Dishonest Dr DS Grieve Special Inquiry 1 november 2010 (2)


Published on


Published in: Economy & Finance
  • Be the first to comment

  • Be the first to like this

No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide

Dishonest Dr DS Grieve Special Inquiry 1 november 2010 (2)

  2. 2. 1st November 2010 Drs DS Grieves Bridging Solutions (Pty) Ltd (in Liquidation) Inquiry Page 94 Page 96 1 [PROCEEDINGS ON 1 NOVEMBER 2010] 1 EXAMINATION BY ADV NEL: Dr Grieve, you 2 [09:35] COMMISSIONER: I’m told that at our last 2 have attended a similar enquiry previously and questions 3 meeting in August there were cell phones on in the silent 3 were put to you. I’d like to start with the application 4 mode and that interrupted our transcription rather 4 that was launched on your behalf. You’ll find that 5 prejudicially. Okay. Everyone’s cell phones switched off? 5 application if you need to look at it in volume 1 of the 6 Thank you. We are on record today. It’s the 1st November 6 documents. It’s just being brought closer to you. You’ll 7 2010. We are proceeding in our enquiry in the matter of Dr 7 find all of those pages are numbered. If you turn to page 8 DS Grieve Bridging Solutions (Pty) Ltd in liquidation, 8 6 of that bundle that’s the first page of the founding 9 masters reference number T240/2010. Parties present, to my 9 affidavit that was signed by yourself. And you will see10 left we have Mr G.J Nel, who is counsel from the 10 you signed it on page 13. Do you remember deposing to this11 Johannesburg bar. He is instructed by Mr Haroon Laher of 11 affidavit?12 Bowman Gilfillan Attorneys. Assisting Mr Laher we have Ms 12 DR GRIEVE: Sorry, I’m just trying to13 Bianca Masterton and Ms Nabila Kathrada. 13 find – which one are we referring to, this one? Am I on14 Other parties present, we have Mr Dewalt 14 the right page?15 Breytenbach, who is one of the joint liquidators in this 15 ADV NEL: Point again.16 matter of Elcea Car Trustees or just Trust, Elcea Trust. 16 DR GRIEVE: Page 6. It says 6. Sorry,17 Is that correct? Trust. And then creditors who are in 17 I’ve got the wrong page. This one?18 attendance, we have Mrs Rosa Fourie, her son Mr David 18 ADV NEL: Yes.19 Fourie and Mr Andre Besbier are all creditors in this 19 DR GRIEVE: Okay. Yes.20 matter. We have Dr Grieve with us with morning. Good 20 ADV NEL: And that’s the – when I refer21 morning, Mr Grieve. And then of course we have Mrs Robin 21 to 13 I’m saying that’s the page where you signed it. Do22 Cohen who is doing the transcription for us. Is there 22 you recall deposing to this affidavit?23 anything housekeeping that you need me to attend to, or can 23 DR GRIEVE: Yes.24 I place Dr Grieve under oath? 24 ADV NEL: Okay. Now, you also during the25 ADV NEL: We’ve got nothing from our 25 last proceedings conceded that a statement that you’d made Page 95 Page 97 1 side, thank you. 1 in your application for voluntary surrender to the effect 2 COMMISSIONER: Dr Grieve, you have been 2 that you paid R21 million to Presidium was incorrect. Do 3 with us before. Apparently if I understand correctly your 3 you remember that? 4 legal representative, Mr Willem Storm is ill and is unable 4 DR GRIEVE: I remember that. I still 5 to attend today. Is that correct? 5 want to comment on that if I may. It was in Afrikaans and 6 DR GRIEVE: That’s correct. 6 I was assisted with that. And if I read that paragraph in 7 COMMISSIONER: Okay. Do you have any 7 Afrikaans I still beg to differ with the interpretation of 8 objection talking to us without him being present? 8 that. 9 DR GRIEVE: I have no objection. 9 ADV NEL: Dr Grieve, I don’t mean to10 COMMISSIONER: Okay. Well, let me then 10 interrupt you. I’m just trying to help you.11 just place on record that you must please bring it to my 11 DR GRIEVE: Okay.12 attention the moment you feel uncomfortable. I will try 12 ADV NEL: Can you turn to page 15 of that13 and assist you where I can. If needs be we can perhaps 13 bundle in front of you. Sorry, Madam Commissioner, just to14 stand down and you can have a chat with Mr Storm at various 14 refer Dr Grieve to the paragraph he’s referring to.15 intervals if you feel the need to do that. Otherwise let’s 15 COMMISSIONER: I accept that.16 proceed. If I remember correctly did you have an objection 16 DR GRIEVE: Okay, if you can help me out17 in taking the oath? 17 there again. Which paragraph was it?18 DR GRIEVE: No objection, no. 18 ADV NEL: Um -19 COMMISSIONER: No objection. Please 19 DR GRIEVE: Ja, I’ve got it, it’s fine.20 raise your right hand. Do you swear that the evidence that 20 ADV NEL: I think it’s paragraph 10.2.21 you’re about to give will be the truth, the whole truth and 21 DR GRIEVE: Okay. If I may make a22 nothing but the truth, so help me God? 22 comment on this. I feel, and even if this is incorrect23 DR GRIEVE: I do. 23 then I have to accept that it’s incorrect, fair enough.24 COMMISSIONER: Thank you very much. 24 But I still feel my intent here – and if I was going to say25 Please proceed, Mr Nel. 25 what you say I’m saying I would have worded it slightlyTel: 011 021 6457 Fax: 011 440 9119 RealTime Transcriptions Email:
  3. 3. 1st November 2010 Drs DS Grieves Bridging Solutions (Pty) Ltd (in Liquidation) Inquiry Page 98 Page 100 1 different and said “ek het ‘n bedrag” en nie “ek moes ‘n 1 liquidate the combined estates of all of the applicants.” 2 bedrag”. To me it’s a little bit ambiguous, yes, fair 2 That was your purpose in launching this application. 3 enough. I accept that I did not pay that. That was not 3 DR GRIEVE: That’s correct. 4 the intent of this paragraph. If I mean it to say that I 4 ADV NEL: And at a later stage you filed 5 had paid that I would have said “ek het” en nie “ek moes”. 5 a supplementary affidavit. I can refer you to that. 6 Okay. But if your interpretation is otherwise, I have to 6 Sorry. You’ll find that starts at page 32. And if you 7 concede to it, yes. 7 turn over to page 33 in paragraph 3 you say, “It has come 8 ADV NEL: It’s not a question, Dr Grieve, 8 to my attention that my personal estate is not part of the 9 of my interpretation. What we’re trying to get at here is 9 application, being one of the applicants. I am indeed10 what factually occurred. 10 insolvent and I would beg the court to add my personal11 DR GRIEVE: Okay. 11 estate for sequestration as part of the group.” So your12 ADV NEL: What I’m getting at is I’m not 12 intention when you launched this application was to13 trying to suggest that you lied in this affidavit. 13 liquidate all of these entities and sequestrate yourself in14 DR GRIEVE: Okay. 14 one go.15 ADV NEL: What I’m trying to get at is 15 DR GRIEVE: Yes, that’s correct.16 you conceded that you had not paid R21 million. 16 ADV NEL: And you regarded all of these17 DR GRIEVE: No, I had not. 17 entities and yourself as one person or entity. Is that18 ADV NEL: And that if there was a 18 right?19 misinterpretation here that has been explained away by you 19 DR GRIEVE: I think that would be20 saying you didn’t pay R21 million. I think where the 20 accurate, ja.21 semantics may have come in was the fact that by the time 21 ADV NEL: Because you say you want to22 you deposed to this particular affidavit for voluntary 22 pierce the corporate veil, and you say all of these23 surrender the book debts had already been sold. So even 23 entities are one and the same. That’s in your mind.24 the suggestion – because what I understand by you saying by 24 DR GRIEVE: In my mind, yes.25 the word “moes” means I had to or I was supposed to. 25 ADV NEL: And by joining yourself to that Page 99 Page 101 1 DR GRIEVE: Yes. 1 application you regarded yourself as also one and the same. 2 ADV NEL: But even that is incorrect, 2 DR GRIEVE: Yes. 3 isn’t it, because at that time that you deposed to this 3 ADV NEL: Now, if you turn to page 10, 4 affidavit the book debts had already been sold for R13.7 4 paragraph 12.9, you say, “I used the second applicant. The 5 million. So all you would have had to pay was R6.3 5 second applicant is Bridging Solutions, the company in 6 million, not so? 6 liquidation and the company whose insolvency enquiry is 7 DR GRIEVE: That’s true. 7 being dealt with today. Do you accept that? 8 ADV NEL: I bring this to your attention 8 COMMISSIONER: You have to say yes or no. 9 for the simple reason that I’m taking you through another 9 DR GRIEVE: Ja, I’m just reading here.10 affidavit, and what we want you to do is if there is 10 ADV NEL: I’m just referring you to who11 something wrong in the affidavit this is your opportunity 11 the second applicant is.12 to put it right. That’s why I said the last time you made 12 DR GRIEVE: I think that’s correct, ja.13 a concession that something in the affidavit was wrong. 13 That’s my understanding, yes.14 You’ve now explained it away. Nobody is blaming you for 14 ADV NEL: Just to assist you, if you turn15 that, if we can say for misinterpretation or 15 back to page 6 you will see in the heading it’s got Dr DS16 misunderstanding. My point is you’re getting an 16 Grieve Bridging Solutions (Pty) Ltd, the second applicant.17 opportunity to set the record straight. 17 You said, “I used the second applicant and the applicants –18 COMMISSIONER: Do you accept that? 18 some of the applicants were spawned prior to 2006 but was19 DR GRIEVE: I accept it. Thank you 19 only activated during and after 2006 – to lend out money as20 kindly. 20 bridging finance and invest part of the profits in21 ADV NEL: So we go back to that original 21 immovable property.” Is that correct?22 affidavit which starts at page 6. If you turn to page 9 at 22 DR GRIEVE: Yes.23 paragraph 11 it says “The purpose of the application is 23 ADV NEL: What has happened to these24 twofold. The first portion is to pierce the corporate veil 24 other entities that were applicants in this application?25 between all the applicants, and the second portion is to 25 DR GRIEVE: It’s my understanding thatTel: 011 021 6457 Fax: 011 440 9119 RealTime Transcriptions Email:
  4. 4. 1st November 2010 Drs DS Grieves Bridging Solutions (Pty) Ltd (in Liquidation) Inquiry Page 102 Page 104 1 they’ve all been liquidated. If I may just add, many of 1 DR GRIEVE: Can you read it for me there? 2 them were just pieces of paper, shelf companies. So there 2 My eyes are - 3 were only two or three that were really active. 3 ADV NEL: “I used the second applicant 4 ADV NEL: And have there been any 4 and the other applicants,” I’m going to ignore what’s in 5 enquiries arising from the liquidation of these entities? 5 brackets, “to lend out money as a bridging finance and 6 DR GRIEVE: No, just the one that we’re 6 invest part of the profits in immovable properties.” 7 at now. 7 DR GRIEVE: These would have been some of 8 ADV NEL: Now, those immovable properties 8 them I believe, yes. 9 that you purchased or you invested part of the profits in, 9 ADV NEL: So, Dr Grieve, even though the10 which immovable properties are those? Can you recall? 10 profits came from legal entities you invested them as11 DR GRIEVE: There was quite a number of 11 profits in properties owned by you in your personal12 properties amongst others that we were developing as well 12 capacity?13 in one of the other entities. And a few investment 13 DR GRIEVE: That was the case in some14 properties as well which the idea is to collect a rental 14 instances, yes.15 income on those. And all of those, it’s quite a list. And 15 ADV NEL: So in your mind there was16 to give you a list offhand now is going to be impossible, 16 really no distinction between a legal entity and yourself.17 but the liquidator definitely has a full list of all of 17 DR GRIEVE: I think that is a fair18 those properties. 18 assumption to make. That is why we brought the application19 ADV NEL: And those are – the list that 19 as a piercing of the corporate veil.20 the liquidator has of those immovable properties, those 20 ADV NEL: Dr Grieve, if that is so then21 were properties you’re referring to in this paragraph? 21 surely the debts and liabilities of those companies must be22 DR GRIEVE: Indeed, yes. 22 yours personally as well?23 ADV NEL: If I can assist you, if you can 23 DR GRIEVE: I actually have no problem24 turn to page 158 of that bundle in front of you. 24 with that, and that is why we tried to bring that25 DR GRIEVE: Okay. 25 application initially as the whole bundle together to try Page 103 Page 105 1 ADV NEL: Do you see those lists of 1 and benefit everybody as well as we possibly could. 2 properties? 2 ADV NEL: Staying with that page, 3 DR GRIEVE: Yes. 3 paragraph 12.10. 4 ADV NEL: Are those the properties you 4 DR GRIEVE: Page 158? 5 refer to in paragraph 12.9? 5 ADV NEL: 10, sorry. I apologise. Page 6 DR GRIEVE: I’m going to have to just say 6 10, paragraph 12.10. You state there, “I initially started 7 yes, definitely it is. I’m looking at it very quickly now. 7 with my own capital in the amount of R5 million which I 8 I’m not sure if that is the full list and it is an 8 lent at an interest rate of 4.5% per month to clients.” Is 9 exhaustive list. This specific annexure that I have in 9 that correct?10 front of me, is this pertaining to a specific entity or me 10 DR GRIEVE: Yes.11 as an individual? 11 ADV NEL: Was that a loan that you made12 ADV NEL: This pertains to - 12 to the legal entities or was this directly to clients who13 DR GRIEVE: Some of - 13 you were assisting with bridging finance?14 ADV NEL: - your voluntary surrender 14 DR GRIEVE: I’m going to sound a little15 application. 15 bit dumb. I’m not quite sure what you mean when you say16 DR GRIEVE: Then these should be the 16 that. Just rephrase.17 properties that were in my personal estate. There were a 17 ADV NEL: Sorry, I apologise. Let me be18 few others in other entities as well, and I’m sure you have 18 clearer. This R5 million -19 them as annexures somewhere here as well. 19 DR GRIEVE: Ja.20 ADV NEL: But do any of these properties 20 ADV NEL: That came out of your own21 on page 158, are they the properties you referred to in 21 pocket?22 paragraph 12.9? Paragraph 12.9 I referred you to at page 22 DR GRIEVE: I’m going to answer that a23 10. 23 little bit in a lengthy fashion. Yes. What we may find is24 DR GRIEVE: Ja. 24 that I had prior to that purchased a property or two and I25 ADV NEL: Do you want to read that again? 25 used second bonds on those properties. But ja, in thatTel: 011 021 6457 Fax: 011 440 9119 RealTime Transcriptions Email:
  5. 5. 1st November 2010 Drs DS Grieves Bridging Solutions (Pty) Ltd (in Liquidation) Inquiry Page 106 Page 108 1 manner out of my own pocket. That would be correct. 1 things. My intention was that in Incorporated I would 2 ADV NEL: Okay. And it then says that 2 develop properties and sell them. And where I wanted to 3 you loaned that at an interest rate of 4.5% per month to 3 keep some of these properties as a long-term investment I 4 clients. What I was trying to get at, the clients that you 4 would actually transfer them to Village Star. And then 5 refer to there, are those the legal entities that were the 5 obviously those that were in my name were done prior to 6 applicants, in other words Bridging Solutions? 6 that way of thinking. So that was the train of thought for 7 DR GRIEVE: No. 7 that. Does that answer your question? 8 ADV NEL: This was directly to clients 8 [09:55] ADV NEL: Sorry, just one second. How 9 who needed finance? 9 did you finance all of these different development projects10 DR GRIEVE: That is correct, ja. 10 and purchasing of houses?11 ADV NEL: So at that stage you were 11 DR GRIEVE: With bank finance.12 running a bridging finance company in your own personal 12 ADV NEL: In the name of each entity?13 name, personal capacity? 13 Did each entity go and apply for a loan? Who applied for14 DR GRIEVE: Yes. 14 the loan?15 ADV NEL: And would that have been until 15 DR GRIEVE: Well, either myself or the16 2006 when all these companies were activated as you say? 16 entities, yes, and I would have had to stand surety for an17 DR GRIEVE: I’m not 100% sure of the 17 entity as well.18 exact date when we started to let’s say roll the can we 18 ADV NEL: And that entity, particular19 call it a loan book or a debtors book or a factor book. 19 entity that applied for a loan, would only use that loan20 When we started to roll it into that entity would have been 20 for its own purposes?21 probably around about 2006, ja. But I don’t think I drew 21 DR GRIEVE: If there was any surplus in a22 an exact line and said, right, from today all of it will be 22 loan, I would probably throw that into the bridging book to23 in here. It was staggered in. 23 generate more capital and earning capacity in the bridging24 ADV NEL: In clause 12.11 you say, “I 24 book.25 used part of the profit to buy properties and develop them 25 ADV NEL: So when you got a loan from, Page 107 Page 109 1 for the purpose of reselling it for a further profit.” Are 1 let’s say for example Standard Bank to purchase a property 2 those the immovable properties I referred you to earlier or 2 in the name of Village Star Trading, you asked for R2 3 are there others? 3 million mortgage bond finance, they give you R2 million, 4 DR GRIEVE: There are others. 4 you manage to negotiate with the seller for 1,8 million, 5 ADV NEL: And you’ve given all of the 5 you buy for 1,8 and you take the other 200 000 and just 6 descriptions and identities of those properties to the 6 transfer it to another entity? 7 liquidator? 7 DR GRIEVE: Basically yes and I would use 8 DR GRIEVE: Yes, I have. They would have 8 that to bridge, ja. 9 fallen in another entity or two entities. 9 ADV NEL: So there was no corporate10 ADV NEL: Do you have the names of those 10 governance in any of your entities, that’s what it sounds11 entities? 11 like to me.12 DR GRIEVE: There were properties in Dr 12 DR GRIEVE: Fair enough.13 DS Grieve Incorporated, or Dr David Grieve Incorporated. 13 ADV NEL: In paragraph 12.12 on page 10,14 There was a name change that was done a couple of years 14 you say the buying and selling of the properties was done15 prior. I’m not quite sure what the title deeds would say. 15 through any one of the applicants. Do you see that?16 Then there were two or three in Village Star Trading. 16 DR GRIEVE: Yes.17 ADV NEL: Can I ask you, why did you 17 ADV NEL: And then you carry on and you18 bother with all these entities if as far as you were 18 say, “And the bond instalments on the properties would be19 concerned they were all really just you? 19 paid by any one of the applicants.” Now, that statement20 DR GRIEVE: It’s a very difficult 20 actually fits in well with what you’ve just told me.21 question to answer because the truth is I don’t really 21 DR GRIEVE: Ja.22 know. I think one of the initial thoughts was I lent my 22 ADV NEL: It seemed to me it was23 ears out to legal advice at an early age and some of these 23 irrelevant to you who was who. You would buy it in the24 entities were registered because of advice received and 24 name of Village Star, you would pay for it in the name of25 probably not well interpreted initially. So I had these 25 Dr David Grieve Incorporated –Tel: 011 021 6457 Fax: 011 440 9119 RealTime Transcriptions Email:
  6. 6. 1st November 2010 Drs DS Grieves Bridging Solutions (Pty) Ltd (in Liquidation) Inquiry Page 110 Page 112 1 DR GRIEVE: What I’d like to add there, 1 ADV NEL: Well, you know it’s – I sort of 2 yes, I have no problem in accepting that, but in terms of 2 vaguely understand your explanation, because it’s like 3 Village Star, I would actually pay those bonds from Village 3 saying to me my car is worth R200 000, I’m selling it for 4 Star and the Incorporated, I would pay those bonds from the 4 R100 000, so when somebody asks me, “How much did you sell 5 Incorporated account, but then there was like Nanene cc 5 it for, I say R200 000.” I mean didn’t you sell this for 6 where I had some units – sectional title units, and those 6 R13,7 million? 7 are paid out of my private account because there was never 7 DR GRIEVE: Yes, I did. 8 a trading account Nanene cc or a current account, or a 8 ADV NEL: It doesn’t matter what it was 9 cheque account, whatever you want to call it. And the same 9 worth, that’s what you sold it for and that’s what you say10 with bonds that were in a trust, I obviously paid them out 10 here, “I sold it for more than 16 –11 of my private account for the same reason. There was no 11 DR GRIEVE: Ja, then this is –12 current account or saving account. So I think that does 12 ADV NEL: It’s wrong.13 answer your question. 13 DR GRIEVE: It’s wrong, it’s a mistake.14 ADV NEL: And let’s just, now, let’s take 14 ADV NEL: Now, let’s start at the bottom15 one of those examples you’ve given us of Nanene close 15 of page 11, paragraph 12.19, you say that you set out some16 corporation, when you advanced – well, when you bought 16 of the difficulties that were faced. You say the effect of17 something in the name of Nanene and you say it had no money 17 this, is that, “The applicants cannot pay its debts and18 or it didn’t have an account, would you record the money 18 cannot repay the investors. The applicants are19 that you paid on behalf of Nanene as a loan account from 19 commercially insolvent. The monthly financial commitment20 you to Nanene? 20 of the applicant, are in the region of R1 million per21 DR GRIEVE: I should, I’m not sure if we 21 month.” Can you elaborate on that?22 ever did that. 22 DR GRIEVE: Yes, the commitment of the23 ADV NEL: Who’s we, Dr Grieve? 23 applicants would include all the entities as well as24 DR GRIEVE: Well, myself and whoever was 24 myself, and because we had obviously had a string of25 my auditor at the time. 25 development properties that we were holding onto as well Page 111 Page 113 1 ADV NEL: You see this isn’t a witch 1 and we were caught out very badly with those properties, 2 hunt, but what we’re trying to get at is, where’s all the 2 because we had finished a number of properties and as we 3 money gone? There was a lot of money here. People are 3 released them in the market, the banks turned around and 4 trying to find out where the money’s gone. 4 sort of suddenly came up new playing rules in the economy 5 DR GRIEVE: And I accept that. 5 at that stage and everybody had to start putting in 15% and 6 ADV NEL: And that’s why I’m saying to 6 20% deposits in the price range that we were developing in. 7 you, it’s not a personal witch hunt, I’m just trying to 7 So we suddenly got stuck with stocks that we were 8 find out what happened and it’s made quite difficult by the 8 struggling to move. So I had a number of bonds to service 9 fact that you’re telling us that there was no corporate 9 with that, a multitude of bonds to be blunt about it, as10 governance, so we’re just trying to establish what 10 well as then certain stands that we still intended to11 happened. At page 11, paragraph 12.16, the last sentence, 11 develop, which we were unable to develop, because we12 you say, “I sold the part of debtors book to this investor 12 couldn’t find buyers as a result of the deposits that they13 as part of payment of their investment in the amount of 13 had to now start placing, which was not the case obviously14 more than R16 million.” Now that investor is Presidium. 14 a few months prior to that. So that put us under15 Is that a correct statement? 15 tremendous pressure just there and to the point where16 DR GRIEVE: Yes. 16 strange things were happening in the marketplace and that,17 ADV NEL: I thought you sold it for R13.7 17 we even had where we had buyers on file with approved18 million. 18 finances and I recall one Standard Bank guarantee that was19 DR GRIEVE: I did sell it for R13.7, I’m 19 given to the attorney doing the transfers, that was20 not sure why I let R16 million slip through here. The only 20 actually withdrawn for a while, which was unheard of before21 thing I can add there, I think that the actual face value 21 that and because I was in the bridging space as well, I22 of the part of the books that was sold, was perhaps around 22 picked up that in my book there was a few of those things23 about R16 million, if that makes sense, and it was sold at 23 where the banks actually started to withdraw approvals and24 a discount. I’m not quite sure if that is accurate. We’d 24 grants.25 have to go and look at what the face value was there. 25 So, ja, we had that, then obviously I had toTel: 011 021 6457 Fax: 011 440 9119 RealTime Transcriptions Email:
  7. 7. 1st November 2010 Drs DS Grieves Bridging Solutions (Pty) Ltd (in Liquidation) Inquiry Page 114 Page 116 1 still carry the guys that were physically building, the 1 ADV NEL: So if the property is never 2 workers – the labourers that were doing the building work, 2 sold, then you’ve got no course of action to get your money 3 I had to carry them and the equipment, some of it was 3 back? 4 financed, I had to carry that and then obviously I still 4 DR GRIEVE: Well, you’re going to follow 5 had to carry the guys that I feel very bad for, the 5 a legal process and you’re going to fight for it and you 6 investors on bridging side, because suddenly where I had a 6 can also hopefully give the attorney that gave the solid 7 lot of income, it was taken away, or I lost it, whichever 7 undertaking a bit of stick in the process as well. 8 way you want to call it, and I suddenly had a large amount 8 ADV NEL: Well, you can’t you see, Mr 9 of pressure. And at the same time there’s was a period 9 Grieve, because his undertaking to you was when this10 there were Presidium hit me with the penalty interest, 10 property is transferred, I will pay you. Isn’t that so?11 which was, for me personally it was crazy, I mean there was 11 DR GRIEVE: In many of the cases, yes.12 no ways I could afford that either and that penalty 12 ADV NEL: I mean because he’s the13 interest really hurt big time. 13 conveyancing attorney. So he says, “I’ll pay you when the14 ADV NEL: What portion of that million 14 property is transferred and the selling price is made15 Rand was DS Bridging Solutions monthly liabilities? 15 available, that’s when he pays you. That’s his only16 DR GRIEVE: That’s a difficult call. I 16 obligation to you.17 think about 200, 250, I’m rounding off, I’d have to go and 17 DR GRIEVE: Okay.18 work it out clearly, but in that ballpark. 18 ADV NEL: But now the purchaser doesn’t19 ADV NEL: I just want to get back to one 19 get a bond, so the conveyancing attorney never gets to20 example you gave just now about the Standard Bank guarantee 20 transfer this property. The money never goes to the21 being withdrawn, you raised that during the last inquiry as 21 conveyancer, so he never has to pay it to you, but in the22 well and then explained it as one of the reasons you were 22 interim you’ve paid this money out to the seller, isn’t23 struggling getting bridging finance in, because the 23 that so?24 purchaser got a bond and that bond was declined, or 24 DR GRIEVE: That can happen, yes.25 withdrawn. 25 ADV NEL: So surely you go to the seller Page 115 Page 117 1 DR GRIEVE: Withdrawn, we actually had an 1 and say, “Pay the money back.” 2 issue with some of the attorney firms as well. 2 DR GRIEVE: Yes. 3 ADV NEL: Ja, sure, but just that example 3 ADV NEL: Did you do that? 4 - well, what I want to put to you is this, the bridging 4 DR GRIEVE: On occasion, yes. 5 finance that you advanced, isn’t to the purchaser, it’s to 5 ADV NEL: Were there occasions that you 6 the seller, isn’t that so? 6 advanced money to sellers and that you weren’t paid and you 7 DR GRIEVE: In most of the cases, yes. 7 didn’t go and ask for it back? 8 ADV NEL: I mean your classic of bridging 8 DR GRIEVE: I can’t recall such an 9 finance is, somebody sells his house and he doesn’t want to 9 occasion. I would look at the attorney first and hopefully10 wait two or three months for the bank to – for the actual 10 get success from that, but there were occasions when I11 lodgement of transfer when the payment comes through and he 11 wasn’t paid back.12 comes to you and he says, “I’ve got a surplus of R300 000, 12 ADV NEL: You see, I understand that13 I’ll sell it to you for R270 000. The attorney is going to 13 you’d look to the attorney in the normal circumstances14 pay you the 300 000 when transfer gets lodged.” So how 14 where the property transfer goes through, and I know that15 does it affect you if the buyer doesn’t get a bond, because 15 there are occasions where property transfers to through and16 it’s the seller that you’re financing, not the buyer? 16 the attorneys don’t pay you for whatever reason, but the17 DR GRIEVE: Well, it still affects me, 17 example you gave, as being part of the reasons why you were18 because that’s where I’m getting my money from to settle. 18 – why bridging solutions was suffering, can’t be a good19 ADV NEL: But it’s secured. 19 example.20 DR GRIEVE: It’s supposed to be, yes. 20 DR GRIEVE: No, it’s –21 ADV NEL: But it’s secured by the 21 ADV NEL: What I’m saying to you is, the22 immovable property. 22 property was never transferred, so the seller always owed23 DR GRIEVE: If you register a bond over 23 you that obligation, didn’t he?24 it, but we normally accepted undertakings from the 24 DR GRIEVE: Ja.25 attorneys. 25 ADV NEL: Now, did you go and collectTel: 011 021 6457 Fax: 011 440 9119 RealTime Transcriptions Email:
  8. 8. 1st November 2010 Drs DS Grieves Bridging Solutions (Pty) Ltd (in Liquidation) Inquiry Page 118 Page 120 1 from the seller when that happened? 1 Solutions. 2 DR GRIEVE: I’d have to think about that? 2 ADV NEL: You see, that’s really the 3 ADV NEL: But, Dr Grieve, if you didn’t – 3 point, Dr Grieve, because to the outside world, you held 4 DR GRIEVE: We have tried, we did surely 4 out as being separate entities, but to yourself you 5 try, yes. 5 regarded them all as one. You regarded them as being you, 6 ADV NEL: You made an attempt to – 6 not so? 7 DR GRIEVE: Yes. 7 DR GRIEVE: Ja. 8 ADV NEL: Paragraph 12.21 on page 12, you 8 ADV NEL: SO there were distinctions, you 9 say, “”The applicant’s business dealings are so intertwined 9 simply didn’t follow those distinctions. Would you agree?10 with each other, that even I have difficulty in dissecting 10 DR GRIEVE: That there are distinctions,11 the business dealings,” that’s correct. We’ve already 11 yes.12 heard from you why that was. You treated all the entities 12 ADV NEL: And that you didn’t follow13 as essentially yourself. 13 them?14 DR GRIEVE: Yes. 14 DR GRIEVE: Ja, I’ll have to concede15 ADV NEL: Dr Grieve, thinking back, do 15 that, yes.16 you think you were negligent in your dealings with these 16 COMMISSIONER: So how is that not17 entities? 17 negligence, forgive me?18 DR GRIEVE: The term negligence is a very 18 DR GRIEVE: Negligent or – I don’t know.19 strong term and I felt that, in a way, that it was still 19 COMMISSIONER: Would you say negligence20 going okay and I think towards the end when we started 20 is a strong word?21 getting bad deals coming through and we started having 21 DR GRIEVE: Ja, I think that –22 trouble, then it became difficult to find out exactly why, 22 COMMISSIONER: Which word would you23 and that stuff, but I don’t think initially I was 23 choose?24 negligent, I just didn’t, at that stage, see that it was 24 DR GRIEVE: A mistake, mismanagement25 necessary to split the entities as such. In retrospect 25 perhaps, but negligence is very strong. Page 119 Page 121 1 now, yes, but at that stage, no. 1 COMMISSIONER: Thank you. You may 2 ADV NEL: So you say it all went well if 2 proceed. 3 you were still operating and you didn’t draw any 3 ADV NEL: Thank you, Ma’am. Would you 4 distinction between these entities, do you think that would 4 regard it – your conduct as being reckless? 5 be okay? 5 DR GRIEVE: Which conduct are you 6 DR GRIEVE: Well, I was trying to head 6 referring to? 7 towards the distinction at that stage and we were trying to 7 ADV NEL: The conduct of drawing no 8 find, as you’ll be aware of, it’ll come out again later, we 8 distinction between separate legal entities that you’ve 9 were trying to find a new corporate funder and obviously if 9 held out to the outside world as being separate legal10 that guy did come on board, we would have had to make the 10 entities –11 full distinction. So – 11 DR GRIEVE: As reckless?12 ADV NEL: But, Dr Grieve, when Presidium 12 ADV NEL: Yes.13 came on board and advanced you money in terms of the credit 13 DR GRIEVE: I wasn’t of that opinion, no.14 facility agreement, they advanced it to a particular legal 14 ADV NEL: Now, I’d like you to, in that15 entity, Bridging Solutions. 15 bundle in front of you, turn to page 38. Are you there?16 DR GRIEVE: Ja. 16 DR GRIEVE: Yes.17 ADV NEL: So there was already a 17 ADV NEL: That’s an application by18 distinction at that stage. 18 William Grieve to have Dr DS Grieve Bridging Solutions19 DR GRIEVE: Yes. 19 Limited placed under winding up or liquidation. You’re20 ADV NEL: But as far as you were 20 aware of that application?21 concerned and from what you’ve just told us, you personally 21 DR GRIEVE: Yes.22 drew no distinction? 22 ADV NEL: In no – was Dr William Grieve,23 DR GRIEVE: That be true, with exception 23 is your stepbrother or half brother?24 when we were dealing with Presidium, we – that normally – 24 DR GRIEVE: Half brother, yes.25 not normally, I believe that all flowed through Bridging 25 ADV NEL: Now, your own half brother sawTel: 011 021 6457 Fax: 011 440 9119 RealTime Transcriptions Email:
  9. 9. 1st November 2010 Drs DS Grieves Bridging Solutions (Pty) Ltd (in Liquidation) Inquiry Page 122 Page 124 1 a distinction between you and Bridging Solutions, do you 1 you’re flabbergasted, is this not something that was 2 accept that? 2 discussed with you by your legal representative? 3 DR GRIEVE: Yes. 3 DR GRIEVE: This happened in end of 2009 4 ADV NEL: This application that was 4 and as far as I recall, we did the application on all – 5 launched, ultimately resulted in an order granted on the 5 this is just sort of very quick my understanding of it, we 6 25th of February 2010 in terms of which Bridging Solutions 6 did the application on all, and somebody put an objection 7 was wound up. You’ll find that order at page 34, sorry, 7 in on that and that wasn’t somebody driving this inquiry, 8 just back a couple of pages. 8 it was somebody else, and then we redid the application on 9 [10:15] ADV NEL: Do you accept that that’s what 9 an individual basis and that was, according to my10 occurred? 10 understanding, was successful, and I know that William11 DR GRIEVE: I’m actually looking at this 11 Grieve was also busy with something, but I was not aware12 now. I am a little confused. I was actually under another 12 that he had an effect in the process we had already13 impression here. I was actually under the impression that 13 started, so it is a bit news to me, ja.14 it had been wound up before this, now I’m actually a little 14 ADV NEL: Just to assist you, your15 bit confused. Can I ask some commentary from – I don’t 15 understanding is to some extent correct in the sense that16 know it I may, but the liquidator, can he help me on this 16 the company was initially wound up, Bridging Solutions by17 one? 17 way of a special resolution, which I refer to as a18 ADV NEL: Let me try and assist you and 18 voluntary winding up.19 if I can’t – 19 DR GRIEVE: Okay.20 DR GRIEVE: Sorry, I’m a bit confused 20 ADV NEL: But the creditors, an in21 now, because I know there was an application – 21 particular William Grieve, wasn’t satisfied that the22 COMMISSIONER: Gentlemen, one at a time, 22 company should be wound up by way of a special resolution23 please. Let Mr Nel finish his sentence and you’ll be given 23 and he brought an application in February 2010 for a24 an opportunity to reply. Thank you, Mr Nel? 24 compulsory winding up. The result of that type of winding25 ADV NEL: Thank you, Madam. Sorry, Dr 25 up is that you can have different types of inquiry, Page 123 Page 125 1 Grieve, I just want to assist you by telling you my 1 including this particular inquiry, and your legal 2 understanding of what occurred. An application was 2 representative agreed with William Grieve’s representative 3 launched, on the company’s behalf – Bridging Solutions 3 that it should be modified so that a section 417 and 4 behalf, for a voluntary winding up of that entity. 4 section 418 inquiry could be held and that this order, 5 DR GRIEVE: Mm. 5 which I’ve shown you, which you’ve got in front of you, was 6 ADV NEL: At about the same time, this 6 then in effect taken by agreement. 7 compulsory application of a compulsory winding up was 7 DR GRIEVE: I’m aware of the inquiry as 8 launched by William Grieve. The application was then 8 such and I know that was discussed. In terms of the 9 modified because the Bridging Solutions was wound up on a 9 documentation, I wasn’t totally up to speed with that, but10 voluntary basis and that application was opposed to the 10 I think, not to sound derogative, but it’s irrelevant, the11 extent that William Grieve was not prepared to accept that 11 fact of the matter is, I was aware there was an inquiry, we12 that company should be wound up on a voluntary basis. A 12 have no problem with the inquiry and we agreed to that and13 court order was then agreed between your attorney and 13 if this is the result of that, well, I, in retrospect,14 William Grieve’s attorney so that this court order which 14 assume I was informed. I just wasn’t aware of the actual15 I’ve shown you now, could be made an order of court, 15 paperwork.16 because if you look at paragraph 2 of that court order, a 16 COMMISSIONER: Okay.17 special resolution was taken, presumably by yourself, as 17 DR GRIEVE: But that’s fine.18 the only director of Bridging Solutions, to wind up 18 ADV NEL: I’d like to refer you to that19 Bridging Solutions and that was converted to a final 19 affidavit deposed to by William Grieve, if you turn to page20 compulsory winding up. Does that assist you? 20 48, William states that, “Early in 2009, David,” that’s21 DR GRIEVE: Ja, it does. I’m still a bit 21 you, “approached me with a proposal to invest in a business22 flabbergasted, because it wasn’t my original understanding, 22 he had quite successfully established.” Do you want to23 but it’s fair. 23 comment on that sentence? Do you accept it?24 COMMISSIONER: Okay. 24 DR GRIEVE: No comment.25 ADV NEL: Is this – you now, you say 25 ADV NEL: He then carries on, “By allTel: 011 021 6457 Fax: 011 440 9119 RealTime Transcriptions Email:
  10. 10. 1st November 2010 Drs DS Grieves Bridging Solutions (Pty) Ltd (in Liquidation) Inquiry Page 126 Page 128 1 accounts, the business was simple and viable, offering safe 1 ADV NEL: Yes we do, Madam Commissioner. 2 and secure investment products and returns.” Do you agree 2 COMMISSIONER: Thank you, lets proceed. 3 with that? 3 ADV NEL: Thank you. Dr Grieve, while 4 DR GRIEVE: Yes. 4 that documentation is just being numbered, I just want to 5 ADV NEL: He says, “At first I was very 5 ask you a brief question. I understand that you have a 6 reluctant to consider any investment in what I perceived to 6 masters of business administration degree, is that correct? 7 be a high risk investment zone. David assured me that the 7 DR GRIEVE: That is correct, Ja. Only 8 country had changed in many ways, with crime and violence 8 recently obtained. 9 receiving priority attention from government authorities 9 ADV NEL: When did you obtain that10 and agencies.” Is that what you assured him? 10 qualification?11 DR GRIEVE: I can’t recall having discussed crime 11 DR GRIEVE: I think the graduation was12 and violence per se, but the rest I’m comfortable with, ja. 12 April of this year. Im not 100% sure of that date. Give13 ADV NEL: He then says, after 13 or take a month.14 unequivocally guaranteeing all investments and reassuring 14 ADV NEL: No that’s fine. When did you15 me that he would personally settled any financial loss 15 commence those studies?16 suffered by me, I agreed to advance an initial amount of 16 DR GRIEVE: We’re now 2010, 2008.17 £100 000.” Is that a correct statement? 17 ADV NEL: And from which institution did18 DR GRIEVE: Yes. 18 you obtain the qualification?19 ADV NEL: He says, “Reserve Bank approval 19 DR GRIEVE: GIBBS.20 for the advance of this loan was obtained on 8 April 2009 20 ADV NEL: Is that the Gordon Institute of21 and the amount was advanced by way of transfer from my bank 21 Business Science?22 account in the United Kingdom on 14 April 2009.” That is 22 DR GRIEVE: Ja.23 what occurred, is it? 23 ADV NEL: While we – you will recall we24 DR GRIEVE: I can’t recall dates, but, 24 dealt with that application launched by yourself on behalf25 yes, it was what occurred. 25 of all those various entities to liquidate them, Im going Page 127 Page 129 1 ADV NEL: Okay, I’m going to refer you – 1 to ask you to just quickly go back to page 10 for me. 2 Madam Commissioner, I just need a moment to find – 2 DR GRIEVE: Ja. 3 COMMISSIONER: Yes, of course. 3 ADV NEL: In 12.9 you said, and Im going 4 ADV NEL: Got it, yip, I’ve got it. 4 to leave out the brackets again. “I used the second 5 Madam Commissioner, we’re just going to make a copy of the 5 applicant and the other applicants to lend out money as a 6 document, I don’t know if you want to – maybe we can have a 6 bridging finance and invest part of the profits in 7 short adjournment? 7 immovable property.” Is that correct? 8 COMMISSIONER: Yes, let’s just stand down 8 DR GRIEVE: Yes. 9 for a few minutes and then once we all the documents in 9 ADV NEL: And in 12.11 you said, “I used10 front of me, we can just see. Thank you very much. 10 part of the profit to buy properties and develop them for11 ADV NEL: Thank you very much. 11 the purpose of re-selling it for a further profit.” Is12 [INQUIRY ADJOURNS INQUIRY RESUMES] 12 that correct?13 [10:34] COMMISSIONER: Back on record, thank you 13 DR GRIEVE: Yes.14 very much – we’re back on record. Dr Grieve, just to 14 ADV NEL: What I understand from that is,15 confirm, youre still bound by your oath of this morning. 15 you only used the profits of these entities to purchase the16 DR GRIEVE: Yes. 16 immovable property. Is that correct?17 COMMISSIONER: Thank you. And are you 17 DR GRIEVE: Initially that would have18 still comfortable talking to us without legal 18 been correct. I would have taken some of my own capital19 representation? 19 out at some stage to help fund the actual development20 DR GRIEVE: Yes. 20 company as well.21 COMMISSIONER: Thank you very much. And 21 ADV NEL: When you say, I would have22 you will bring it to my attention if you are not? 22 taken some of my own capital out, what do you mean by that?23 DR GRIEVE: Ja. 23 DR GRIEVE: We were referring at some24 COMMISSIONER: Thank you very much. 24 stage approximately R5 million. I used some of that to25 Okay, do we have the documentation? 25 help finance my bridging – sorry, my developments as well.Tel: 011 021 6457 Fax: 011 440 9119 RealTime Transcriptions Email:
  11. 11. 1st November 2010 Drs DS Grieves Bridging Solutions (Pty) Ltd (in Liquidation) Inquiry Page 130 Page 132 1 ADV NEL: But that R5 million that you 1 ADV NEL: Under the heading Purpose of 2 told us earlier was your own money from bonds? 2 the loan, it says, “The purpose of this loan is for the 3 DR GRIEVE: Yes. 3 sole purpose and application of investments in the bridging 4 ADV NEL: But it wasn’t money that 4 finance sector of the business, known as Bridging 5 emanated from any of these legal entities that are 5 Solutions. This contract now replaces the one signed on 6 described as applicants in the application? 6 the 23rd of March 2009, with the omission of the raising fee 7 DR GRIEVE: I don’t think so, no. 7 referred to in the previous agreement. This agreement then 8 COMMISSIONER: You don’t think so? 8 also cancels the previous agreement.” So this was the 9 DR GRIEVE: It’s a difficult one, because 9 final binding agreement. Is that incorrect?10 towards the end when we started to hit stress I did move 10 DR GRIEVE: Yes.11 money left and right trying just to survive at that stage. 11 ADV NEL: And correct that the purpose12 So in the last three months it went quite rough and Ja, I 12 was solely for the application of investment, would you13 mean prior to that I think that would be true, but I mean 13 agree with that?14 in the last bit it was very rough. We were waiting for a 14 DR GRIEVE: That’s what it says, yes.15 new corporate funder and that just didn’t arrive. Ja, the 15 ADV NEL: You signed this document, Dr16 pressure was huge. 16 Grieve?17 COMMISSIONER: Sorry, Mr Nel, if I can 17 DR GRIEVE: Yes.18 just interrupt you. So you are saying that was is said 18 ADV NEL: So you agree with the contents19 here in the two paragraphs that you’ve just been referred 19 thereof?20 to, that is not strictly correct? Is that how I understand 20 DR GRIEVE: Yes.21 your evidence, because you say it’s a - 21 ADV NEL: In the next one, Payment of22 DR GRIEVE: It might not have been 22 loan to borrower.23 strictly correct. 23 DR GRIEVE: Which page are we on?24 COMMISSIONER: Are you happy with that, 24 ADV NEL: Still at page 6.25 Mr Nel? 25 DR GRIEVE: I just want to get there Page 131 Page 133 1 ADV NEL: Yes, thank you, Madam 1 again, sorry. Yes. 2 Commissioner. 2 ADV NEL: In the end of Clause 2 it says, 3 COMMISSIONER: Thank you, you may 3 “The loan will made in a single telex transfer from Natwest 4 proceed. 4 Bank in Jersey, Channel Islands to,” and then it sets out 5 ADV NEL: Lets move on to the 5 the account details of Bridging Solutions – 083186789. Do 6 documentation that’s been handed to you. Madam 6 you know what account that is with the Standard Bank? 7 Commissioner, my understanding is that it’s been marked as 7 DR GRIEVE: Well I can recollect this, 8 Exhibit B. 8 because Id made a mistake on this agreement if this is the 9 COMMISSIONER: Thank you, and it has been 9 right one. I cant recollect the account numbers, but I10 paginated with – it’s the last page, its 19 pages, and I 10 can recollect the incident. It’s actually incorporated11 see exhibits are at the end, so that will be – oh I see 11 into account number if I have the right agreement in front12 exactly. You just slotted it in our first bundle right at 12 of me.13 the end with the folder marked “Exhibits.” Thank you very 13 COMMISSIONER: Well, you’ve just said to14 much. 14 Mr Nel that this is the correct agreement.15 ADV NEL: Thank you. Dr Grieve, Im 15 DR GRIEVE: Yes, but there were three16 going to ask you to turn straight to page 6 of that bundle 16 agreements, so I cant remember which one that had the17 given to you. 17 mistake on it.18 DR GRIEVE: Yes. 18 COMMISSIONER: Dr Grieve, forgive me, but19 ADV NEL: You have that in front of you. 19 I need to remind you that you are under oath. If you are20 That’s a document, I would call it an agreement, it’s 20 unsure please tell Mr Nel. Don’t answer a question under21 described as a legal and binding contract entered into 21 oath, because I do not want to bring perjury charges22 between William Lesley Grieve, who’s defined as the lender 22 against you. Okay.23 and Bridging Solutions that’s Dr Grieve Bridging Solutions 23 ADV NEL: Dr Grieve, let me just help you24 (Pty) Ltd, that’s defined as the borrower. 24 before you answer, Im trying to assist you. If you turn25 DR GRIEVE: Yes correct. 25 to page 10 –Tel: 011 021 6457 Fax: 011 440 9119 RealTime Transcriptions Email:
  12. 12. 1st November 2010 Drs DS Grieves Bridging Solutions (Pty) Ltd (in Liquidation) Inquiry Page 134 Page 136 1 DR GRIEVE: Ja. 1 COMMISSIONER: Okay we will assist you. 2 ADV NEL: - that’s the second agreement. 2 Mr Laher will assist you, lets just give him an 3 You will see in the middle of the page it also says, 3 opportunity. 4 Bridging Solutions, account number 083186789. 4 DR GRIEVE: I just remember there was a 5 DR GRIEVE: Ja. 5 mistake with these bank details. I do recollect that. 6 ADV NEL: So it’s the same as the first 6 ADV NEL: That’s fine. 7 one, and then if you turn to page 14, that’s the third 7 COMMISSIONER: Okay. 8 agreement, and then on the middle of the page there, 8 DR GRIEVE: Okay, I have no idea what 9 account number 083186788 – sorry, 778. 9 account number this is. That was a mistake or a typing10 DR GRIEVE: Yes. 10 error of sorts, and I do not know these accounts.11 ADV NEL: Do you see that? 11 ADV NEL: Okay, you’ve been shown the12 DR GRIEVE: Yes. 12 bank accounts with Standard Bank and ABSA and it’s none of13 ADV NEL: So the third one is different 13 those accounts?14 to the first two? 14 DR GRIEVE: No.15 DR GRIEVE: Yes. 15 ADV NEL: Am I right?16 ADV NEL: Okay. So which one is wrong? 16 DR GRIEVE: That’s correct.17 DR GRIEVE: Im under oath so I actually 17 ADV NEL: Where was this money18 need those accounts in front of me to make sure. 18 transferred, Dr Grieve?19 COMMISSIONER: We can assist you. 19 DR GRIEVE: Where or when, sorry?20 DR GRIEVE: But Im fairly confident, and 20 ADV NEL: Where was it transferred? Into21 if they disagree, can they correct me without being in 21 who’s account?22 trouble? 22 DR GRIEVE: Id have to go and have a23 COMMISSIONER: You can. 23 look at the records, Im going from memory. I think it24 DR GRIEVE: Okay. The first two – it’s 24 landed up in Incorporated.25 alright, I think its okay. The first two were incorporated 25 ADV NEL: Okay. This amount of £100 000 Page 135 Page 137 1 alright. Have I got it the wrong way around? 1 at the time equated to a Rand value of 1 33 255 00. Do you 2 ADV NEL: Dr Grieve, as I said to you 2 accept that? 3 earlier, it’s not a witch hunt, so whoever is trying to 3 DR GRIEVE: Yes. 4 assist you is not trying to catch you out. 4 ADV NEL: And according to the records, 5 DR GRIEVE: Ja, I cant remember the 5 you received that on the 8th of April 2009. Do you agree 6 account numbers. 6 with that? 7 COMMISSIONER: Okay, then rather refresh 7 DR GRIEVE: Yes. The date I don’t know, 8 your memory. 8 but I did receive it thereabouts. 9 DR GRIEVE: Ja. Okay. Then in terms of 9 COMMISSIONER: Okay.10 the third one, is also the third contract in order. 10 ADV NEL: The bank records show that on11 ADV NEL: Yes. 11 the 9th of April, the next day, an amount 1 200 000 was12 DR GRIEVE: Okay ja, then I got that one 12 transferred to your personal account. Do you recall that?13 wrong. 13 DR GRIEVE: I made no distinction between14 ADV NEL: Ja. So the third one is the 14 the accounts as weve already said, so yes.15 account number for GS Grieve Incorporated? 15 ADV NEL: Why did you transfer it to your16 DR GRIEVE: Yes. 16 personal account?17 ADV NEL: Youre happy with that? 17 DR GRIEVE: There was no – I cant really18 DR GRIEVE: Yes. 18 answer that, because there is no specific reason, I paid19 ADV NEL: Okay. Now, back to the first 19 people from any account – we’ve already sort of discussed20 one. Whose account is that? 20 that, and I cant really give an answer on it.21 DR GRIEVE: The first one? 21 COMMISSIONER: No but hang on. Lets22 ADV NEL: Yes. 083186789, Standard Bank. 22 just take it slowly. You got the money into an account, we23 DR GRIEVE: I would have to look at the 23 think it’s the Incorporated Account, why don’t you just pay24 bridging account number now, as under oath I cant remember 24 the money from that account? You say you paid people, so25 the account numbers. 25 Im trying to understand your answer.Tel: 011 021 6457 Fax: 011 440 9119 RealTime Transcriptions Email:
  13. 13. 1st November 2010 Drs DS Grieves Bridging Solutions (Pty) Ltd (in Liquidation) Inquiry Page 138 Page 140 1 DR GRIEVE: I would have paid people that 1 ADV NEL: Despite that, we think it went 2 might not necessarily – let me just try and phrase it, that 2 into the account of D Grieve, Incorporated, of the 1,3 3 perhaps not might have been as a term creditors from the – 3 million you transferred 1,2 million to your own account, 4 of the Incorporated, so I would have paid them out of my 4 weve established that. 5 private account. 5 DR GRIEVE: Yes. 6 ADV NEL: But you just said one – half a 6 ADV NEL: You then transferred 900 000 7 minute ago that you paid from any account? 7 from your own account to the account of Bridging Solutions 8 DR GRIEVE: Ja, I know. But we were 8 on the same day, 9 April. Do you recall that? 9 trying to start picking it, but I mean obviously it was 9 DR GRIEVE: Ja.10 still very confused and it was a bit of a mess yes. 10 ADV NEL: Why did you do that?11 ADV NEL: Ja. What was the purpose of 11 DR GRIEVE: Ultimately I believe that’s12 this 1,3 million? According to the agreement it was for 12 where I wanted the bulk of the money.13 investment purposes. What did you intend to do with it? 13 ADV NEL: So why not transfer it directly14 DR GRIEVE: Well, to help the bridging 14 from D Grieve Incorporated to Bridging Solutions?15 business and myself just to survive until we got the 15 DR GRIEVE: My thinking at the time was16 replacement funding. It was the pressure we were having 16 that I was trying to start fixing the – whats the term we17 from Presidium. 17 used now? The mixing of accounts and the like, so I felt18 ADV NEL: And when you say to survive, 18 ultimately we need to try and put this onto the books19 what did you actually earmark this money for? 19 somehow and I thought it might be easier for me20 DR GRIEVE: I cant recall, which was the 20 individually to have a loan account with each entity than21 date? Lets just look at this thing? 21 to try and figure out a loan accounts between the different22 ADV NEL: This was paid to you in April 22 entities, and that was my thinking at the time.23 2010, beginning of – 23 COMMISSIONER: Sorry, but I don’t24 COMMISSIONER: 2009. 24 understand that.25 ADV NEL: Sorry 2009, I apologise. Thank 25 DR GRIEVE: I can try and rephrase it, Page 139 Page 141 1 you, Madam Commissioner. 1 but its just in terms of trying to keep records if you 2 COMMISSIONER: Pleasure. 2 transfer it between all the different companies, you have a 3 ADV NEL: April 2009 – early part. 3 whole load of inter-company loan accounts that you’ve got 4 DR GRIEVE: And the question is, what did 4 to try and chart on your books, and if its through my 5 I use the money for? 5 account then its – each entity then just has a loan account 6 ADV NEL: What did you intend to use the 6 as me instead of an inter-company loan account on the 7 money for? What did you earmark it for? 7 books. 8 DR GRIEVE: I intended to use it for 8 ADV NEL: Dr Grieve, can I suggest to you 9 bridging and to help with the development as well. 9 that a far simpler method would have simply been to10 DR GRIEVE: Okay. And when you say 10 transfer the full 1,3 million to Bridging Solutions,11 bridging, which part of the bridging did you intend to 11 wouldn’t that have been simpler?12 utilise it for? 12 DR GRIEVE: Yes, it would have been13 DR GRIEVE: Which part of the bridging? 13 simpler.14 ADV NEL: Was it meant for more bridging, 14 ADV NEL: That’s what it was meant for,15 was it meant to cover debts you already had? Was it meant 15 wasn’t it? This money was meant for Bridging Solutions.16 to purchase something, what did you need it for? 16 DR GRIEVE: Ja.17 DR GRIEVE: To ultimately try and grow 17 ADV NEL: So youre now telling us that18 the bridging. 18 what you thought was simple, was to take money that was19 ADV NEL: Okay. So it was an investment 19 advanced to Bridging Solutions, you got that money, you20 into the bridging as your brother saw it? 20 transferred it into DS Grieve Incorporated. From DS Grieve21 DR GRIEVE: Ja. 21 Incorporated to yourself, and then from yourself a portion22 ADV NEL: Ja. So what weve now 22 of it to Bridging Solutions, and that seemed to you to be23 established is that, it didn’t matter which account money 23 simpler. Is that what youre saying?24 went into, it was all the same to you? 24 DR GRIEVE: I wouldn’t say it seemed to25 DR GRIEVE: Yes. 25 be simpler, it’s what I did.Tel: 011 021 6457 Fax: 011 440 9119 RealTime Transcriptions Email:
  14. 14. 1st November 2010 Drs DS Grieves Bridging Solutions (Pty) Ltd (in Liquidation) Inquiry Page 142 Page 144 1 ADV NEL: Now, let me ask you again. Why 1 fact that I may have paid Presidium but then suddenly I 2 did you do that? 2 didn’t have to pay them out of the proceeds from the next 3 DR GRIEVE: Ive tried to explain it as 3 collection. 4 well as I can. 4 ADV NEL: You see, Dr Grieve, I 5 ADV NEL: But do you agree with me that 5 specifically asked you just now and gave you an 6 logic tells you, it should have gone directly to Bridging 6 opportunity. I said to you what was this money earmarked 7 Solutions? 7 for? What was the intention? You said to me it was to 8 DR GRIEVE: Yes. 8 grow the business, grow the investment business. But on 9 ADV NEL: So you defied the logic, now 9 the very day you get it whatever Bridging Solutions got10 can you explain why you defied logic? 10 that day you immediately transferred to Presidium.11 DR GRIEVE: I was trying to simplify it. 11 DR GRIEVE: Yes.12 I know you disagree with that, but that was my thinking at 12 ADV NEL: So it was to pay a debt, wasn’t13 the time. 13 it?14 ADV NEL: It’s not whether I disagree, 14 DR GRIEVE: To pay an account with15 Im just trying to get an understanding. 15 Presidium, yes. But once again I’m going to say it again16 DR GRIEVE: That’s what I did at the end 16 as well. I understand what you’re saying. That is true,17 of the day. 17 yes. But we still had a book that was earning at that18 ADV NEL: Okay. Can I ask you why you 18 stage. And that earning I feel was good at that stage.19 didn’t transfer the full amount of 1,3 million to Bridging 19 ADV NEL: But how could it be earmarked20 Solutions? 20 to grow something? You knew -21 DR GRIEVE: Because I would have needed 21 DR GRIEVE: But paying it then you’ve got22 to cover some of my liabilities in my private capacity as 22 this bulk of money that’s earning. So you’re paying them a23 well. 23 part but this thing is still earning, so you just owe them24 ADV NEL: This money wasn’t meant for you 24 less and you’re growing on the side. So I still felt at25 in your private capacity was it? 25 that stage that I was earning, and it was fine and it would Page 143 Page 145 1 DR GRIEVE: No. 1 help grow it. 2 ADV NEL: What then happens to this money 2 ADV NEL: I understand the concept that 3 is the, 900 000 that you transferred to Bridging Solutions 3 if you pay your debtors, sorry your creditors, that 4 you then use and pay Presidium. Is that correct? 4 whatever money you’re going to get coming in from whatever 5 DR GRIEVE: There was a payment to 5 source you don’t have to pay those creditors again and that 6 Presidium Ja. If it was that money directly I cant 6 money would be some sort of profit. 7 necessarily recall, but Ja, I can accept that. 7 DR GRIEVE: Yes. And it would have been 8 ADV NEL: It all took place on the same 8 cheaper. 9 day, on the 9th of April. 9 ADV NEL: Yes, but you’ve loaned this10 DR GRIEVE: Okay. 10 money.11 ADV NEL: During the last inquiry, Mr 11 DR GRIEVE: Okay.12 Laher suggested to you that it appeared to be a case of 12 ADV NEL: To pay Presidium.13 borrowing from Peter to pay Paul. You disagreed with him 13 DR GRIEVE: Okay.14 at the time. 14 ADV NEL: That’s why I’m asking you, what15 [10:54] It certainly seems to be that was what actually 15 was the purpose of getting the R1.3 million from William16 occurred here and that it was an accurate statement. Would 16 Grieve?17 you agree now? 17 DR GRIEVE: To grow the business. And by18 DR GRIEVE: I still don’t agree. And I 18 doing that his rate was lower than what Presidium’s rate19 can try and explain it. I just can’t necessarily recall 19 was, so I would be better off by immediately deploying his20 exact numbers. But in principle I would have had some 20 money by settling a part of Presidium because they were the21 sized debtors book on that specific time and I would have 21 most expensive source of finance.22 had some payment due to Presidium. And I would have made 22 ADV NEL: So then your intention, I23 that payment to Presidium, but I would still have had my 23 understand it’s to grow the business ultimately, but when24 debtors’ book earning the money as well. So I don’t see 24 you obtained the money the intention was to use it to pay25 that as borrowing from Peter to pay Paul, simply for the 25 Presidium.Tel: 011 021 6457 Fax: 011 440 9119 RealTime Transcriptions Email:
  15. 15. 1st November 2010 Drs DS Grieves Bridging Solutions (Pty) Ltd (in Liquidation) Inquiry Page 146 Page 148 1 DR GRIEVE: In that context, yes. 1 DR GRIEVE: To grow the business, ja. 2 ADV NEL: Because you knew of the 2 ADV NEL: Is that what you told him? 3 Presidium indebtedness at that time already. 3 DR GRIEVE: Ja. 4 DR GRIEVE: Ja. 4 ADV NEL: Did you tell him that you were 5 ADV NEL: Dr Grieve, when did Bridging 5 going to use it to settle Bridging Solutions’ indebtedness 6 Solutions start experiencing financial difficulties? 6 to Presidium? 7 DR GRIEVE: We had a hiccup earlier in 7 DR GRIEVE: I don’t believe I did, no. 8 the year when Presidium had made a certain pledge to 8 May I add? 9 increase their funding to me and I lent out on a couple of 9 ADV NEL: Certainly.10 large transactions based on a promise which never came to 10 DR GRIEVE: I’m repeating myself again11 fruition. They promised me an additional R5 million in 11 because it’s the same question, but by doing what I did I12 funding and that did not happen. So we had a bit of a 12 felt at that point in time that it was a cheaper rate of13 hiccup around about April. That’s when William came and 13 finance that I obtained from Bill and that would actually14 helped us out. Then it improved for a short space of time, 14 improve my profit margin on the book as it was.15 and then Presidium started to get uptight and they wanted 15 COMMISSIONER: That was your thinking.16 their money back. And there was a lot of pressure, and I 16 DR GRIEVE: Ja.17 tried to find a replacement funder. And we believed we had 17 COMMISSIONER: You did not specifically18 found such a replacement funder, and the rest you know I 18 inform him of that?19 believe. 19 DR GRIEVE: No.20 ADV NEL: So you say the short answer of 20 COMMISSIONER: Please may I interrupt? I21 course is earlier in 2009. 21 know I’m being extremely fickle, but now the air-con is not22 DR GRIEVE: Ja. 22 on. Can we just put it a bit colder?23 ADV NEL: Can you put a month to that? 23 ADV NEL: Dr Grieve, can you recall when24 DR GRIEVE: That’s quite difficult. No, 24 Bridging Solutions defaulted on the credit facility25 I can’t recall a specific month, no. Around about April we 25 agreement with Presidium? Page 147 Page 149 1 were in pressure, but ja. 1 DR GRIEVE: I can’t remember the first 2 ADV NEL: Did you tell William that what 2 default, no. 3 you needed his money for? 3 ADV NEL: I’m going to ask you to turn to 4 DR GRIEVE: I can’t remember what we 4 page 170. It’s not the document bundle you’ve got in front 5 discussed in detail. There were lots of discussions. I 5 of you. It’s a bundle marked exhibit 2. If you look 6 know at some stage we did discuss that I needed to pay 6 behind you to the left you should see a file with a blue 7 Presidium a large amount of money. I can’t tell you when 7 flag on it with number 2. 8 we discussed that. 8 DR GRIEVE: Page number again? 9 ADV NEL: Okay. You will recall I read 9 ADV NEL: 170. Do you have that page?10 to you from page 48 of that bundle in front of you, and you 10 DR GRIEVE: Ja.11 agreed with the contents of paragraph 17. Do you remember 11 ADV NEL: That’s an email from yourself12 that? 12 to Roanna Verinder.13 DR GRIEVE: Ja. 13 DR GRIEVE: Yes.14 ADV NEL: There William says you 14 ADV NEL: Who I understand is a15 approached him with a proposal to invest in a business. 15 representative of Presidium. Is that correct?16 “It was simple and viable offering safe and secure 16 DR GRIEVE: Ja.17 investment products and returns. I agreed to advance an 17 ADV NEL: Do you know her precise18 initial amount of £100 000.” This was as far as he was 18 position?19 concerned for investment, not to help you settle your debt. 19 DR GRIEVE: No. She’s – no, I don’t.20 You accepted what he said, not so? 20 ADV NEL: It says in the first paragraph,21 DR GRIEVE: Ja. 21 “As we can see by the returns we have had a very slow month22 ADV NEL: So you’re now saying that you 22 on the returns. We have written another three bar with my23 may or may not have told him what you wanted to use his 23 own funds.” That I assume means that you’ve used R3 million24 money for. Let me ask you again. Did you tell William 24 of your own money. Is that right?25 what you were going to use this £100 000 for? 25 DR GRIEVE: I can’t recall exactly what ITel: 011 021 6457 Fax: 011 440 9119 RealTime Transcriptions Email: