(Alliance News) - Old Mutual Ltd reiterated on Friday that it planned to appeal a court ruling ordering the financial services group to pay ZAR1.7 billion to widows and orphans invested in Fidentia.
The South Gauteng High Court on Tuesday ruled in favour of Living Hands Umbrella Trust, the custodian of the Mineworkers' Provident Fund, which was set up to pay widows and orphans of workers killed in mine accidents.
The Anglo-South African financial services firm first announced on Wednesday that it will appeal this judgement.
Old Mutual maintains that the direct cause of the loss and pain suffered was the fraudulent actions of Fidentia well after Old Mutual had transferred funds following a formal client instruction to do so.
"In the circumstances and following our verification of the authenticity of the transfer of ownership, we were legally obligated and had no other option but to transfer the money," it said.
"We are of the view that there are reasonable prospects that another court would come to a different conclusion," the company said.
Fidentia embezzled ZAR1.1 billion from the Living Hands Umbrella Trust. J Arthur Brown was the mastermind in the Fidentia scandal. Brown was sentenced to 15 years in jail on December 1, 2014.
Fidentia was placed under curatorship in 2007.
Shares in Old Mutual were up 0.9% at 56.20 pence each in London on Friday, while its Johannesburg shares were 1.6% higher at ZAR11.41.
By Artwell Dlamini; artwelldlamini@alliancenews.com
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Old Mutual Lim. (OMU)