By Sean Goss. You can find him on Twitter @GossSgafc
When I came into the owner driver game there were already substantial players. ABI/SAB already had these schemes operating within their depots across the country. Unions were vigorously opposed to them. My consulting firm was rendering normal services to entrepreneurs.
A few owner drivers wanted a Black firm to act as “Management Company”. We thus set up an additional firm, known as, Full Colour.
Within a month from the launch I faced difficulties with ABI management, for questioning their remuneration model. The problems surfacing in many probes today were identified way back then.
The Owner Driver Scheme that I built from the ground-up was the Nestle Scheme (1999 to 2003). This happened after drivers from Nestle approached me to explore this opportunity for “Black Empowerment”. We immediately approached management, who were very elated to “outsource” their logistics, and minimize union activity within the sector. With the logistics managers, we vigorously crunched the numbers and refined our costings of the models, to avoid the problems bedeviling other schemes. In short our model factored in all potential costs and guaranteed profits for the drivers. It was a success, until it was scuppered.
I devised an empowering model that would “hold hands” and gradually guide these budding entrepreneurs into self-empowerment. The model was two-pronged, i.e. rates would be paid into a trust account, vehicle leases would run from this account, with public, and goods in transit insurance. Surpluses would then be paid to the individual drivers’ bank accounts. Productivity shot through the roof and Nestle drivers were outperforming other schemes such as SAB/ABI, Kimberley Clarke, etc.
We concluded finance and logistic/fleet agreements with Standard Bank, which I had brought onboard. At the initial stages we managed two depots, Isando and Pretoria. Parties to the agreement were, Full Colour, Standard Bank, Nestle and the Drivers.
Within 6 months a white-owned management company was contracted to operate the rest of of the country (using my intellectual capital). This I regarded as fair competition, and had no qualms, even if they stole my strategies – until the Pretoria depot management made allegations of theft and fraud against me, summoned me to a meeting where I was humiliated by Standard Bank, (that I gave the business). This was in the year 2000. Deloitte (Nestlé’s auditors), audited the trust account, and save for some admin errors found no impropriety. The management, however terminated the contract, and I let it be…
A year later (2001), management at Isando started circulating rumours that I was “stealing” the owner driver’s money. In the spirit of transparency, I regularly provided management accounts and bank statements, dispelling all their fears. Drivers were doing well, earning more than Nestle bosses. A comical situation arose when management would claim I’m “stealing from the drivers” and yet complain in private meetings, that I was “paying them too much.” They would recommend that I operate like other management companies, or like Terrafin Holdings Ltd. I was shocked to learn that Terrafin, owned by Willie Rautenbach was contracted to Nestle. Google the fraud and theft that this company was responsible for, covered-up by Standard Bank and the press. Only Noseweek investigated this corruption.
Stannic goes along with R15m Fraud http://www.noseweek.co.za/article/98/STANNIC-GOES-ALONG-WITH-R15M-FRAUD
I resisted all their efforts to become part of the “management company” system, i.e. being one of the anointed companies contracted to Nestle, paying the drivers a minimum wage and giving work to mostly white service providers. WEE. I empowered mostly black service providers.
Then the wheels came off. Nestle notified me that “their auditors”, Deloitte, were commissioned to conduct a forensic audit on my scheme, due to “countless allegations of theft”. I was prepared to co-operate but then I remembered that I lost a previous contract at Nestle Pretoria. After legal advice I informed them that I would not co-operate and that they could do whatever…I wasnt afraid of them.
As an accountant I have many friends in the industry and thus assembled and procured a specialized team of chartered and forensic accountants. We scoured through the records of the lost contract in Pretoria and uncovered huge fraud. (Bank statements and correspondence were still emailed/mailed inadvertently by bank). We pored over all this material and compiled a huge report, highlighting the malfeasance on the part of the White Management Companies.
Nestle management were unaware of my investigations. When summoned to their meeting on 9th October 2002, I brought my material with bundles for all parties present. Management looked confident and assumed I would be pliant, like before. I surprised them with my damning report and shocked them further by suggesting that the Scorpions be brought in to investigate their entire scheme, and that Deloitte could not be trusted since they were implicated in Terrafin cover-up and other worldwide audit scandals (then rife in 2002).
What surprised me was how these normally diplomatic managers/ business people turned into foul mouthed rude people. They verbally attacked me and tried to cast aspersions on my character. I dug in my hills and decided to leave but knew I have upset their little applecart.
Within one day, my normally cordial Black partners turned hostile. I then learned that they were called by Nestle and instructed “to talk to me”. I would not budge. I senior director from Deloite turned up unannounced and begged me not to proceed with the investigations. A week later my “partners “changed the locks on our office, kicked me out, blocked me from accessing the bank accounts (bank never notified me) and I was left destitute and unemployed.
I then sued Nestle for R1million rand and my lawyers commenced with preparations. Mysteriously one evening I was followed by a 4×4. Several attempts to drive me off the road were made. I contacted my friends, who came to my aid and we drove the thugs away. Documents filed at my house, also mysteriously disappeared, after a”Telkom Visit.” I suspect it was all part of a ploy to bully and scare me into dropping the investigation.
My family pleaded with me to drop the case for my safety and move on, which I did. But when looking at events today – the bully tactics and thuggish behaviour of established business such as the “closure of opponents bank accounts” and your own Black people sell-you-out for money and economic terrorism, I can relate.
Sean Goss is a Chartered Accountant