B-BBEE COMMISSION // FRS WAREHOUSING CC T/A EPS COURIER SERVICES


Complainant(s)		Respondent(s)
B-BBEE Commission		FRS Warehousing CC t/a EPS Courier Services
Summary / nature of the complain
B-BBEE Commission initiated investigation pursuant to information received on possible misrepresentation of B-BBEE status by FRS Warehousing CC t/a EPS Courier Services – trading with B-BBEE certificate that indicates 100% black ownership when the entity is owned 100% by a white male South African - Findings – misrepresentation of B-BBEE status and use of false credentials for ownership to obtain higher B-BBEE level – Recommendations – referral to CIPC and SANAS, and pursue section 13J (4) of the B-BBEE Act for appropriate relief.
Brief description of the Complaint
The B-BBEE Commission initiated an investigation for possible misrepresentation of B-BBEE status based on allegations and supporting information submitted by Mr Keith Levenstein of EconoBEE that FRS Warehousing CC t/a EPS Courier Services (“EPS Courier Services”) engaged in conduct that is contrary to the objectives of the B-BBEE Act by knowingly presenting FRS Warehousing CC t/a EPS Courier Services misleadingly as a 100% black-owned entity, and further that the entity fraudulently obtained a B-BBEE level 7 (seven) based on incorrect ownership credentials, when the entity is 100% owned by Mr Evert Philip Serfontein, a white South African male. According to the B-BBEE Act, “black people” is a generic term which means Africans, Coloureds and Indians (a) who are citizens of the Republic of South Africa by birth or descent; or (b) who became citizens of the Republic of South Africa by naturalisation (i) before 27 April 1994; or (ii) on or after 27 April 1994 and who would have been entitled to acquire citizenship by naturalisation prior to that date. Based on the response provided to the B-BBEE Commission by Lee and McAdam Attorneys, legal representatives of EPS Courier Services, Mr. Evert Philip Serfontein was apparently informed by his mother that his real father is actually a coloured man and that his white father is not really his father. Following the meeting, Lee and McAdam Attorneys stated and confirmed that they would provide the B-BBEE Commission with information and proof to substantiate their averment that Mr. Evert Philip Serfontein is actually a black man and is entitled to benefits under the B-BBEE Act. However, EPS Courier Services failed to submit such proof even with sufficient time given and several reminders by the B-BBEE Commission. Therefore, the averment by Lee and McAdam Attorneys that Mr. Evert Philip Serfontein is a black man remains unsubstantiated with all documents indicating clearly that Mr Evert Philip Serfontein is a white South African male who does not qualify for a benefit under the B-BBEE Act. Lee McAdam Attorneys had further indicated that Mr. Evert Philip Serfontein is in the process of seeking a declaratory order to confirm him as a black person and that they will cite the B-BBEE Commission in that process, however, that has to date not occurred.
Summary findings of the B-BBEE Commission
EPS Courier Services and Mr. Evert Philip Serfontein claimed 100% black ownership in EPS Courier Services for the purposes of the B-BBEE certificate No. GEN/31/10/2016/001 issued by D. Kalmin and Company on 31 October 2016 for B-BBEE compliance, when such is not the case as Mr Evert Philip Serfontein is a white male South African, who according to the records of the Companies and Intellectual Property Commission (CIPC) was at the time of the issuance of the said B-BBEE certificate the sole member of EPS Courier Services; EPS Courier Services and Mr. Evert Philip Serfontein traded with a B-BBEE certificate No. GEN/31/10/2016/001 issued by D. Kalmin and Company on 31 October 2016, which was based on false information, and the said B-BBEE certificate is invalid for the purposes of compliance with the B-BBEE Act; EPS Courier Services and Mr. Evert Philip Serfontein misrepresented the B-BBEE status of the entity through the B-BBEE certificate No. GEN/31/10/2016/001 issued by D. Kalmin and Company on 31 October 2016 and may have unduly benefitted financially using black ownership credentials that are non-existent; EPS Courier Services and Mr. Evert Philip Serfontein misrepresented the B-BBEE status of EPS Courier Services in order to improve the entity’s B-BBEE status; EPS Courier Services and Mr. Evert Philip Serfontein knowingly operated on the false B-BBEE status for the 2016/2017 period, claiming that the entity has 100% black ownership notwithstanding the fact that Mr. Evert Philip Serfontein is a white male and does not fall within the definition of black people under the B-BBEE Act; EPS Courier Services and Mr. Evert Philip Serfontein knowingly provided false information to the B-BBEE Commission when they claimed that Mr. Evert Philip Serfontein is black but have to date failed to provide proof thereof since the 30th of May 2017 when this claim was made to the B-BBEE Commission, thus confirming that Mr. Evert Philip Serfontein is a white male who is not entitled to benefit in terms of the B-BBEE Act; EPS Courier Services and Mr. Evert Philip Serfontein provided false information to D. Kalmin and Company in order to secure an improved B-BBEE status and benefits associated with compliance of the B-BBEE Act; EPS Courier Services and Mr. Evert Philip Serfontein acted dishonestly by continuing to use the B-BBEE certificate No. GEN/31/10/2016/001 issued by D. Kalmin and Company on 31 October 2016 even after it had been cancelled by D. Kalmin and Company, who communicated the cancellation in writing; EPS Courier Services and Mr. Evert Philip Serfontein hindered and obstructed the B-BBBEE Commission when it was exercising its powers and performing its duties in that they failed and neglected to cooperate with the B-BBEE Commission when it was assessing and investigating this matter; Mr. Evert Philip Serfontein acted dishonestly, unethically and improperly with total disregard of his fiduciary duties as a member of in EPS Courier Services in a manner that may amount to a contravention of the Close Corporations Act, and points to him possibly being unfit to hold any membership or directorship in any entity; and The conduct of EPS Courier Services and Mr. Evert Philip Serfontein outlined above is contrary to the objectives of the B-BBEE Act, and may amount to an offence in terms of section 13O (1) (a)-(b) of the B-BBEE Act for misrepresentation of B-BBEE status and misrepresenting or providing false information to the verification professional, as well as section 13N (3) (a) and (c) of the B-BBEE Act for hindering and obstructing the B-BBEE Commission and knowingly providing false information.
Recommendations of the B-BBEE Commission
refer the matter to CIPC for an investigation to be conducted into the affairs of EPS Courier Services and the conduct of Mr. Evert Philip Serfontein, and the extent to which their conduct could be applicable to any other entity in which Mr. Evert Philip Serfontein is a member, with a view of also obtaining a declaration of him as delinquent or unfit to hold directorship or membership in any entity without prejudice to other remedies under the law; in terms of section 13J (4) of the B-BBEE Act, consider instituting proceedings in a court to restrain any breach of the B-BBEE Act or to obtain appropriate remedial relief arising from the conduct, including an order to declare invalid any contract entered into, between EPS Courier Services and any other parties on the basis of the B-BBEE information so misrepresented; and refer D. Kalmin and Company as an entity to the regulatory body for auditors to investigate the practice and impose appropriate remedial action, noting that D. Kalmin and Company is not accredited with South African National Accreditation Systems (SANAS) and that it is no longer permitted to conduct any verification effective from 31 December 2016.
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