Momentum washes its hands of N$103m insurance fraud

Local insurance giant Momentum Namibia has found itself entangled in a fraud scheme in which Petrichor Capital has lost N$103 million in client policies, allegedly through Michael Hough Bronkhorst, a former Alexander Forbes finance manager and broker for Petrichor.In 2020, Momentum Short-Term Insurance Namibia, a subsidiary of the Momentum Metropolitan Group, acquired Alexander Forbes Namibia.Petrichor Capital earlier this month secured a sequestration order from the High Court against Bronkhorst, a prominent local chartered accountant and businessman, to recover around N$103 million purportedly embezzled from clients of Momentum Namibia.Bronkhorst served as the main focal point for Petrichor Capital to secure clients for a scheme in which Petrichor enabled individuals to borrow money, using their policy with Momentum Insurance as security.According to experts, this kind of policy investment is often used to evade tax.Legal instrumentHowever, Momentum Namibia spokesperson Denille Roostee dismissed these claims, saying it was a legal business model.“As with any loan, you need to provide surety that you can repay the loan. Using a policy as a guarantee is perfectly legal and is done in various other formats. These policies are a risk management tool used by clients all over the world to make provisions for unforeseen risks,” Roostee said.The discovery of the large-scale fraud allegedly perpetrated by Bronkhorst between 3 and 4 March was prompted by an email from an underwriter notifying Petrichor that a client&#039;s withdrawal request was denied due to the policy being ceded to Petrichor as security for a N$2.5 million loan to BV Investments Eight Hundred and Eighty Six, a company owned by Bronkhorst.In a WhatsApp message that forms part of an affidavit, Heinrich Jansen van Vuuren, a former trustee of Petrichor and the man who brought the matter to court, informed Bronkhorst&#039;s lawyer, Hennie Kruger, that “the consensus is that criminal prosecution can be negotiated if all the money is paid. Momentum has a meeting tomorrow with their shareholders to discuss the situation.”No threatHowever, Roostee has vehemently denied any links between Momentum, Bronkhorst and the fraud scheme, saying they did not act as brokers for Petrichor Capital and that Momentum’s clients are completely safe.According to her, no client funds have been invested with Petrichor, and instead, Petrichor facilitated loans against clients’ policy funds.“Petrichor enables individuals to borrow money, using their policy with Momentum Insurance as security. It works like taking a loan with a bank, ceding your life insurance policy to the bank as security. In this case, the fraud was committed against Petrichor as there was no approval from the client to cede the policy as security,” she said.“Momentum Insurance does not act as a broker for Petrichor. Petrichor exclusively handles all loans directly. Momentum Insurance merely registers a cession on request from Petrichor against the client’s policy as security when applying for a loan. Any cessions obtained fraudulently have been revoked by Momentum Insurance and there is therefore no cession against a client’s policy where fraud was committed, making it an illegitimate loan,” she said.She added that it is important to note that Momentum Insurance will not incur losses unless the debentures within Petrichor default.No moneyMomentum Namibia’s position, however, is contrary to the concerns raised by Van Vuuren, who said there is a N$60 million shortfall as Bronkhorst&#039;s estate only accounts for N$38 million and that it is clear that he would not be able to pay the money back.Van Vuuren told the court that Bronkhorst asked Petrichor to lend him the money to enable him to repay Petrichor.“It soon became clear to me that he would not be able to pay the money owing. In fact, to our shock and horror, he even suggested that Petrichor will have to lend or provide capital to him to enable him to repay Petrichor,” Van Vuuren said in his affidavit.jemima@namibiansun.com

Momentum washes its hands of N$103m insurance fraud

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Namibian Sun 2025-05-02

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Momentum washes its hands of N$103m insurance fraud

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Namibian Sun 2025-05-02

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