Johannesburg - The National Union of Metal Workers of South Africa (Numsa) has condemned the continued curatorship of the insurance subsidiary of its investment platform, 3Sixty Life, which has been under curatorship for more than 22 months now.
In May, the company said it was hopeful that it would exit the period of curatorship in three to six months, but things are not looking up for the company that fought tooth and nail to remain solvent under difficult circumstances due to prolonged curatorship.
The company, which serves Numsa members, was placed under curatorship in December 2021 by the Prudential Authority (PA) on allegations of an unconvincing recapitalisation plan. It was subsequently prohibited from taking on any new insurance business.
On Monday, and after being mum for a long time, acting CEO of Doves Group Holdings and 3Sixty Life’s parent company, Khandani Msibi, lamented the unending curatorship through a telling tweet, which read: “You might have forgotten that 3Sixty Life is still under curatorship. It has been 22 months of curatorship. We built resilience in that organisation that is profitable and generating cash, irrespective. But if they place a knee on your neck long enough, at some point you will give in.”
Speaking to The Star yesterday, Numsa spokesperson Phakamile HlubiMajola said the continued curatorship of 3Sixty Life was unfair after the company proved that it was able to recapitalise itself and stay afloat.
“As Numsa, we want to see a time when 3Sixty Life is no longer under curatorship. If there was a problem, they should have picked it up by now. The fact that they have not picked up on any problems means that they should lift the curatorship. There is no benefit to workers for this situation to continue.
“There has been reputational harm to the organisation. We would like to see the company get out of curatorship so that it can stand on its own and continue to serve Numsa members.”
Msibi told The Star that the company had fought hard to overcome some of the challenges.
The Group CEO of Numsa Investment Company and then the group CEO of 3Sixty GSG stated that they had capitalisation before curatorship using properties owned by Doves Group, and the PA ignored that capitalisation.
Yashoda Ram was appointed in an ex parte ruling that took 3Sixty Life by surprise. Ram took office, and within three months of the assessment of the company, she issued a report that said that “3Sixty Life ought not to have been placed under curatorship, and the motive of those who decided to place it under curatorship should be questioned”.
According to Msibi, this was followed by an attack on her at the hands of the PA and audit and actuarial firm BDO (Ram’s employer), claiming that Ram misrepresented her qualifications.
The PA went to court on an urgent basis to try to remove her, and the judge dismissed her case, stating that it was an incompetent motion.
Msibi said that the PA was invited to return to court to apply for Ram’s removal, but she did not return to court but abandoned the case.
He further alleged that due to her findings, Ram was put under extreme pressure by BDO, until she resigned in a paid settlement with BDO.
On the final hearing on curatorship, the judge made an unprecedented ruling, removing the curator without a case being made for her removal and dismissing her report.
Msibi said following this, 3Sixty Life applied for leave to appeal against the ruling and the judge turned the appeal request down.
3Sixty Life applied for leave to appeal at the Supreme Court of Appeal. At that time, Msibi stated in one of his tweets that he was prepared to take the case to the Constitutional Court.
The case went quiet for eight months and when approached, Msibi stated that he had entered into an agreement with the PA to manage 3Sixty Life out of curatorship. However, his tweet gave an indication that Msibi was about to give up the long fight to save the business.
Speaking to The Star, Msibi said they had done everything in their power to fight the curatorship and bring 3Sixty Life back to life.
“We have seen UBank and Constantia placed under curatorship and liquidated in three months; we are still here after 22 months, and 3Sixty Life is profitable and generating cash. Why is it still prohibited from selling new business, and why is it still under curatorship?” he asked.
Pressed on whether he was giving up the fight, he said: “This is injustice, and I can’t expect my employees to make more sacrifices; I am unable to.”
Attempts to get comment from the Prudential Authority drew a blank.
The Star