Lebogang Mogashoa, Pension Funds Adjudicator

On Robben Island, once the fortress of conscience where Nelson Mandela and fellow freedom fighters endured iron bars for the sake of truth, a Chief Financial Officer (CFO) of Robben Island Museum has been accused of bending truth itself by cooking his résumé.

And when the fraud was exposed, he was dismissed and his withdrawal benefit of  R389 534.33 was frozen by the pension fund, on instruction from his employer, pending criminal proceedings.

He cried foul, insisting the fund had no right to withhold his money. But the Pension Funds Adjudicator, Lebogang Mogashoa, disagreed. With the gavel of reason, Mogashoa ruled that the fund was justified in keeping the benefit on ice until the courts decide whether dishonesty deserves a payout.

The complainant was employed by Robben Island Museum from 1 June 2023 to 12 June 2025 as CFO and was a member of the Alexander Forbes Retirement Fund. On 13 July 2025, the employer notified the fund that the complainant had been dismissed for alleged fraud following a disciplinary hearing and requested the withholding of his withdrawal benefit.

The employer claimed it suffered loss or damage as a result of alleged fraud and misconduct by the complainant in falsely claiming to be a member of the South African Institute of Chartered Accountants (SAICA) when he was appointed as CFO from 1 June 2023 until his dismissal. The financial loss related to remuneration that was paid to the complainant in excess of R2 000 000 for a position he was not qualified to hold.

On 16 September 2025, the fund notified the complainant of the employer’s request to withhold his withdrawal benefit and afforded him an opportunity to make representations. On 25 September 2025, the complainant submitted his representations to the fund through his legal representative. The fund subsequently decided to withhold the complainant`s withdrawal benefit on 17 October 2025, pending finalisation of the criminal proceedings.

The complainant said he had not been charged criminally nor had he been personally served with a civil claim of unjustified enrichment. He indicated that seven months had passed since the employer first communicated its intention to institute legal action against him and he had not yet been charged by the SAPS, nor had he been sued for purported dishonest misconduct.

The fund stated in its response to the Adjudicator that the employer and the complainant were engaged in multiple litigation proceedings against each other.

The fund submitted that it was informed by the employer that it was in consultation with its legal consultant in order to quantify the total loss caused to it by the complainant’s fraudulent misrepresentation. His withdrawal benefit was unlikely to cover the outstanding legal costs and estimated damages of approximately R3 000 000.

On 25 September 2025, the complainant’s legal representative informed the employer that the claim of fraudulent misrepresentation was misplaced. An explanatory affidavit signed by the complainant on 21 February 2025 confirmed that his SAICA`s membership was terminated due to non-payment of fees.

The fund submitted that section 37D of the Act provides for the protection of the employer’s right to recover losses caused through theft, fraud, dishonesty or misconduct of employees. Implied in the section, is the right to withhold benefits pending the determination of proceedings against the member, which if successful, would entitle the fund to make the relevant deduction from the member’s benefit.

The employer said it had opened a criminal case against the complainant. The case was currently with the prosecutor for further directives.

The employer stated that for the period 6 December 2022 to 12 June 2025, the complainant earned a salary under false pretence arising from his alleged misrepresentation and he received a total amount of R4 353 711.84. It stated that the complainant’ s pension benefit was R388 192.67 and the quantum of loss exceeded the pension value.

It stated that the prima facie case of alleged fraud and misrepresentation against the complainant was supported by the SAICA affidavit which indicated that his name did not appear on its register of Chartered Accountants.

The employer said the other justification for withholding the benefit was supported by the legal steps initiated and the criminal matter which was under prosecutorial review, and it attached a letter dated 2 December 2025, wherein it demanded an amount of R4 353 711.84 from the complainant.

The employer also submitted that it incurred costs in the region of R3 000 000 as a result of defending applications by the complainant in court, which were dismissed. The employer also submitted that it incurred irregular expenditure in the amount of R2 000 000  from procurement irregularities as a result of the complainant`s malfeasance.

In his determination, the Adjudicator said it was legally permissible for a retirement fund to make a deduction from a member’s benefit in order to compensate the employer for damage suffered by the employer as a result of theft, fraud, dishonesty or misconduct perpetrated by its employee who is a member of that retirement fund.

He said in this matter, the employer submitted it has established a prima facie case against the complainant on the grounds that the alleged fraud and misrepresentation by him is supported by the SAICA affidavit which indicates that the complainant`s name does not appear on its register of Chartered Accountants.

A fund may only invoke section 37D(1)(b) if the conduct is dishonest or has an element of dishonesty. The affidavit from SAICA indicates that the complainant does not appear on its register of Chartered Accountants. At prima facie, the conduct constitutes an element of dishonesty.

“In this case, although the employer has not instituted a civil claim for damages, it has sent a letter of demand invalidating the employment contract and seeking damages from the complainant. Further, the criminal matter is currently in the hands of prosecutors and the employer is not responsible for any delay in this regard.

“Therefore, I am satisfied that the loss alleged against the complainant arises from dishonesty. Thus, the withholding of his benefit is substantively lawful,” the Adjudicator said.

He added the complainant was afforded an opportunity to make representations regarding the allegations against him and the fund made a decision after considering the representations. Therefore, the withholding of his withdrawal benefit was procedurally lawful and complied with the audi alterm paterm principle.

The complaint was dismissed.

ENDS