Botselo Mills manager convicted of R8.7 million fraud after years of fraudulent payments

Reginald Scholtz, 61, has been convicted on 52 counts of fraud involving more than R8.7 million defrauded from Botselo Mills while he was employed as the company’s group financial manager.

A former group financial manager at Botselo Mills has been convicted on 52 counts of fraud involving more than R8.7 million after diverting company funds into bank accounts linked to him through allegedly fraudulent payment transactions spanning five years.

Reginald Scholtz, 61, was convicted in the Specialised Commercial Crime Unit (SCCU) Court sitting at the Molopo Regional Court in North West following a prosecution by the National Prosecuting Authority (NPA).

The fraudulent transactions were committed between 2017 and 2022, while Scholtz was employed as the company’s group financial manager.

NPA spokesperson Lindiwe Mabasa said Scholtz manipulated the company’s payment system to make it appear as though payments were being made to service providers for services rendered, when the funds were instead transferred into bank accounts linked to him.

“The transactions were recorded as legitimate payments to service providers,” Mabasa said.

The fraud was uncovered during an audit in 2023 after the company’s chartered accountant identified unaccounted-for payments in the payment system.

“The discovery prompted an investigation, which ultimately led to Scholtz’s suspension and subsequent arrest,” Mabasa said.

Scholtz was initially charged with 61 counts of fraud relating to unauthorised transactions involving payments from the company’s account.

The State, represented by Advocate Nkhetheni Mudau, argued that Scholtz had abused the trust placed in him by his employer and deliberately engaged in fraudulent conduct that caused significant financial prejudice to the company.

“In his defence, Scholtz argued that the company had failed to prove that the accounts receiving the payments did not belong to legitimate service providers,” Mabasa said.

He maintained that only three of the accounts belonged to him, claiming they were used to manage petty cash on the instructions of his managers.

He further claimed that he feared losing his job if he failed to comply with what he regarded as lawful instructions.

After considering the evidence, the court acquitted Scholtz on nine counts relating to petty cash transactions and payments to other service providers.