South Africa’s financial service regulator is still considering what penalty former Steinhoff CEO Markus Jooste must pay for sending a warning SMS to friends to sell their shares a week before the group’s stock collapsed.
Jooste, who resigned from Steinhoff in late 2017 when the first signs of a major accounting scandal came to light, was fined R162 million in October 2020 by the Financial Sector Conduct Authority for insider trading.
He was found guilty of sending an SMS to four friends, warning them to get rid of their Steinhoff stock immediately.
But the fine was set aside on appeal by the Financial Services Tribunal (FST) in December last year.
The FST struck down one of the two offences Jooste had been found guilty of, ruling that the former Steinhoff CEO did not disclose “precise” inside information to his friends.
At the same time, it upheld the ruling that Jooste had encouraged his friends to sell their shares, meaning he had engaged in insider trading. It then referred the matter back to the FSCA for “reconsideration”.
The FSCA said this week that it was not made a decision yet on what Jooste’s new fine would be.
“The matter is receiving attention and the enforcement process is underway,” it said.
“This process will entail inviting Mr Jooste to make further submissions to the FSCA on the revised penalty.”
Jooste is also being investigated by authorities in South Africa and Germany for his role in Steinhoff’s multi-billion rand fraud scandal.
German prosecutors have charged him for balance sheet fraud, but the matter has not yet gone to trial. He has not yet been charged by the Hawks. Jooste has consistently denied any wrongdoing.
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