InvestingMining

Fallout continues at Heaven-Sent after manager found “grossly negligent” of gold sales

A SENIOR manager at Heaven-Sent Gold SA, the parent company of Village Main Reef (VMR), has been found to be “grossly negligent” – a development that comes just over a week after the firm confirmed it had replaced its CEO.

On January 4, Heaven-Sent CEO, Jeff Dong, was placed on leave. Another company executive, Xining Xing, was appointed acting CEO, according to a notice issued by Michael Zhang, a Heaven-Sent Gold South Africa director, who lives in China.

Dong was identified in an affidavit submitted to the Labour Court for allegedly defrauding the company. VMR operates the Kopanang and Tau Lekoa gold mines which employ more than 6,000 people. The mines were last year subject to restructuring notices following accumulated losses, dating from 2018.

The Commission for Conciliation, Mediation and Arbitration (CCMA) found Heaven-Sent group manager for financial reporting, Stephanus de Koker, “grossly negligent” in respect of his handling of the sale of gold doré bars. The CCMA hearing, which contained charges levelled by VMR, was held in Klerksdorp on 10, 11, 14 and 17 December.

On 4 January, Foster Maluleke, a Klerksdorp CCMA commissioner, in a 22-page ruling recommended that the dismissal of De Koker was the “appropriate sanction”. Miningmx has a copy of the ruling.

Maluleke exonerated Heaven-Sent South Africa finance director, Phillip Spencer, of the two charges of gross negligence that the company laid against him including the sale doré bars charge levelled against De Koker. Both plead not guilty to all charges at the hearing.

According to Maluleke’s ruling, VMR sold doré bars to precious metals recovery company Rappa Resources, based in Germiston, Gauteng, from June to September last year with no sale agreement between the two parties.

VMR stated in the charges that De Koker’s conduct could cause severe financial harm, exposed VMR to legal contraventions, and the misconduct rendered the “employment relationship wholly intolerable”, Maluleke said.

De Koker confirmed his employer’s statement that trust between them had “irretrievably broken down”, he wrote. The parties accepted that the sale of the doré bars was irregular, Maluleke said.

The sale of doré bars to Rappa breached the agreement between VMR and Rand Refinery. This contravention exposed the company to a lawsuit, the CCMA said.

Former VMR CEO, Owen O’Brien testified at the hearing in December that there was no insurance to cover the delivery of doré bars’ delivery to Rappa. “This exposed the company to a serious risk,” Maluleke wrote.

Gerhard Botha, the Johannesburg attorney representing De Koker and Spencer, declined to respond to questions that Miningmx sent to him by email. Miningmx sent questions to the lawyer representing Heaven-Sent, Nick Veltman from Beech Veltman Inc. He undertook to respond by Tuesday afternoon, but he did not.

Heaven-Sent suspended Spencer and De Koker in September last year.

Their suspension came after they blew the whistle on R257m in alleged “irregular” and questionable spending by VMR. They also claimed that they had uncovered R143.2m in “accounting irregularities”.

The post Fallout continues at Heaven-Sent after manager found “grossly negligent” of gold sales appeared first on Miningmx.

Miningmx

Visited 2 times

Leave a Reply

Your email address will not be published. Required fields are marked *