Forfeiture of properties in terms of Poca

The Prosecutor General v Amushelelo (2024) NAHCMD 436 (2 August 2024)

Facts

The applicant (the Prosecutor General) moved an application for the forfeiture of property order against the first respondent, Mr Amushelelo, and legal entities he had an interest in.

The applicant claimed that the properties in question, constitute an instrumentality of an offence, or are proceeds of unlawful activity as envisaged in section 61(1) of the Prevention of Organized Crime Act 29 of 2004 (POCA). In essence, the applicant claimed that the properties in question are the progeny, so to speak, of the crimes of fraud, money, laundering, racketeering and tax evasion. As such, the applicant claimed that this is indeed a proper case that warrants the granting of a forfeiture of property order in terms of POCA.

In this regard, the applicant claimed that the first responder made false representation to members of the public, who were duped into parting with their hard-earned money to the respondents on the false premise that they would receive favorable interest on their investments in the forex market. In this regard, members of the public were caused, via the instrumentality of Project One Million, to invest their money with Global Growth and/or Amushe International, and the first responder would reinvest the money on the forex market.

The applicant further contended that the first responder used his social media accounts to make members of the public believe that his lavish lifestyle was funded by investments on the forex market. In this regard, as a result of misrepresentations he made, he and his entities received millions of Namibia Dollars from the Project One Million investments. The first respondent and his other entities did not reinvest the money received from the public on the forex markets. The interest on the investments paid to members of the public pursuant to Project One Million consisted of the money paid by other members of the public as investments, meaning that the later investors’ money was used to pay the earlier investors.

The applicant further claimed that the first responder used the money paid for Project One Million to purchase the properties sought to be forfeited, and these were for his personal use and were employed towards funding his lavish lifestyle, to the serious prejudice of the members of the public. The members of the public were made to believe that the first responder’s lavish lifestyle was funded by the money received from funds derived from the forex trading. This, the applicant submitted, amounts to fraud, thus rendering the properties in question, being proceeds of fraud and thus falling within the ambit of proceeds of unlawful activities as defined in POCA, liable for forfeiture.

The applicant further made a case for the allegations that the respondents were guilty of money-laundering. In this regard, the applicant contended that the first responder made inter-account transfers of the money from Project One Million. In this regard, I have used misleading references to create the perception that the money was invested on forex markets, when that was not the case. He instead used the money to purchase vehicles, and reinvested some of it into his other businesses, and further used some of it to fund a lavish lifestyle. This created the impression that his opulent lifestyle was funded by his activities on the forex markets. This, it was submitted, resulted in the said transactions, on a balance of probabilities, having the effect of concealing the true origin, nature, source, location, disposition and movement of the properties, and thus fitting the definition of money-laundering.

The applicant further alleged that the respondents’ activities also amounted to the offense of racketeering in terms of section 2(2) of POCA.

The applicant contended that the respondents do not, in their papers, dispute the allegation that they were involved in a pattern of racketeering activities due to the planned, ongoing and repeated involvement of the applicant and the various other entities linked to him, in the offenses of fraud and money-laundering. They also do not dispute the allegation that the properties in question are the proceeds of offenses relating to a pattern of racketeering activities.

Lastly, the applicant contended that over and above the offenses mentioned above, the respondents were guilty of violating the provisions of the Income Tax Act 24 of 1981. This is because the respondents’ bank accounts reflect that they received income over the years, which they did not declare with the Receiver of Revenue. In this regard, it was alleged that the respondents are liable to pay income tax in the total amount of N$15,155,715.10.

The respondents denied liability, and claimed that the applicant had not properly understood and applied the Act, and that there was no evidence that the respondents had committed the alleged offenses on a balance of probabilities. The respondents claimed that the order for preservation of property was obtained in violation of an order of court by Rakow J. They, therefore, contended that the application for forfeiture must be dismissed on that basis, without the need to consider the other issues.

The respondents, in the alternative, contended that the applicant failed to show that she is entitled to the relief sought. This was primarily for the reason that the first respondent, Mr Amushelelo, was running a legitimate business under the phrase ‘Project One Million’ under which he received money from members of the public as loans and in order to trade on the Amushe International Holding Group (Pty) Ltd.

In this regard, he claimed that the money was deposited into an account of Amushe International Holding Group Ltd held at First National Bank. After two months, he further claimed, the members of the public who had given the loans to him would receive their money, with 50% interest on the principal amount. It is his further assertion that Global Growth Namibia entered into agreements acknowledging indebtedness to the members of the public who would have availed their funds. In this regard, payment terms of the debt are stipulated. The money advanced by the members of the public would be used to trade on the forex trading platform (online) when the market is determined to be good, with sound profits available.

Issues

Whether or not this was a proper case in which this court should grant the forfeiture of property order in terms of POCA?

Determination

Held that in applications for forfeiture of property order, the applicant must satisfy the court on a balance of probabilities that the property sought to be forfeited is the instrumentality of an offense, proceeds of crime or whose origin is unexplained.

Held that the applicant must show that the party whose property is sought to be forfeited has on a balance of probabilities committed either a statutory offence, or a common law crime mentioned in Schedule 1 of POCA.

Held further that the applicant had by admissible evidence shown on a balance of probabilities that the respondents had committed the offenses of fraud, tax evasion, and money-laundering.

Held that the respondents had not met the requirements of s 52(3) of POCA in relation to forfeiture of property application in that they did not set up facts upon which they sought to defeat the said application. This is entitled the court to dismiss the application without further ado.

Held that the respondents had not meaningfully engaged the allegations by the applicant regarding the forfeiture of property order, but had made generalized denials, devoid of the requisite facts. As such, the Plascon-Evans rule should apply, and the application be determined in the applicant’s favor.

Held further that it is not necessary that the applicant should prove that the respondents had committed all the offenses alleged on the balance of probabilities. The necessary proof that one offense was committed suffices, as long as it falls within the offenses listed in Schedule 1. Held that there is no evidence that the applicant deliberately violated the order issued by Rakow J, and there is thus no evidence that the applicant is guilty of approaching the court with dirty hands, and that the application deserves to be dismissed therefore.

Held that fraud is a deliberate act of deception intended for personal gain, or to cause actual or potential loss to another party. It involves intentionally misleading another party through false representations or pretences to secure an advantage.

Held further that money-laundering is a process of disguising the origins of illegally-obtained money or property, so that it appears to come or have been derived from legitimate sources. This is typically done for the purpose of concealing the criminal activities that were employed in generating the funds, and to avoid detection by the authorities. The process normally involves three distinct stages, namely, placement, layering and integration.

Held that proof on a balance of probabilities as employed in s 61 of POCA means that the party bearing the burden of proof must show that their claim is more likely to be true than not. This means the judge must be satisfied that there is a greater than 50% chance that the claim is correct. In other words, the court must be satisfied on a balance of probabilities that the applicant has proven that the provisions of s 61(1) have been met.

Application for forfeiture of property order granted as prayed.

Court order

The properties which were subject to a preservation of property order granted by the Court were forfeited to the State in terms of section 59, as read with 61 of the Prevention of Organized Crime Act 29 of 2004.

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