After a two-year investigation, the Financial Sector Conduct Authority (FSCA)has cleared crowd-farming and investment platform Livestock Wealth of any wrongdoing.
By Lebogang Mashala, editor at African Farming
The company has welcomed the conclusion of the investigation, which began in January 2024 following a widely publicised FSCA press release issued on 24 January 2024. In that statement, the regulator cautioned the public against dealing with Livestock Wealth (Pty) Ltd and its subsidiary, Livestock Wealth Financial Services (Pty) Ltd (Livestock FS).
According to Livestock Wealth marketing manager Sibongile Shezi, the FSCA alleged at the time that the company was not authorised to render financial services in terms of the Financial Advisory and Intermediary Services Act, 2002 (FAIS Act).
“It has come to the attention of the FSCA that Livestock Wealth may be unlawfully offering members of the public investment into livestock and/or agricultural product(s), offering profitable returns upon maturity,” the FSCA said in its January 2024 statement.
The regulator further expressed concern that Livestock Wealth had displayed Livestock FS’s financial services provider (FSP) number on its website, prompting a formal investigation.
Founded in 2015, Livestock Wealth grew to manage agricultural assets valued at more than R100 million, including cattle, macadamia orchards and citrus farmland. Its citrus operations exported about 75 000 cartons, generating R15 million in revenue and creating approximately 200 jobs.
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Negative Publicity
“The press release caused considerable negative publicity and created anxiety among the public, our farming partners, investors and staff,” Sibongile said.
She said the company was relieved that the investigation and detailed analysis of its business model confirmed that Livestock Wealth’s sale of agricultural products did not contravene the FAIS Act, as initially suggested.
“Throughout the investigation, Livestock Wealth cooperated fully with the FSCA, responding promptly to all information requests. The FSCA conducted a thorough review of our financial records and analysed every transaction on our platform,” she said.
Sibongile added that the negative publicity created the perception that the company was operating a Ponzi-type scheme.
“We made full disclosure to the FSCA about our financial systems, including our bank accounts, and accounted for every transaction involving investor funds. The investigation found no unlawful activity, no misappropriation of investor funds, and confirmed that all funds were properly accounted for,” she said.
Livestock Wealth also submitted evidence showing the display of the subsidiary’s FSP number aligned with the business plan approved by the FSCA in October 2021, when the licence was granted. However, the regulator still imposed an administrative penalty of R50 000 on Livestock Wealth and a further R50 000 on its chief executive, Ntuthuko Shezi, relating specifically to the display of the FSP number on the company’s website.
“Despite our continued belief that we acted in line with the approved business plan, we chose not to appeal the ruling at the Financial Services Tribunal and paid the fines in full,” Sibongile said.
Rebuilding Trust
She said the company’s focus is now on rebuilding trust, strengthening its market presence and continuing to deliver value to stakeholders.
“The past 24 months have been among the most challenging in our journey, as we operated under a cloud of public scrutiny. We sincerely thank our bankers, investors, farmers, partners and staff for their resilience and continued support,” she said.
With the investigation concluded, Livestock Wealth says it is entering a new chapter with renewed focus.
“Our mission to end inequality and transform access to investment, particularly in agriculture, remains central to our work. We are committed to building a stronger future for all who journey with us,” Sibongile said.
Also read: Striking gold with macadamias
