Shaheen Moolla vs Sunday Times

Complainant: Shaheen Moolla

Article: Graft-buster accused of fishy-deal fraud

Date: 08 September 2011

Respondent: Sunday Times

Ruling by the Deputy Press Ombudsman September 8, 2011 This ruling is based on the written submissions of Mr Shaheen Moolla and the Sunday Times newspaper. Complaint Mr Shaheen Moolla complains about a story in the Sunday Times, published on 31 July 2011 and headlined Graft-buster accused of fishy-deal fraud. Moolla complains that the story: •unfairly and inaccurately said that both he and his company, Feike, were involved in a fraudulent contract; •failed to publish material information that Feike had provided the journalist with; and •inaccurately states that he and Feike sold fish. Analysis The story, written by Bobby Jordan, says that the man who previously helped the government to stamp out fraud and corruption in the country’s R70-billion industry (Moolla) “now faces a fraud charge over a fishy deal”. The story says that Moolla, who is the former head of fisheries management and also a co-owner of one of the country’s biggest fishing consultancies, allegedly sold 2 500 tons of pilchards on behalf of black quota holders to two companies “who paid over R300 000 into his account”. The story continues: “But according to documents submitted to police, the quota holders had no intention of selling their fish – and never gave anybody permission to do so.” Moolla reportedly stood accused of trying to rip them off – an accusation that he denied. Instead, he reportedly said that he had “acted in good faith” as a consultant for a businessman (Mr Yusuf Achmat) who claimed to represent the fishermen, but “who later turned out to be a crook”. The story goes on to say that, according to documents at the newspaper’s disposal, Achmat approached Moolla with a proposed deal to sell fish belonging to four black quota holders and claimed that he acted for these companies. However, the companies reportedly denied that they ever gave anybody permission to sell their fish. The story then says that Moolla drew up contracts with two larger fishing companies, Gansbaai Marine (GM) and Ixia Fishing (IF), to catch pilchards and process them. The story continues: “Ixia confirmed they paid Moolla over R80 000 commission for the bogus deal, which Moolla is refusing to pay back. He insists he earned the commission, despite the fact that the fish never arrived. Ixia disagrees.” The story also says that IF and GM paid Moolla R225 000 upfront, but Moolla reportedly said that he had paid that money over to Achmat. I shall now look at the merits of the complaint: Involved in a fraudulent contract Moolla complains that the story unfairly “and based on factual inconsistencies” seeks to establish that both Feike and himself were somehow guilty of being involved in some fraudulent or “fishy” contract. He adds that it was rather Feike that: •exposed fraud on Achmat’s part by publishing details of the matter on its blog and in the magazine Fishing Industry News; •commenced legal proceedings against Achmat; and •reported Achmat’s “fraud and illegal conduct” to SARS and to the Department of Fisheries. Sunday Times denies that the story is unfair or inaccurate. It says: “On the contrary, our reporter spoke to numerous people involved in the incident, as well as to the police, and reported only on facts which were confirmed by several sources or which appeared in court papers.” The newspaper also argues that it is a fact that GM has laid a complaint with the police against Moolla, that the police have opened a fraud docket and that they are investigating the matter. It says: “To report the fact that Mr Moolla is facing a fraud charge is to report a fact.” The central issue here is the question if the story indeed (unfairly) seeks to establish that both Feike and Moolla were guilty of being involved in some fraudulent or “fishy” contract. So let’s now take a closer look at what the story says about Moolla’s “fishy” contract. It says that Moolla: •faces a fraud charge (over a fishy deal) – a statement that he does not deny; •allegedly acted on behalf of black quota holders – it does not state it as a fact; and •stands accused of trying to rip the quota holders off – a statement that is factually correct (as he faces a fraud charge). Based on the above, I can find no reason to accept that the story unfairly “and based on factual inconsistencies” sought to establish that Moolla and Feike were guilty of being involved in some fraudulent or “fishy” contract, as the complaint goes. There is also no an insinuation that he may “somehow” be guilty. Failed to publish material information Moolla complains that the story does not reflect the information that Feike provided the journalist with. He says that he provided Jordan with the following documents “which establish the fraudulent and illegal conduct” by Achmat: •The contact details of people and companies who were previously defrauded by Achmat; •Copies of contracts that Achmat “fraudulently” signed; and •Copies of invoices and bank statements showing the flow of funds from the two respective sellers, IF and GM, into accounts controlled by Achmat. He also argues that the following information was published on Feike’s blog – a site that he says Jordan regularly reads: •IF and GM approached Feike to source their pilchard quota for the 2011 season; •Feike was advised that Achmat, who represented four pilchard quota holding companies, was prepared to sell the fish belonging to these entities, the terms and conditions of which Achmat communicated to Feike in writing; •IF and GM concurred that Feike must proceed with the drafting of the agreements documents, which was presented to Achmat for his signature. These contracts required Achmat to warrant that he was properly authorized to represent and bind the quota holders and to sell the fish concerned; •IF and GM counter-signed the agreements; •IF and GM paid deposits of between 5% and 10% of the total purchase price to Achmat on signature as required by him; •Feike alerted IF and GM that Achmat could subsequently not produce the tax clearance certificates required to uplift the fishing permits for the four corporations; •Another fishing company’s director mentioned that his company had recently been conned by Achmat, and Feike therefore informed IF and GM that Achmat might have been a con-man who signed the sale agreements without any legal authority or mandate; •Feike, with the concurrence of both IF and GM, then appointed a firm of attorneys as well as a debt collecting agency to try to recover the deposits paid to Achmat; •Feike also reported Achmat to SARS as he “had issued fraudulent VAT invoices” for the receipt of the deposits; •IF and GM then suddenly decided to not sue Achmat for the deposits that the latter had received and had been invoiced – for “for reasons only known to Gansbaai Marine and Ixia Trading”; and •Feike remained committed to suing Achmat. Moolla says that these facts were plainly put to Jordan, but that he failed to clearly communicate this in the story – instead, he allowed accusations which are rebutted by contracts, bank statements and Achmat’s prior “examples of fraud” to be stated as fact. Sunday Times replies that its duty was not to accept Moolla’s version of events, but only to present his version fairly, “which we did”. It adds that it also had a duty to present fairly the versions of the other parties involved in the matter. The newspaper adds that Jordan “was not permitted to scrutinize the documents, they were merely waved under his nose”. It argues that, if the documents did in fact prove Moolla’s case, and if he had permitted Jordan to scrutinize them, “the story would have reflected that”. Moolla replies that he wishes to state “emphatically” that he did offer Jordan the documents. He says that the reporter then told him that the intention of the story is not to get into too much detail, but rather to focus on some issues that he (Moolla) has raised in his blog regarding the mismanagement of fisheries. He adds that, had Jordan put the allegations made by IF and GM to him, he would have been able to refute these by referring to the documents. Moolla reiterates that Jordan failed to record that it was Feike and himself who made public the fraud. I am now faced with a situation where the one party says “yes”, Jordan was furnished with information which he did not use, and the other party says “no”, that is not true. In other words, I am in no position to decide if Jordan indeed: •received the information that Moolla says he furnished the journalist with; and •read Feike’s blog that contains the specific information that he refers to. This leaves me with the question if, in general, the story presents Moolla’s side of the story fairly and if indeed there are any grounds for this part of his complaint. My considerations are: •The story gives Moolla ample space to deny the allegations against him; •Moolla’s contention that it is rather Achmat who is the culprit is published; •Achmat’s claim that he acted for the companies was reportedly denied by these companies; and •The purpose of the story is not to come to some sort of conclusion who is right and who is wrong in this whole debacle (that would be the task of a court), but rather to pursue the angle of the story, namely that somebody who helped the government to stamp out fraud and corruption is now faced with a fraud charge himself. I conclude that the issues mentioned above bring balance and fairness to the story and argue against any trace of bias against Moolla and for Achmat. Selling fish The phrase in dispute reads that “Shaheen Moolla allegedly sold 2 500 tons of pilchards on behalf of black quota holders to two companies who paid over R300 000 into his account”. Moolla complains that this is false, saying that neither he nor Feike sell fish. The newspaper says it accepts that Moolla brokered the deal to sell the fish, rather than sell the fish himself. It argues: “However, we submit that the article as a whole makes it abundantly clear that he brokered the deal rather than attempted to sell fish that he had acquired.” I accept that Moolla brokered the deal to sell the fish and that he did not sell the fish himself. However, the newspaper is correct in that the story as a whole makes it clear that he brokered the deal. Also: These two concepts are so close to each other that I find this part of the complaint to be frivolous. Finding The complaint is dismissed in its entirety. Sanction There is no sanction. Appeal Please note that our Complaints Procedures lay down that within seven days of receipt of this decision, anyone of the parties may apply for leave to appeal to the Chairperson of the SA Press Appeals Panel, Judge Ralph Zulman, fully setting out the grounds of appeal. He can be contacted at Johan Retief Deputy Press Ombudsman