Chartered accountant Hussun Abdul Khalek Omar, the former director and CEO of Amaanat Investment Holdings (AIH), has been ordered to pay back more than R354m he misappropriated from the group. This follows a recent arbitration award issued by retired judge Ashley Binns-Ward in a civil action instituted by AIH against Omar. The award was made public after being filed in a related civil matter pending before the Durban high court.
According to the 103-page ruling, AIH proved its claim against Omar personally, establishing that he used the funds without authorisation and committed theft in the civil law sense. The judge accepted evidence that Omar had confessed to withdrawing about R40m from AIH without board and shareholder authority and offered to reimburse the money. However, during arbitration proceedings, Omar claimed the money was paid for services provided by his accounting firm, Kreston KwaZulu-Natal, on invoice.
The judge found the invoices to be questionable, characterised by features suggestive of fabrication, and Omar was obliged to explain them. However, he did not give evidence during the arbitration proceedings, and the evidence of his son, MH Omar, did not pass muster. The judge concluded that Omar had not provided sufficient counter-evidence to AIH's expert witnesses. As a result, the judge ruled that Omar was liable to repay the misappropriated funds to AIH.
In a separate case, Omar appeared in the Durban magistrate's court in July, facing 22 counts of fraud and 12 counts of money laundering. The charges allege that Omar plundered more than R29m from AIH while serving as director and managing partner of Kreston KZN. He allegedly used the funds to purchase luxury properties in Cape Town and Houghton, a Porsche, and precious metals. The victims were approximately 6,500 AIH shareholders, many of whom were vulnerable Muslim pensioners and single mothers.
Omar's application for bail was granted in the amount of R200,000, and he denied the allegations. He is set to appear in court again in October. In the civil matter, AIH sued Omar for R650m, and the judge ruled that Omar had shifted his defence but did not provide sufficient explanation. The judge also ruled that evidence from attorney MS Omar, Omar's first cousin, regarding his confession was admissible.
Expert witnesses for both sides agreed that the total payments from AIH to Kreston between 2013 and 2021 were R646m. A key expert witness for AIH deemed the minimum misappropriation to be R354m. The judge concluded that Omar's lawyers had submitted that AIH's case had to fail because it had not proved the quantum of its loss. However, the judge ruled that Omar must take responsibility for the fact that the invoices cannot be accepted at face value.
The arbitration award requires Omar to repay R354.84m to AIH and to pay its costs on a punitive scale, including the costs of its experts. The judge dismissed claims against other entities, including Kreston, but made awards against Rapid River and FHO Trust, holding them liable, jointly with Omar. Omar has until October to lodge an intention to appeal the award, which will be heard by three retired judges.
Key points
- Omar must repay R354.84m to AIH.
- Omar faces 22 counts of fraud and 12 counts of money laundering.
- The arbitration award was made by retired judge Ashley Binns-Ward.
