History of LeisureNet, Peter Gardener and Rodney Mitchell case
LeisureNet was the principal operating division of the now-defunct Health and Racquet Club. The bad story started when it was liquidated in November 2000 and it had ZAR 320 million as liabilities – plus contingent liabilities leading into even more millions.
It was suspected that the former CEOs of LeisureNet Peter Gardener and Rodney Mitchell hiding behind offshore companies were enriching themselves at the expenses of investors of LeisureNet. There was a Channel Islands based offshore company Dalmore Ltd. that was paid at least ZAR 40 million by LeisureNet for gyms in Germany, without LeisureNet shareholders being aware of Gardener's and Mitchell's interests.
Legal proceedings started and the CEOs were arrested in March 2002. Investigators together with South Africa Revenue Services considered that the LeisureNet group was defrauded of about US$ 380,000.
There emerged the information that Peter Gardener and Rod Mitchell each held a secret 20 percent interest in a German health club operator as well as there was a secret agreement between Mitchell and Gardener that a commission of DEM 90,000 obtained from each new lease signed on a health club in Germany would be shared among Mitchell, Gardener and 2 other executives of the company.
In 2005, Gardener was convicted of VAT fraud and insider trading as related to LeisureNet and sentenced to imprisonment. Jail term was conditionally suspended. Gardener agreed to pay ZAR 2,9 million after reaching a plea bargain agreement with the Directorate of Special Operations, unit of the National Prosecuting Authority of South Africa called the Scorpions. This is a multidisciplinary agency that deals with investigating and prosecuting corruption and organized crime.
Now judge Dirk Uijs continues pleading the case in Cape High Court regarding the four accused - former LeisureNet joint chief executives Peter Gardener and Rodney Mitchell, Mitchell's wife Suzanne, and their business associate Hans Moser Nentered. Gardener and Mitchell face charges of fraud, money-laundering, income tax evasion and contraventions of the Companies Act, involving some ZAR 16 million. Moser and Mrs Mitchell face money laundering charges only. They are defended by Advocate Francois van Zyl.
It was suspected that the former CEOs of LeisureNet Peter Gardener and Rodney Mitchell hiding behind offshore companies were enriching themselves at the expenses of investors of LeisureNet. There was a Channel Islands based offshore company Dalmore Ltd. that was paid at least ZAR 40 million by LeisureNet for gyms in Germany, without LeisureNet shareholders being aware of Gardener's and Mitchell's interests.
Legal proceedings started and the CEOs were arrested in March 2002. Investigators together with South Africa Revenue Services considered that the LeisureNet group was defrauded of about US$ 380,000.
There emerged the information that Peter Gardener and Rod Mitchell each held a secret 20 percent interest in a German health club operator as well as there was a secret agreement between Mitchell and Gardener that a commission of DEM 90,000 obtained from each new lease signed on a health club in Germany would be shared among Mitchell, Gardener and 2 other executives of the company.
In 2005, Gardener was convicted of VAT fraud and insider trading as related to LeisureNet and sentenced to imprisonment. Jail term was conditionally suspended. Gardener agreed to pay ZAR 2,9 million after reaching a plea bargain agreement with the Directorate of Special Operations, unit of the National Prosecuting Authority of South Africa called the Scorpions. This is a multidisciplinary agency that deals with investigating and prosecuting corruption and organized crime.
Now judge Dirk Uijs continues pleading the case in Cape High Court regarding the four accused - former LeisureNet joint chief executives Peter Gardener and Rodney Mitchell, Mitchell's wife Suzanne, and their business associate Hans Moser Nentered. Gardener and Mitchell face charges of fraud, money-laundering, income tax evasion and contraventions of the Companies Act, involving some ZAR 16 million. Moser and Mrs Mitchell face money laundering charges only. They are defended by Advocate Francois van Zyl.
posted by Brian Obvi, Offshore Analyst | 6:30 PM
0 Comments:
Post a Comment
<< Home