Panel Beater De Luxe
Noseweek|September 2020
Danmar Autobody and its erstwhile directors get a serious panel beating in court papers. Corruption and theft are said to have destroyed the firm chaired by Nelson Mandela’s eldest daughter, leaving 200 workers destitute and threatening to kill.

DANMAR CEO HOWARD BLOOMBERG : Said to have lived it up on the company credit card to the tune of R18.5 million

BusIness rescue prActItIoners of well-known Gauteng panel beating company Danmar Autobody claim criminal mismanagement, fraud, theft and tax evasion by the CEO and majority shareholder have seen the company put into business rescue and headed for liquidation.

Former President Nelson Mandela’s eldest daughter, Makaziwe MandelaAmuah owns a 26% stake in the company. CEO Howard Bloomberg owns 54%, and Colin Yach, a chartered accountant who worked for Blue Label Telecoms before joining Danmar, owns the remaining 20%.

Bloomberg and Yach have been accused of having used Mandela as a “BEE front”.

Danmar Autobody was for several decades recognised as the panel beating business on the Reef favored by the likes of Mercedes Benz and various major vehicle insurers.

From March 2019 to January 2020, Bloomberg drew R700,500 in cash from the Danmar bank account at ATMs at local casinos

Danmar’s downward spiral appeared to have started in 2017 when Bloomberg, Mandela-Amuah and Yach bought the business – and some branches gained from Imperial Holdings – for R20m, according to the business rescue practitioners who took control of the company in February this year.

Danmar’s employees have been left without an income since December, and its many creditors are seriously out of pocket.

Soon after it went into business rescue (on 24 January), its major client Mercedes Benz and various insurers cut ties with the company. Founded in 1989, Danmar had four branches in Gauteng and one in Cape Town and employed over 200 people.

The business rescue practitioners appointed in February are Harold Cesman and Kobus Coetzee.

When they got to look at the books, they discovered what they believe to be sham deductions from the salaries of the 228 employees.

They also discovered that Bloomberg “appeared to have engaged in theft” by his “apparent misappropriation” of R18.5 million of company money for his own use between May 2017 and January 2020. It was “reckless, grossly negligent and even fraudulent” for Bloomberg to have taken this money, Cesman has declared in an affidavit filed in the high court in Johannesburg on 1 May.

The court papers are replete with such damning accusations – and counter-accusations traded between the business rescue practitioners and Bloomberg, who, in his answering papers filed on 11 May, denies – amongst other things – that he misappropriated the R18.5 million.

He claims that he hadn’t drawn a salary and that Danmar owed him R18 million.

If the withdrawals were indeed Bloomberg’s salary, the company accounts would have reflected this – but did not, Cesman declared in response. The way Bloomberg apparently claimed his salary could “constitute tax evasion”.

Cesman further alleged it appeared that Bloomberg had not only used company money to fund his lifestyle; he appeared also to have used it to capitalise another business, Closeprops 2001 CC.

In response, Bloomberg claimed that the payments to Closeprops were legitimate, as these were for the repayment of loans he had made to Danmar.

Next, Cesman alleges that Bloomberg secretly instructed Danmar employee Matwale Paile to deposit cash of between R50,000 and R150,000 into Bloomberg’s Mercantile Bank account every month from 2017 to 2019. Paile confirms this in a supporting affidavit signed in February this year.

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