A request from the Financial Services Board (FSB) has placed Rockland Investment Management, an investment firm into which Telkom’s retirement fund (TRF) put R60m, under provisional curatorship.
The TRF invested about R60m with the company in 2009. The investment is now worth an estimated R72m. Although the investment represents only 0,2% of the TRF’s R30bn worth of investment assets, the fact that Rockland Investment Management was on the receiving end of this sort of investment and yet is now in trouble has raised eyebrows.
The FSB says it has provided the retirement fun with a copy of its initial report. The fund is in the process of considering the contents of the report and the potential impact of what has happened.
The fund says it takes all its investments seriously, no matter how big or small.
“We have decided to launch an independent investigation so that we can obtain a clear understanding of why Rockland Investment Management has been placed under provisional curatorship,” says TRF chairman, Lavinia Khangala.
Khangala says the fund “follows a stringent due diligence process when considering any investment, no matter how big or small the investment is in relation to the total assets of the TRF”.
Rockland Investment Management deals mainly in real estate, with much of its money invested in land in the Western Cape near False Bay.
“In this particular case, the due diligence was extended even further, which confirmed that Rockland’s auditor was reputable and that the valuator of the investment asset with Rockland had the correct credentials.”
Khangala says it is worth noting that Rockland Investment Management “has been placed under provisional curatorship, and has not been liquidated”.
“This means there is an investigation into the current value of the assets and the structure in which they are held. It does not mean that the assets no longer exist.”
The TRF is one of six retirement funds with investments in Rockland. The others are the Metal Industries Provident Fund, Engineering Industrial Pension Fund, Sentinel Mining Industry Retirement Fund, Mine Employees’ Pension Fund and the Paper Print Wood and Allied Workers Union National Provident Fund.
Willem Myburgh, principal officer of the TRF, says the fund will only be able to respond to queries on 10 September. — (c) 2012 NewsCentral Media