The High Court has ordered a public auction of a Mercedes Benz sedan belonging to forex trader-turned-politician Michael Amushelelo.
The court gave the order in favour of Bank Windhoek, which dragged Amushelelo to court after he defaulted on the car’s loan repayment.
Last Friday, Judge Boas Usiku concluded Amushelelo breached the sales agreement between him and the bank and has failed to give a genuine reason in law that would deter the court to rule in favour of Bank Windhoek.
The court ordered a public auction of a 2015 Mercedes Benz E63 AMG.
Furthermore, the court ordered, “payment in the amount of N$220 124.37 plus interest at a prime rate (7%) plus 2% per annum capitalised monthly from 21 July 2021 until the date of final payment.”
Usiku also forfeited to the bank all the money that Amushelelo has already paid to the bank.
According to the sales agreement, the purchasing price of the car was N$1 068 000, of which he deposited N$368 000. The agreement was entered into in July 2019.
The agreement stipulates that Amushelelo had to pay instalments of N$18 186.75 per month over a period of 54 months, starting from 1 August 2019.
However, Amushelelo paid the instalments for only three months with the last payment being effected on 1 November 2019.
The agreement further stipulates that the car will remain the property of the bank until the last instalment, which was scheduled for 1 January 2024.
Should Amushelelo default on his payments, the bank would claim the full outstanding balance, terminate the agreement, repossess the vehicle, and claim damages.
Amushelelo, who admitted to defaulting, said it was not wilful as his bank accounts were frozen and he was prohibited from transacting on those accounts.
Thus, due to the preservation order on his properties, he was unable to fulfil his obligations.
In October 2019, Amushelelo’s assets were seized and bank accounts were frozen by order of a court in the wake of fraud allegations in relation to his activities as a forex trader.
The prosecution has since charged Amushelelo and co-accused Gregory Cloete, four close corporations, a company and a trust controlled by him.
Amushelelo is facing 365 counts, while Cloete is charged with 360 of the counts. These charges range from fraud, alternatively theft by false pretences, conducting banking business without authorisation and conducting a Ponzi scheme, tax evasion, tax fraud, failure to pay tax, money laundering, and racketeering.
In court documents, prosecutor general Martha Imalwa said Amushelelo used his social media accounts to entice the members of the public to believe that he is conducting a business of forex trading and investing in Project One Million. The investors were promised a 50% interest payout within two months.
Approximately N$86.8 million was paid into the bank accounts of Amushelelo and the various entities by members of the public.
A total sum of N$ 64.8 million was paid out for Project One Million investments.
On 23 July 2020, the bank accounts of Amushelelo and the various entities had combined positive balances of N$13.1 million.
Thus, the “scheme” was insolvent as it was unable to make payments totalling N$ 130.3 million to its investors. There is a shortfall of N$43.4 million, making the scheme insolvent.
“Amushelelo used the newer (subsequent) investors’ money to make Project One Million pay-outs to the older (earlier) investors. He used “Forex” and “Ironfx” references on the bank accounts’ transactions to create the impression that he was dealing in forex,” said Imalwa in court documents.
Imalwa said that based on the analysis of the transactions, the positive balance in Amushelelo’s bank accounts consists of money from members of the public.
“The money received for Project One Million ‘investments’ was never reinvested on the forex markets,” said Imalwa.
Amushelelo allegedly used investors’ money for personal use and to fund his other businesses through inter-account transfers.
Amushelelo and his co-accused are awaiting trial before the High Court. - mamakali@nepc.com.na