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J. Arthur Brown of Fidentia Arrested

Scorpions swooped on Fidentia kingpin. J Arthur Brown arrested. In the background lies a tangled web of burned cash, running to well over R1bn. The key victims of a massive scam conceived and perpetrated by Brown and his corrupt network are tens of thousands of widows and orphans registered under the Living Hands Umbrella Trust. In October 2004, R1,1bn belonging to the trust was transferred to Fidentia when Fidentia seized control of Living Hands Pty Ltd, the trust's administrator. This cash enabled Brown and his corrupt network to continue with a bizarre business model that appeared to be based on overpaying for acquisitions, in the hope that fresh cash could be seized to fund past peccadilloes. The business model was utterly unsustainable, and maxed out during the second half of 2006, when the Financial Services Board started to take various Fidentia whistleblowers seriously. n a cruel twist of fate for more than 100 000 widows and orphans, the R93-million paid by Fidentia to take control of the Living Hands umbrella trust administration company was paid with their own money. With an amazing sleight of hand, J Arthur Brown, the executive chairperson of Fidentia, managed to delay the cash payment for the trust company until he replaced the directors of the trust administration company and the trustees of the umbrella trust with his own appointees - and then took the money to pay for the purchase. Then he went on his now well recorded spending spree, buying up a diverse group of companies, both good and bad, and often paying ridiculous amounts with the rest of the R1,4-billion in the coffers of the trust. To make matter worse, Fidentia Asset Management claimed a R48-million take-on fee to put the money on Fidentia's books and commissions for the main directors, with Brown paying himself R4-million for pulling off the coup.

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