MBABANE – Inhlonhla, the company currently owned and managed by Mbuso Simelane, was not a new entrant in the market.
Rather, it was effectively the rebranded entity of Interneuron Swaziland, a firm whose South African parent company collapsed amid allegations of catastrophic financial mismanagement.
The Times SUNDAY can reveal that Simelane and his associates strategically rebranded Interneuron as Inhlonhla on May 8, 2013.
It has been established that this move was intended to establish a secure position for the local operation just as the parent company was facing liquidation calls in South Africa.
This effectively distanced the Eswatini entity from the impending doom of its headquarters.
During the years following this rebranding, the company underwent shifts in its leadership structure. By 2014, Mbuso Simelane and Willem Jonker were listed as co-directors, steering the ship through the turbulent waters of its formative years. However, the foundations of Inhlonhla (Pty) Ltd were built upon the shaky ground of Interneuron Swaziland’s legacy.
When it first transitioned, the company was saddled with a massive debt of E100 million, yet paradoxically held a significant shareholding in the Swaziland Industrial Development Company (SIDC), now known as the Industrial Development Company of Eswatini (IDCE), valued at E136 million. This duality of heavy debt and high-value assets characterised the entity’s infancy.
It remains unclear where Interneuron sourced the funds for acquisition of shares, given it was established as an asset management company receiving money from the Eswatini National Provident Fund (ENPF) for investment purposes.
It is crucial to examine the background of the man who was at the helm during this critical transition. It must be said that Mbuso Simelane was not an outsider to the industry, as he worked for SIDC (now IDCE) as the chief financial officer from January 2003 to September 2011.
In 2014, Simelane was listed with Jonker and Nicholas Balcomb as directors of Interneuron Swaziland Investment Trust (Proprietary) Limited. It could not be ascertained how this trust operated alongside Inhlonhla (Pty) Ltd, which had already taken over the affairs of Interneuron Swaziland in 2013.
This publication can mention that the nature of Interneuron’s origins is laid bare in the damning findings of the Financial Services Board (FSB) Appeal Board in South Africa. On November 18, 2016, the Board dismissed an appeal brought by Willem Daniel Jonker, Simelane’s then business partner in Eswatini, against his debarment by the Registrar of Financial Services Providers.
Jonker was debarred on April 26, 2016, because he no longer met the ‘Fit and Proper’ requirements contemplated in terms of the Financial Advisory and Intermediary Services Act (FAIS Act). This ruling effectively stripped him of his legitimacy within the financial sector, yet his influence and the company he helped build in Eswatini continued to thrive.
According to the Board, with Jonker at the helm, Interneuron contravened various provisions of the General Code of Conduct and the Financial Institutions (Protection of Funds) Act. The debarment followed a 2012 inspection which revealed that one client had sustained substantial losses after their management was entrusted to a representative of Interneuron.
The inspection uncovered that the client suffered significant trading losses and substantial amounts were transferred to another client over the years. Furthermore, the investigation found that the representative had falsified investment reports and invested funds in unsecured loans outside the parameters of the client’s mandate, a clear breach of trust and fiduciary duty.
In her judgement, Appeal Board chair Justice Yvonne Mokgoro agreed with the Registrar’s reasoning, pronouncing extensively on the need for gatekeepers to oversee financial service providers strictly. Justice Mokgoro stated: “As key individual at Interneuron by virtue of the legal duty he has, (the key individual) must account for (the representative’s) dishonest actions. That is a requirement of the FAIS Act and the Code.”
While Jonker’s Interneuron was receiving public funds in Eswatini, its mother company across the border had already collapsed in 2012, it must be said.
The High Court of South Africa (Western Cape High Court), in Case No. 17926/2012, detailed the extent of this ruin. The curator reported: “I closed down the offices of Interneuron and transferred all their files to my office and disposed of the furniture and equipment. The process was finalised during July 2013. At the end of December 2012, I retrenched the remaining two staff members of Interneuron.”
It was amid this turmoil and the complete liquidation of the South African parent that Interneuron Swaziland executed its name change to Inhlonhla (Pty) Ltd. This timing, according to concerned highly placed individuals, ‘suggested’ a strategic effort to insulate the local subsidiary from the reputational and financial fallout of the South African collapse.
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