Durban’s most flamboyant couple Shauwn and S’bu Mpisane, who have financed their high-flying lifestyle primarily through not paying taxes on their earnings from the lucrative government tenders, are now desperately trying to hide assets as the taxman hovers with claims totalling nearly a quarter of a billion rand.
Noseweek has written extensively (noses103; 109; 125; 150; 195; 203 & 204) about the Teflon Two, most recently in November (nose205).
According to court papers filed by SARS at the High Court, Durban, in November, the couple and their companies owe “in excess of R204 million”, most of it being part of a settlement agreement reached in 2014 with the tax authority.
SARS obtained the order in chambers in the North Gauteng High Court from Deputy Judge President Audrey Ledwaba and, in Durban, from Judge Rashid Vahed.
Of the total claimed, Shauwn owes R57m, but SARS is going after the two jointly, as they are married in community of property.
The Mpisanes are disputing the taxes owed, but SARS is sticking by its “pay-now-argue-later” principle.
It is unclear who exactly is playing whom and whether this is all part of a ruse by the Mpisanes to escape their monumental tax burden by claiming – in the media in KwaZulu-Natal – that they are unable to pay their taxes because government departments have not paid them for various construction contracts.
SARS seized the assets of the couple, and those belonging to their various companies under the Tax Administration Act. If the seizure is successfully challenged, SARS will bring a sequestration application in February, Noseweek has been informed.
Vehicles seized by SARS include an Aston Martin Rapide, a Dodge Ram and several BMWs. Although not on the seizure list filed in court, several more luxury cars are also reported to have been impounded, including a Ferrari 612 Scaglietti and a McLaren MP4-12C.
Properties include their La Lucia mansion in Durban North.
The couple’s assets are being held by Pieter Strydom of Strydom & Bredenkamp Inc in Pretoria and Tshifhiwa Mudzusi of Honey Attorneys, Bloemfontein.
It appears the Mpisanes have been preparing for the arrival of the men from SARS. Before the seizure the couple had already began transferring property and vehicles into other entities to avoid having them seized, including into a family trust called Sbusha Trust, which was set up only at the beginning of 2016.
One of these assets is a 54-hectare farm in uMshwathi Municipality in the KwaZulu-Natal Midlands, bought by the Mpisanes in 2014 for R14m. This has been developed into a multi-million-rand soccer training academy, possibly for their own First Division club, the Royal Eagles. The property was transferred from the Mpisanes to the trust in March 2016 and valued at R15m. With all the improvements they have made, it is said now to be worth as much as R30m.
When moveable items were seized from the Mpisanes’ properties it was reported that several known assets were missing.
Simultaneously both Zikhulise Cleaning Maintenance and Transport CC and Zikhulise Auto Restorers – both with extensive tax woes – are being wound up. Concurrently the couple have applied for business rescue, although it is unclear for which businesses.
While Zikhulise Cleaning Maintenance and Transport’s tax woes hark back to the 2014 settlement agreement with SARS, Zikhulise Auto Restorers is the subject of a January high court judgment in terms of which it owes SARS R2,880,724 in unpaid taxes and penalties.
In the interim the Mpisanes have set up a new entity called Zikhulise Group, formed in March 2016. According to SARS it was created to “receive funds due to Zikhulise Cleaning Maintenance and Transport from various municipalities, in an attempt to hide/dissipate such funds, to the detriment of SARS and other creditors”. In court papers it is alleged that the new company had already received R52m between April and June 2016.
The Sunday Tribune reported that a preservation order was brought against Zikhulise Cleaning Maintenance and Transport CC, Zikhulise Auto Restorers CC, Inyanga Trading 559 (Pty) Ltd, Royal Eagles Football Club and Zikhulise Auto Recoveries (Pty) Ltd as well as Madoda Mbeje, a trustee of the Sbusha Trust, effectively freezing all their assets.
Between 2011 and 2014 SARS was the complainant in a criminal case against the Mpisanes, and their company Zikhulise Cleaning Maintenance and Transport, of which Shauwn was the sole director. Combined, they faced 183 charges of tax fraud, forgery and bribery over their 2008 and 2012 tax assessments (see nose205). But the National Prosecuting Authority and SARS, despite what appeared to be overwhelming evidence, withdrew the case against them, alleging that the prosecution had been irreparably tainted by the alleged misconduct of KZN senior prosecutor, Advocate Meera Naidu. Naidu was summarily suspended and blamed for the acquittal by then Director of Public Prosecutions Mxolisi Nxasana.
Two years later Naidu was cleared of all charges and reinstated at the conclusion of a disciplinary hearing. Adv Justice Mnisi, who presided over the hearing, said the treatment of the prosecutor was a “travesty of justice” and questioned the NPA’s motives for dropping the Mpisane matter.
In 2014 Shauwn went directly from the dock to the swanky five-star The Square Boutique Hotel in Umhlanga to attend a special tax court set up by SARS. The settlement reached there was never made public but it now appears that the current action by SARS is on account of her reneging on at least part of the agreement reached at the hotel.
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