<\/p>\n
The Equality Court in the Western Cape heard on Tuesday that the South African Reserve Bank (SARB) and the Prudential Authority have a direct and substantial interest in the application brought by the Sekunjalo Group.<\/p>\n
This as the statutory bodies filed an interlocutory application for the dismissal of the complaint brought against them by Sekunjalo Group and its chairman, Dr Iqbal Surv\u00e9, alleging that the statutory bodies contravened sections of the Equality Act.<\/p>\n
Sekunjalo Group filed papers last year asking the court to declare that the banks\u2019 conduct constitutes unfair discrimination and that their decisions to close the group\u2019s and its related entities\u2019 bank accounts should be overturned.<\/p>\n
The SARB and Prudential Authority told the court on Monday that Sekunjalo\u2019s complaint was built on the unsustainable proposition that the two institutions contravened their statutory duty because they have a statutory duty.<\/p>\n
In wanting the complainant to be dismissed, the SARB and Prudential Authority asked for an order for costs on a punitive scale as they contend that Sekunjalo failed to make out a prima facie case against them.<\/p>\n
Arguing before acting Judge Peter Hathorn, advocate Vuyani Ngalwana, SC, said the basis for complaint of misjoinder was anchored in the claim that no relief was sought against the SARB and Prudential Authority and that the orders sought did not apply to their rights and obligations.<\/p>\n
Ngalwana said it was not a requirement for a joinder that relief be sought against the party joined.<\/p>\n
\u201cWe say the SARB and Prudential Authority have a direct and substantial interest, as regulators of banks, in the determination of the main case which charges the banks with, among other things, irrational, unlawful and unconstitutional de-banking of the entire Sekunjalo Group, thereby triggering a systemic event as defined in the Financial Sector Regulation Act, 2017, on the ground of alleged \u2018reputational risk\u2019 to the banks.\u201d<\/p>\n
Ngalwana told the court that the claim that Sekunjalo Group failed to make out a case against them was a misconstruction of the law on the joiner.<\/p>\n
\u201cNo case needs to be made out against a party whose rights might merely be affected by an order of court.\u201d<\/p>\n
He also said as regulator of banks and charged with issuing, suspending and revoking bank licences, the SARB and Prudential Authority have a legal interest in how the banks conduct themselves in relation to their customers.<\/p>\n
\u201cWhile their legal interest does not extend to intervening in contractual relations between banks and their customers, the banks\u2019 wholesale targeting of a group of companies \u2013 in what the Sekunjalo Group alleges is conduct that is not supported by the empowering prescripts \u2013 does trigger the obligations of the SARB and Prudential Authority.\u201d<\/p>\n
Ngalwana added that the SARB and Prudential Authority were organs of state and have a constitutional obligation to assist the court to ensure its effectiveness, among other things, in the determination of the legal dispute between the respondent banks and the Sekunjalo Group.<\/p>\n
\u201cThis is not a \u2018fishing expedition\u2019. It is an obligation imposed by the Constitution upon the SARB and Prudential Authority as organs of state.\u201d<\/p>\n
He told the court that the SARB was supposed to police compliance with banking regulations and that it has the power to suspend and withdraw banking licence if there was a lack of compliance.<\/p>\n
However, Ngalwana said Standard Bank and FNB were still banking with white-owned companies like EOH and Tongaat Hulett that admitted to committing corruption and yet not with<\/p>\n
Sekunjalo, a black-owned company. He also said if there was a challenge to constitutional validity of regulations that the SARB has a statutory obligation, it could not say the order did not affect its obligations.<\/p>\n
\u201cBecause the Reserve Bank has statutory obligation when there is a challenge to constitutional validity to those regulations, the Reserve Bank has an interest because the constitutional challenge to those regulations is direct and substantial interest to the subject matter.\u201d<\/p>\n
Ngalwana dismissed suggestions that the complaint against the statutory bodies was hearsay and were inadmissible evidence and should be excised.<\/p>\n
\u201cIt does not identify the specific paragraphs that constitute hearsay evidence.\u201d<\/p>\n
Advocate Geoff Budlender for the SARB and Prudential Authority is expected to make an oral reply when the court case resumes on Thursday.<\/p>\n
Cape Times<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":" The Equality Court in the Western Cape heard on Tuesday that the South African Reserve Bank (SARB) and the Prudential Authority have a direct and substantial interest in the application brought by the Sekunjalo Group. This as the statutory bodies filed an interlocutory application for the dismissal of the complaint brought against them by Sekunjalo […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[18],"tags":[3991,11565,536,2488,6971,11564,14999,12508,16042],"class_list":["post-208108","post","type-post","status-publish","format-standard","category-politics","tag-application","tag-authority","tag-court","tag-group","tag-interest","tag-prudential","tag-sarb","tag-sekunjalo","tag-substantial"],"yoast_head":"\n