The State v Hildegard Antionette Pieterse: A landmark case on large-scale corporate theft.
Regional Magistrate Venter, sitting at the Special Commercial Crimes Court (SCCC) in Palm Ridge, Johannesburg, delivered judgment on sentencing in case of The State against Hildegard Antionette Pieterse (née Steenkamp).
Background and charges brought
Mrs Pieterse pleaded guilty to counts one to 336, corresponding to first alternative counts of theft. Specific counts – 4, 12, 14, 16, 17, 23, 25-143,145-271, 290, 291, 306, 308-320, 322-336 – were considered under the provisions of section 51(2) of the Criminal Law Amendment Act 105 of 1997.
Employed by Medtronic Africa (Pty) Ltd (Medtronic) from 1 September 2004 to 31 May 2017 as a bookkeeper, Mrs Pieterse’s duties included processing company creditor payments. During this period, she was married to Mr Matthys Steenkamp (now deceased). Mrs Pieterse executed unauthorised transactions by misrepresenting them as legitimate creditor payments to clearing agents. These payments were transferred from Medtronic’s Standard Bank account to the ABSA account held by her and her husband. To conceal the misappropriation, she submitted fraudulent VAT claims to SARS, resulting in substantial refunds to Medtronic. Neither Mr Steenkamp nor Mrs Pieterse were entitled to these funds, which were used for their personal benefit.
Sentencing determination
Magistrate Venter began his sentencing judgment by considering the various principles of sentencing: namely that the object of sentencing is not to satisfy public opinion but to serve public interest, that the court must consider the triad consisting of the offender, the crime, and the interest of society, that the court has to apply its discretion on sentencing and find a way to harmonise punishment and mercy, in balancing the main purposes of punishment, being deterrence, prevention, reformation, and retribution.
In order to determine a just sentence, the court considered the personal circumstances of the accused, who had elected to testify in mitigation of the sentence. Looking at the surrounding circumstances, it was noted that it had taken five and a half years before Mrs Pieterse entered her guilty plea. In her favour, it was accepted that at least she took to the witness stand to testify in mitigation, which allowed her to intimate to the court why she committed the crimes as well as provide insight into her person. As was seen from her evidence, she started by portraying herself to be a victim of domestic abuse, who committed these offences out of need to rescue his business and for fear of her husband. She claimed that although she was doing the stealing, her husband took control of the loot and only gave her scraps. As cross-examination progressed all this turned out to be untrue. State counsel managed to show that Mrs Pieterse spent far more than what she initially portrayed. She ultimately conceded she was in control and stole to support her luxury lifestyle. This continued even after her husband was no longer in any position to make the demands that she initially wanted the court to believe. It became clear that Mrs Pieterse had misled the court and this deception undermined her credibility.
Mrs Pieterse was released on bail on 15 December 2017, so she was not subjected to a significant period of incarceration awaiting trial, which would have any impact on the sentence consideration. She did not report any ill health concerns, and she stood before the court as a first-time offender, being 49 years of age. She had pleaded guilty, with the defence submitting this to be seen as a sign of remorse.
It was further noted that the seriousness of gender-based violence can never be understated, but this did not allow for it to be used as an excuse for the wrong reasons which turns the victim into the abuser. By lying about being in such a relationship, Mrs Pieterse desensitised the public to the plight of the vulnerable who are genuinely captured in such an abuse cycle. She had not produced one bit of evidence supporting her alleged abusive relationship. As a result, her credibility was in ashes. The court went on to state that the only reasonable inference to draw was that Mrs Pieterse displayed a dishonest nature. She had only her own interests at heart. She displayed no genuine remorse. She had a severe lack of penitence. Her guilty plea could not be seen as an act of remorse. She pleaded guilty because of the overwhelmingly strong and unarguable case against her. She lacked true appreciation of the consequences of her actions. The lack of remorse was not an aggravating factor on its own but rather showed a poor prognosis towards rehabilitation.
Turning to the offence, the court noted that fraud and theft are without doubt serious and their essence was that of dishonesty. Mrs Pieterse’s actions showed preplanning and premeditation. As a bookkeeper, she was in a position of trust no doubt and abused this trust when she saw that she could get away with it. When a bookkeeper discovered a loophole which could prejudice the employer, he or she was supposed to report it so that measures could be put into place to prevent it. Instead, Mrs Pieterse capitalised on it for own benefit.
Turning to the interests of society, the court noted that society demanded the punishment of offenders. Imposing sentences which suited the personal circumstances of the offender only would invite other acts of white-collar crime to be committed. The status of the defrauded company was thus considered, and the impact the offences had had on it. Because of the accused’s offences, SARS had held the company responsible for the repayment of VAT, which left the company with an out-of-pocket expense of around R770 million, considering the cost of forensic investigation, litigation, and SARS penalties.
The court proceeded to deal with the application of the Criminal Law Amendment Act 105 of 1997 for 283 of the counts raised against the accused, falling within the provisions of section 51(2). Fraud involving amounts of more than R500 000.00 or more than R100 000.00 with perpetrators acting in common purpose, fall within the Part II, Schedule 2 listed offences. Section 51(2)(a)(i) prescribes a minimum sentence of 15 years’ imprisonment for first-time offenders. In terms of section 51(3)(a) the court was to impose this prescribed sentence unless there are substantial and compelling circumstances which would justify the imposition of a lesser sentence.
After thorough consideration, the court found no exceptional circumstances warranting deviation from the prescribed sentences. Case law indicates that the misappropriated amount significantly influences the term of imprisonment.
Conclusion
In light of this, Magistrate Venter went on to group various counts based on the amounts misappropriated in each count, and concluded that the court was of the view that the following sentence was just:
- Group 2 Counts: 90 counts, each between R100 000.00 and R1 million, totalling R33 320 560.36. Sentenced to 15 years’ imprisonment, served concurrently.
- Group 3 Counts: 50 counts, each between R1 million and R2 million, totalling R80 787 642.52. Sentenced to 15 years’ imprisonment, served concurrently. Each group 2 and 3 count individually carried an imprisonment term of 15 years, which would have totalled 2 100 years if not ordered concurrently.
- Group 1 Counts: 53 counts, each less than R100 000.00, totalling R2 326 458.22. Sentenced to 15 years’ imprisonment, served concurrently with Groups 2 and 3.
- Group 4 Counts: 122 counts, each between R2 million and R3 million, totalling R326 626 537.58. Sentenced to 20 years’ imprisonment, served concurrently. Each group 4 count individually carried an imprisonment term of up to 20 years, which would have totalled 2 440 years if not ordered concurrently.
- Group 5 Counts: 3 counts, each between R3 million and R4 million, totalling R10 086 592.92. Sentenced to 15 years’ imprisonment, served concurrently.
- Group 6 Counts: 15 counts, each between R4 million and R6 million, totalling R70 640 628.80. Sentenced to 15 years’ imprisonment, served concurrently.
- Group 7 Counts: 2 counts, each exceeding R6 million, totalling R13 429 406.41. Sentenced to 15 years’ imprisonment, served concurrently. Each group 5, 6, and 7 count individually carried an imprisonment term of 15 years, which would have totalled 300 years if not ordered concurrently.
Therefore, in the court’s best effort to mitigate the 4 870 years of sentence by applying mercy and considering the cumulative effect of sentencing, the final sentence imposed was an effective 50 years of imprisonment, with no fixed non-parole period.