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This legal process is expected to take years and ultimately fail, according to legal opinion obtained by Sasfin.

February 27 2024

Sasfin Holdings announced today that its subsidiary, Sasfin Bank received a civil summons, “unprecedented in South African law”, for a total amount of R4.87bn plus interest and costs, in the form of a damages claim instituted by the South African Revenue Services (SARS).

“This summons related to SARS’ purported inability to collect income tax, value-added
tax, and penalties allegedly owed by former foreign exchange clients of the Bank,” it said.

Subsequent to receiving this summons, Sasfin said it had engaged with “relevant regulators in a transparent manner” and obtained a legal opinion from law firm, ENS, authored by Professor Dale Hutchinson, Professor Michael Katz, and Aslam Moosajee, and endorsed by Advocate Wim Trengove S.C.

“The legal opinion is unequivocal that the claim falls outside of the recognised parameters of applicable law and has a very remote likelihood of success,” it said.

Sasfin CEO, Michael Sassoon, said: “We are confident that the SARS claim has no merit.
We have filed a notice of intention to defend the matter, which we will do rigorously. It is unjust for banks to be held liable to SARS for taxes that their clients have failed to pay,” it said.

The claim relates to the expatriation of money going back to 2014, in which a criminal syndicate colluded with former employees of Sasfin Bank who were operating outside of their scope and authority of employment.

Sasfin instituted an independent investigation which resulted in the termination of relationships with implicated clients and employees and the opening of criminal cases against them. These cases are ongoing.

“Of importance is that this is not a tax claim, but a claim for damages and has nothing to do with
Sasfin’s own tax affairs. The claim, which we emphatically reject, will involve a protracted trial action, and the matter is only likely to conclude in several years’ time,“ said Sassoon.

Sasfin said the claim would not result in the recognition of any liability and that it has no effect on its
capital position.

Sasfin Holdings has a market capitalisation of R695m and saw its share price dive 7.11% on Tuesday to R19.98.

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