Letter from Old Saints to the Old Stithian Association (OSA) Committee
Re. BHI Trust

We note the BHI Trust financial scandal with deep concern. This impacts the school, the OSA, alumni and the broader community.

The pertinent information, as we currently understand it:

• The OSA has held an investment in BHI Trust for a number of years.
• BHI Trust is the vehicle used by Craig Warriner to run what he has admitted was a Ponzi scheme - https://mg.co.za/news/2023-11-10-bhi-trusts-r2-7-billion-financial-scandal-hits-investors-hard/ 
• The sum invested increased in recent years.
• In the ‘Notes to Financial Statements’ of the annual financial statements dated 31 December 2022, under ‘Managed funds’, there is a line item for ‘Funds managed by BHI Trust’ to the tune of R2,134,369. That figure is listed as R1,152,309 in 2021. In the OSA annual financial statements for 31 December 2021, we have the 2021 figure confirmed and see a 2020 figure of R1,129,908.
• The latest figure of just over R2 million is approximately a quarter of the total assets of the OSA.
• It is likely that this money has been irretrievably lost.
• Warriner is (or at least was during the time of the investment in his fund) an OSA member.
• Warriner is an erstwhile long-time chairman of the OSA.
• Warriner has made large financial donations to St. Stithians in the past. [It is unclear whether he made donations to the OSA directly.] 
• The OSA financial accounts appear to have been reviewed and signed off by a current OSA member who has held - and perhaps continues to hold - voluntary leadership roles in the school structure (OSA to confirm). 

OSA letter to members 6 November 2023:
The letter was marked "confidential and not for distribution". We are unsure why. However, we will abide by this and refrain from publishing the letter here. 

We endorse portions of the recent OSA letter to alumni. We note with approval that the OSA is in favour of a full investigation and is prepared to enforce the code of conduct where necessary. 

However, we cannot endorse the apparent intention that the current OSA leadership will manage this process. This would amount to “marking one’s own homework”. We have lost confidence in current leadership.

Regardless of the outcome of any investigations, the following are clear breaches of the most basic rules governance:

• Investing with a current member.
• Investing with an erstwhile long-time chairman.
• Investing with a donor to the school.
• Having financial statements reviewed by a current member (on which we await confirmation from the OSA).

We call for the following steps:

• The OSA chairman should step down and commit to assisting with investigations.
• The OSA treasurer should step down and commit to assisting with investigations.
• Any committee member involved in due diligence and investing should step down.
• All committee members should declare personal relationships and financial interests with Craig Warriner and BHI Trust.
• A temporary task team should be established to conduct the investigation. This should be composed of current OSA committee members who have not been involved in any decisions to invest in BHI, as well as independent participants, including both OSA members and independent parties.
• Names of members of this task team should be disclosed.
• The lawyers currently being used by the OSA should be disclosed.
• All meeting notes relevant to investing decisions should be disclosed.
• An investigation timeline and project plan should be drawn up and published.
• OSA members should be informed on the progress of the investigation on a weekly basis.

Some initial questions that must be addressed by the investigation: 

1. Who was part of the initial decision to invest in BHI? 
2. Who was part of any subsequent decision to maintain or increase this investment? 
3. For each person identified above, what relationship existed with Warriner and BHI? 
4. Was any money invested with Warriner and/or BHI during Warriner's time as OSA chairman? 
5. Were the accounts reviewed by a current OSA member? If so, what other roles does he have, or has he had, in the broader St. Stithians structure? 
6. Has Warriner or BHI ever donated directly to the OSA? 
7. Has the OSA ever benefited from a donation made by Warriner or BHI to an associated entity (especially the school itself)? 
8. Which parts of OSA governing documentation allowed for the failings identified above? 

We invite all Saints alumni who endorse these steps to sign this letter. Please provide your name and the year in which you matriculated or left Saints.

Notes and resources:

- An OSA committee member has responded to a draft of this letter:

"We will be sure to table this for discussion at an urgent committee meeting which is being held on Wednesday." (message sent 13 November 2023)

It seems that this meeting has taken place. No further information has been disclosed. 

- Draft copy of OSA financial statements 31 December 2022: https://drive.google.com/file/d/1A99xD559nrJJwbUZh97FRxpcNbnmuwpD/view 

 

 

 

 

 

 

- Letter from the St. Stithians rector regarding this matter: https://drive.google.com/file/d/1qH8ObeH4k4xj__PyY

 

 

 

 

 

 

 

 

- OSA letter to alumni dated 19 November 2023

 

 

 

 

 

 

 

 

- Relevant media articles on the matter:

https://www.biznews.com/sa-investing/2023/10/31/bhi-ponzi-warriners-trust-sequestrated 
https://www.news24.com/fin24/companies/joburg-investment-fund-fears-bhis-new-trustees-on-hunt-for-missing-money-20231107
https://mybroadband.co.za/news/investing/513877-how-i-lost-r6-million-in-massive-south-african-ponzi-scheme-investor-explains-how-he-was-tricked.html
https://www.moneyweb.co.za/news/south-africa/theres-almost-nothing-left-in-the-bhi-bank-account/
https://www.businesslive.co.za/fm/opinion/editors-note/2023-11-02-rob-rose-craig-roy-warriner-and-the-abuse-of-trust/ 

Contact: Ian Macleod - ian.duncan.macleod@gmail.com

Ends.