Earlier this year, the investigative outfit Scorpio exposed how in late 2018, just months after the Unemployment Insurance Fund (UIF) made a second investment in Bounty Brands, the consumer goods group found itself in a debt crisis — prompting a drastic restructure that saved it from financial ruin but left the UIF’s shares worthless. 

Read in Daily Maverick: UIF’s R1.8bn loss: Shayne vs Bounty Brands

Read in Daily Maverick: Bounty Brands’ ‘dodgy’ dividend: R530m from doomed UIF investment flowed to shareholders’ offshore accounts

Now Scorpio has tracked about R530-million of the UIF’s money through a complex network back to its UK holding company — Bounty Brands Holdings (UK) — and unearthed how it was apparently paid out to shareholders as dividends. 

In response to questions from Eyewitness News (EWN), UIF spokesperson Makhosonke Buthelezi emphasised that the fund had granted the Public Investment Corporation (PIC) a mandate to make investments on its behalf. 

“The PIC runs its own investment processes, which we have been assured include thorough due diligence of all envisaged transactions,” he said. 

Buthelezi said, though, that the PIC regularly reported back to the fund on the performance of these investments. 

“As such, the fund has recently been made aware of the investments in Bounty Brands,” he said. 

“The UIF deplores the alleged malfeasance in Bounty Brands, and we understand the PIC has instituted an investigation which we believe will result in recovering the funds,” he said. 

He said the UIF commissioner — together with the UIF advisory board — would be meeting with the PIC in the coming days to discuss the matter. 

As with any investment, Buthelezi said, the fund had been expecting high returns on these investments — which would have been used in projects aimed at “creating new jobs, sustaining current jobs, and retraining and reskilling unemployed former UIF contributors and youth”. 

Going forward, meanwhile, he said that the PIC had assured the fund of improvements in its due diligence processes and that the fund “will continue to exercise oversight over the PIC’s investment activities through established governance structures and processes”. DM