns are ever realised.
Last week, during his medium-term budget speech, Gordhan said warrants of arrest had been issued for the masterminds behind the scheme, Dean Rees and Tannenbaum.
Tannenbaum, who has escaped to Australia, enticed investors to finance the purchase of medical ingredients, which he claimed medical companies such as Adcock Ingram and Aspen would buy at a big mark-up. He promised investors interest rates of up to 219% a year.
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