subscribe Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Subscribe now
SA Reserve Bank governor Lesetja Kganyago. Picture: FREDDY MAVUNDA
SA Reserve Bank governor Lesetja Kganyago. Picture: FREDDY MAVUNDA

Months after burying the hatchet in protracted litigation between insurer 3Sixty Life and the Prudential Authority (PA) another battle is brewing over the regulator’s continued placement of the company under curatorship. 

3Sixty’s CEO, Khandani Msibi, fired the first shots last week after Reserve Bank governor Lesetja Kganyago told parliament’s standing committee on finance that curator Fagmeedah Petersen-Cook and her team were still finalising audits and there were material breakdowns in controls in the company. 

“The appointed curator and the team are finalising the outstanding 2020, 2021 and 2022 audits, together with the external auditors of the firm. The audit processes are protracted as there has been material breakdown in critical controls within the insurer during the audit process,” said Kganyago.

Msibi has raised questions about 3Sixty’s continued placement under curatorship for 22 months since the PA was granted provisional curatorship in December 2021.

“We run a group of companies and all of them have up-to-date annual financial statements except for one, 3Sixty Life. 3Sixty Life was placed under curatorship in 2021 and we still don’t have 2020 financials. 3Sixty Life recapitalised itself but the governor told parliament the reason we are still under curatorship after 22 months is because there are no-up-to-date financial statements. He didn’t mention solvency and liquidity because the business recovered. He has kept the business under curatorship for two years and failed to complete annual financial statements and that failure is the reason we are under curatorship,” said Msibi. 

The two parties had in February buried the hatchet when the PA and the suspended directors of 3Sixty Life agreed that the latter’s appeal in the Supreme Court of Appeal should be dropped as it was not in the best interests of the policyholders of 3Sixty Life. This resulted in Petersen-Cook being appointed as the final curator.

Dismissed consultant

Msibi has now accused the PA and curator of delaying the removal of 3Sixty from curatorship when Petersen-Cook allegedly terminated the services of the actuarial and accounting firms.

“She has dismissed the financial consultant that was helping with the audit and dismissed the internal audit firm. 3Sixty life was placed under curatorship over solvency, but the PA changed its position midstream and made it about the availability of annual financial statements … a curatorship of 20 months without new business is excessive, the prohibition of new business on its own will kill 3Sixty Life. Sadly our strategy to protect 3Sixty Life also placed the rest of the group at risk and sacrificed the earnings of our staff members and the group,” said Msibi.

He has alleged that the motivation for the continued curatorship were excessive fees paid to the curator. Msibi said the initial curator appointed in the provisional curatorship was paid R400,000 whereas the existing curator is paid more than R2m. However, the PA has denied the allegation and said that the curatorship was in the best interests of the policyholders. It, however, didn’t respond directly to the questions on whether Msibi’s claims were accurate about the alleged discrepancies in the curator’s remuneration.

The remuneration of the curator is approved by the PA and based on guidelines in relation to relevant legislation governing the curatorship. The PA scrutinises the monthly invoices of the curator before approval is given to the curator to settle such invoices from the assets of the insurer. In addition to the curator’s own remuneration for the work that is expected, the curator may also, in consultation with the PA, employ the services of legal, accounting, technical and other professional resources to assist in the performance of the curator’s duties,” said Reserve Bank spokesperson Ziyanda Mtshali. 

She said the PA has no intention of liquidating 3Sixty. “The PA remains of the view that the curatorship of 3Sixty Life is in the best interest of its policyholders. The PA will continue to work together with the Financial Sector Conduct Authority and the curator to ensure 3Sixty Life’s policyholders continue to be properly protected during this process,” said Mtshali.

The PA said the business will be handed back to the board and executive when the company meets the prescribed requirements. The majority of 3Sixty policyholders come from the National Union of Metalworkers (NUM) led by Irvin Jim.


subscribe Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Subscribe now

Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.

Speech Bubbles

Please read our Comment Policy before commenting.