Former UniFer executive admits insider trading liability
August 17, 2004
 By Renée Bonorchis
Johannesburg - Just minutes before facing insider trading charges, Kevin Davies, the former company secretary at the UniFer Group, admitted liability on the court house steps and agreed to pay the Financial Services Board (FSB) R487 136.
Normally, people accused of insider trading pay fines without admitting liability. Davies was due in court last week, but, according to Rob Barrow, the chairman of the Insider Trading Directorate, he became one of the few to ever admit liability when he settled.
UniFer was the microlender that collapsed in late 2001 under billions of rands of debt. Davies' fine related to share sales made late in 2001, before the news of UniFer's imminent failure became known to the market.
Barrow said the FSB had now finished its work on the UniFer debacle, but other bodies were continuing their investigations.
Errol Smith, the manager of media services at Absa, said Davies was not, at this point, included in the case that Absa was involved in bringing against certain individuals and companies related to UniFer's demise.
This legal action was one of the steps being taken by Absa in its attempt to recover money after losing more than R1.7 billion thanks to UniFer.
Lantern Financial Services, which is now part of the Absa Group, has instituted the action.
Lantern was one of the companies in the UniFer Group and is claiming from Real People Holdings, Real People Group, Fulloutput 70, True-Mark Financing, Klaret Beleggings, Setprops 94, WACC Group Administrators, Pivot Consolidated, H & H Financing, Swift Consolidated, and Harry van Heerden.
The total of the main claims by Lantern against these parties is R270.1 million, with interest and legal costs to be thrown in.
When possible, the Insider Trading Directorate takes a fine and distributes it to shareholders who were prejudiced by the insider trading.
Yesterday the directorate said there would be no distribution to claimants because the costs incurred in this case had exceeded the settlement amount.
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