Deloitte confirmed it is aware of a lawsuit by investors of African Bank Investments Ltd. for the alleged loss of about 2 billion rand ($128 million).
“Deloitte is aware of the lawsuit,” Deloitte Africa Chief Executive Officer Lwazi Bam said in an e-mailed response to questions on Tuesday. “Deloitte takes its responsibilities in regard to being a guardian of public trust very seriously and we believe that we have fulfilled and continue to fulfill this responsibility.”
Investors in the Hlumisa and Eyomhlaba plans, two black economic empowerment shareholders in African Bank, which collapsed in 2014, said in a Dec. 17 summons they lost 729 million rand and 1.3 billion rand respectively in shareholder value due to reckless conduct by the company’s directors, Johannesburg-based Business Day reported on Tuesday. The shareholders say it was “false” of Deloitte to note in its audit opinion that financial statements fairly represented African Bank’s position, and is suing the audit company as well as former and current directors of the bank, the newspaper reported.
“A company’s management has the responsibility for the preparation of financial statements in compliance with relevant accounting standards,” Bam said. We “will vigorously defend any litigation brought against us.”