Sharemax increasingly paranoid

 The mega-size property syndicator’s lawyers are doing good business threatening journalists and financial advisers. Read about its latest threat.

Botha, Willemse & Wilkinson, attorneys for property syndication company Sharemax Investments, are onto a good wicket. They have drafted countless threatening letters to journalists (including this one) at Sharemax's expense.

Apart from that, they have racked up good fee income in the ongoing legal battle between Sharemax and former financial journalist Deon Basson.

The latest Sharemax job to land in the Botha, Willemse & Wilkinson offices involves a threat issued to financial adviser Andre Matthews.

Matthews had the temerity to author an analysis of Zambezi Retail Park, a Sharemax syndication.

The critique can be read by clicking here.It was distributed to various financial advisers and raises concerns about the Zambezi development.

Says Matthews: "It took Sharemax roughly a day to get a lawyer's letter, threatening me with action for defamation, on my desk. There was no defamation, only an analysis of its prospectus." The letter was written by Coenie Willemse, an attorney for Botha Willemse &Wilkinson.

To read Willemse's letter, click here (letter, pages 1,2, 3 and 4 ). To read Mathews's response, click here.

The main concern raised by Matthews is a so-called "cash flow shortfall fund" which will be used to subsidise investors' income. This is a common theme among Sharemax's syndications, which offer investors a minimum annual cash income.

Matthews is worried that the Zambezi Retail Park fund will be sufficient only for a few months before it is depleted.

Willemse does not address this specific concern in his letter to Matthews.

Matthews argues that there is no justification for investing in the Sharemax project. "It is far better for investors to put their funds in a fixed deposit," he notes. "The risks for the tiny bit of upside the investors might get vesus the probable downside are simply way too great."

Moneyweb has previously noted that some respected financial advisers believe that Sharemax and other property syndications have excessive fees and lack transparency.

This is not the first time that Coenie Willemse has threatened financial services professionals.  The Sharemax website carries an apology from PSG Konsult Academy CEO Jan (JJ) Serfontein.

In a letter addressed to Willemse, which is published on the Sharemax website, Serfontein apologises for allegedly untruthful statements made by independent contract facilitator Adriaan Schutte during a presentation.

Get commercial property news by email

Free alerts when we publish — pick a focus or get everything, unsubscribe in one click. Subscribe »