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Empowerment firm in South Africa sues Deloitte & Touche

Auditing firm Deloitte & Touche said on Monday it would defend a R200-million claim for damages by black empowerment company Sekunjalo Investments Limited, one of the shareholders in Leisurenet, placed in liquidation in October 2000.

Sekunjalo, which owned 18% of Leisurenet, said on Monday it was “abundantly clear” from evidence emanating from an inquiry into Leisurenet's demise, that a substantial portion of the losses sustained by Sekunjalo and other investors might be attributable to Deloitte & Touche — Leisurenet's auditors at the time.

It was therefore claiming R200-million in damages from the auditing firm, it said.

It added that it believed there were hundreds of investors who bought Leisurenet shares, and who have now lost amounts too small to individually institute claims against the auditing firm.

They are therefore delaying instituting action for two weeks to ascertain whether there are other shareholders in the same position, which would justify a class action.

However, Deloitte & Touche said there was no evidence to suggest any wrongdoing on its part.

Said Vassi Naidoo, CEO of Deloitte & Touche: “A Section 417 inquiry has been running for the past two years. Our legal advisers have said that in all that time there has been no evidence to suggest any wrongdoing on the part of Deloitte & Touche, nor anything to suggest that Deloitte & Touche is liable to any party.

“Deloitte & Touche will defend any action which may be instituted against it by Sekunjalo or any other party.”

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