Convicted fraudster ‘biggest loser’

Insurer received fraudulent claims of nearly R200m in three years, investigator tells PE Commercial Crimes Court


In a matter of three years, Mutual and Federal received fraudulent claims of just under R200m – and, at the end of the day, it was the innocent clients who had to foot the bill when their premiums went up.Port Elizabeth businessman Stuart McLeod was just one of those responsible for a fraudulent claim, after setting fire to machinery at his Newton Park business and claiming more than R6m on March 1 2015.But with his elaborate plan having blown up in his face, the convicted fraudster on Tuesday tried to convince a magistrate that the closure of his embroidery business and the great embarrassment of the charges had rendered him the “biggest loser” – or maybe even the only loser.Defence advocate Hannelie Bakker told the Port Elizabeth Commercial Crimes Court in mitigation of sentence that the now down-and-out businessman never received a cent after the fire at Embroiderite, and had instead been left red-faced and financially dependent on his schoolteacher wife.But the family man’s selfpity irked the prosecution, with state advocate Tjaart van Zyl recalling the urban legend of a man who admitted to killing his mother and father and then tried to mitigate that he was an orphan.McLeod, 56, was found guilty of arson, fraud and obstruction of justice in April, after he was caught on CCTV footage seemingly setting fire to machinery at the firm’s 7th Avenue premises.Magistrate Lionel Lindoor will hand down sentence on Thursday.Mutual and Federal investigator Clinton Frieselaar testified that in 2016 alone they had received fraudulent claims totalling R111m.Many more slipped through the cracks.“Ultimately the members of the public foot the bill through a rise in premiums,” he said.Lindoor remarked that this was why the crime could not be considered a faceless crime.Bakker, who asked that a non-custodial sentence be implemented, said the keen golfer had been embarrassed by the media coverage.“I’m not going to try and convince the court the offences are not serious, but they came at a great cost to [McLeod].“He was the biggest loser in this regard ... it wiped him out,” Bakker said.She said Embroiderite was forced to shut its doors after the insurance claim was rejected and McLeod was now running a very small business from different premises.He suffered a heart attack in August 2010. Van Zyl countered that McLeod could not use what he had lost as a mitigating factor.Fifteen employees at Embroiderite had lost their jobs.He said McLeod, who continued to maintain his innocence, had shown no remorse and had done everything in his power to avoid taking the stand.While it was heard during trial that he owed the taxman R180,000 and that perhaps the business was not doing as well as anticipated, the exact motive for the insurance fraud was never given.Van Zyl said the footage – which McLeod initially tried to conceal from the police – showed how he had prepared the delayed fire in a calculated and manipulative manner.“Yes, the claim was not paid out, but not because of the accused, he did everything in his power to have the claim paid,” Van Zyl said.He said a term of imprisonment was the only appropriate sentence.McLeod is out on warning.

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