MBABANE, Eswatini – The Eswatini government is now moving to seize the global assets of Dave Van Niekerk, both legitimate and otherwise, in an effort to recover the E334 million lost in the Ecsponent scandal.
The Ministry of Finance has shifted to a more aggressive recovery strategy, invoking the country’s Anti-Money Laundering Act and South Africa’s Prevention of Organised Crime Act (POCA).
The move was outlined in a meeting where the Investor Relations Committee (IRC) met with Finance Minister Neal Rijkenberg, the Ecsponent Recovery Task Team, and the acting principal secretary. For the first time since its formation, the IRC met with the ministry, although the Financial Services Regulatory Authority (FSRA) was notably absent. The FSRA has previously faced allegations in court of accepting bribes from Van Niekerk.
“The ministry stated that the aggressive approach will allow the government to identify and attach assets belonging to Ecsponent directors – whether legitimate or illegitimate – and sell them to pay investors,” IRC Chair Norman Dlamini said.
He added that the government has engaged a senior counsel in South Africa with extensive experience in asset recovery. The counsel has assembled a team, including a forensic investigator, to trace the directors’ assets globally.
“The task force is also responsible for identifying the assets of directors in Eswatini who received high dividends despite Ecsponent Eswatini underperforming,” Dlamini said.
The ministry also emphasized that taxpayer funds will not be used to pay investors until recovery options are fully exhausted. Only after the recovery process is complete could the government consider providing a top-up, officials told the stakeholders.
The senior counsel is expected to deliver an initial report in two to three weeks, which will be presented to Parliament as part of the ministry’s feedback to the Parliamentary Select Committee. However, the ministry said it cannot provide a full timeline for the recovery process, noting that some steps may take considerable time.
Finance Minister Rijkenberg told the meeting that the purpose was to update stakeholders on the Ecsponent Recovery Strategy following recommendations by the Parliamentary Select Committee. He reminded attendees that the separation of powers limits Parliament’s ability to order direct payments to investors.
“The separation of powers between Parliament, Cabinet, and the Judiciary does not allow one arm to instruct another to take action; hence, Parliament did not instruct Cabinet to pay the investors. Parliament only made a recommendation,” he said.
The ministry also revealed that negotiations with Ecsponent directors to voluntarily contribute funds to a collective recovery pot, which the government would then supplement, had stalled.
Dlamini confirmed the same update to investors, cautioning that the timeline remains uncertain. After assets are identified, they must be evaluated before being sold, which could delay payouts.
Rijkenberg said the Central Bank of Eswatini-led team investigating the scandal discovered evidence of money laundering in Ecsponent’s dealings. He said this strengthens the case for asset seizure under anti-money laundering laws.
“Having taxpayers pay for this has never been an option,” he said. “Tracing and attaching assets under the law gives us a better chance of recovering investors’ money than relying on voluntary contributions.”
He said senior counsels in Cape Town, together with a forensic team, are tracing the cash to determine which assets were purchased with investor funds. He added that this route could be faster than pursuing lengthy civil litigation.
He also acknowledged that rushing the process could reduce the amount recovered. “The more we take our time and follow through thoroughly, the more we can collect for the investors,” Rijkenberg said.
Background of the Ecsponent scandal
Investors who bought into Ecsponent in March 2020 contributed E340 million, while those who invested under ESW Investment Group (ESWIG) from March 2020 to November 2021 contributed E70 million, bringing total investments to E410 million.
By December 2021, ESWIG reportedly failed to pay dividends, prompting investors to question the company’s stability. In June 2022, an annual general meeting at Esibayeni Lodge revealed that funds invested under Ecsponent before March 2022 were “somehow lost,” while post-March 2022 investments were reportedly still safe.
The crisis led to the formation of the Investor Recovery Committee (IRC) to work with ESWIG management to recover the missing funds, and the issue was later taken to Parliament.
The new global asset recovery effort is separate from previous litigation in which Van Niekerk and his associate Edwin Soonius faced security-for-costs applications related to alleged asset erosion at Status Capital Building Society. In that case, applicants argued that the pair, described in court as fugitives from the law, should provide security for costs due to the risk of foreign asset shielding.
Initially, Rijkenberg had suspended all litigation involving Ecsponent, but the discovery of potential money laundering prompted a more aggressive recovery strategy focused on tracing and attaching assets globally.
