Spar CEO Brett Botten will be retiring from his role at the end of January, the company has confirmed.
The announcement, which was issued to the company’s shareholders on Thursday, comes amid allegations of financial impropriety, racism against black franchisors and alleged dodgy accounting.
Spar has battled a wave of negative publicity emanating last year, which involved allegation that it had manipulated the value of stores, fictitious loans and discrimination against black franchisees.
Eyewitness News reported that legal firm Harris Nupen Molebatsi Attorneys found widespread fronting and fraud in some Spar franchises.
Three fraudulent loans reported by retailer Spar are believed to be “isolated” incidents, a statement released on Thursday by the company stated.
Spar has conceded that ‘fictitious’ and ‘fraudulent’ loans flagged by its auditors and a team of lawyers, were reportable irregularities, saying they should have never happened.
“Over the past month, Spar and the external auditors have conducted investigations into the matter. At the end of the process, the board agreed with Spar’s auditors that a reportable irregularity had occurred. Spar’s auditors are satisfied that this was an isolated matter and is no longer taking place, and adequate steps have been taken for the prevention of any loss as a result thereof.
“However, the board concluded that the loan did not seem to have served any real commercial or economic purpose and should not have taken place. The board confirms that the extensive review of all loans arranged by Spar for retailers identified two other transactions of similar nature,” the statement said.
The company said the combined value of the three loans amounted to R11 million and was made five years ago.
“This arrangement is not Spar practice and there is no evidence to support any allegations of accounting irregularities with any other loan transaction.”
Source: Jacaranda FM, Eyewitness News, Business Tech, Moneyweb, image from Twitter: @ThandiDesi