The move follows the withdrawal of its most recent financial statements after its auditors withdrew their audit opinion on evidence of fraud.
Delta Property Fund says lead independent director JJ Njeke has reconsidered his decision to resign from its board of directors. He rejoins as Delta faces damage to its reputation after it withdrew its most recent financial results following evidence of fraud.
The fund announced Njeke’s resignation on 3 November when it updated shareholders on a probe into wrongdoing at the company. He quit to reduce his board commitments and to focus on his business interests. It gave no reason for his decision to resume his position on its board. He also chairs the audit, risk, and compliance committee and will remain a member of the nominations, remuneration and investment committees.
Last week, Delta withdrew its 2020 annual financial statements and said it couldn’t release its latest interim results after a forensic investigation by Mazars found evidence of governance failures and wrongdoing. The results were scheduled for release last Friday. While the forensic report was confidential and subject to legal privilege, the fund said that it uncovered unsubstantiated payments, procurement irregularities and other unethical business dealings. Some of the key issues identified included commission payments of R43.9 million resulting from invalid, lapsed or no broker mandates; fraud resulting from unethical dealings amounting to R2.1 million; and non-disclosure of related/connected party transactions to the Board.
Founding CEO Sandile Nomvete and chief financial officer Shaneel Maharaj resigned in August after Delta received the preliminary findings of an initial probe. At the same time, chief operating officer Otis Tshabalala chose not to complete his notice period.
The three have denied any wrongdoing on their part, saying they had always acted in the best interests of the company. Although they hadn’t seen the report, they were told by the company it found no proof of misappropriation of funds by the executives.
We categorically deny the accusations of procurement irregularities and misappropriation of funds or any other illegality or irregularity, as contained in the Sens reports and in pursuant reporting in the media, to the extent that there is any implication that we are complicit in any way therein or were, indeed, aware thereof,” they said in a joint statement last week.
