News / National
Businessman remanded for mortgaging council land
23 Nov 2018 at 05:36hrs | Views
A HARARE businessman, one of the shareholders of Augur Investments that won a tender to construct Airport Road, appeared in court yesterday facing fraud allegations after he mortgaged City of Harare land to NMB Bank for a $1,5 million loan before it was repossessed.
Michael Van Blerk (59) was not asked to plead when he appeared before magistrate Rumbidzai Mugwagwa, who remanded him in custody to November 30, pending finalisation of investigations. Allegations are that on June 22, 2007, the City of Harare and Augur Investments entered into a memorandum of understanding (MoU) for the development of Hopley Commercial Area (Mbudzi Project), provision and development of middle housing and construction of a hotel at Mabelreign Golf Course and Mukuvisi Phase 1. It is alleged in terms of the MoU the parties formed a joint venture company, Sunshine Development (Private) Ltd, as the special purpose vehicle.
The MoU stipulated that Augur Investments was to provide funding for procurement of materials, equipment and working capital constituting 70% shareholding, while the City of Harare would provide land constituting 30% of shareholding. The State alleges council processed all the documentation for the project and transferred land to Sunshine Development (Private) Ltd as per agreement.
Blerk and his accomplices, who are still at large, had misrepresented to the City of Harare that they had the 70% capital for the project. It is alleged Blerk and his accomplices, unlawfully took title deeds for the land measuring 6 160 hectares transferred by Harare to Sunshine and misrepresented to NMB Bank that they had a board resolution to acquire a mortgage bond for $1,5 million to fund the Mbudzi Project. It is alleged when Blerk and accomplices made this misrepresentation they knew that the title deeds belonged to Sunshine Development (Private) Ltd and had no authority from shareholders to use the deeds as surety.
Blerk and accomplices failed to service the loan resulting in the land being transferred to NMB, again without the knowledge of City of Harare, thereby prejudicing Harare of $1,5 million and nothing was recovered. Sebastian Mutizirwa appeared for the State.
Michael Van Blerk (59) was not asked to plead when he appeared before magistrate Rumbidzai Mugwagwa, who remanded him in custody to November 30, pending finalisation of investigations. Allegations are that on June 22, 2007, the City of Harare and Augur Investments entered into a memorandum of understanding (MoU) for the development of Hopley Commercial Area (Mbudzi Project), provision and development of middle housing and construction of a hotel at Mabelreign Golf Course and Mukuvisi Phase 1. It is alleged in terms of the MoU the parties formed a joint venture company, Sunshine Development (Private) Ltd, as the special purpose vehicle.
The MoU stipulated that Augur Investments was to provide funding for procurement of materials, equipment and working capital constituting 70% shareholding, while the City of Harare would provide land constituting 30% of shareholding. The State alleges council processed all the documentation for the project and transferred land to Sunshine Development (Private) Ltd as per agreement.
Blerk and his accomplices, who are still at large, had misrepresented to the City of Harare that they had the 70% capital for the project. It is alleged Blerk and his accomplices, unlawfully took title deeds for the land measuring 6 160 hectares transferred by Harare to Sunshine and misrepresented to NMB Bank that they had a board resolution to acquire a mortgage bond for $1,5 million to fund the Mbudzi Project. It is alleged when Blerk and accomplices made this misrepresentation they knew that the title deeds belonged to Sunshine Development (Private) Ltd and had no authority from shareholders to use the deeds as surety.
Blerk and accomplices failed to service the loan resulting in the land being transferred to NMB, again without the knowledge of City of Harare, thereby prejudicing Harare of $1,5 million and nothing was recovered. Sebastian Mutizirwa appeared for the State.
Source - newsday
