Arrests made linked to St Francis yacht-building business

Two more people have been arrested in connection with St Francis Bay luxury yacht company, Tag Yachts.

A string of investors were left without their luxury catamarans.

The men are expected to appear in the Port Elizabeth Commercial Crimes Court on Tuesday morning, and according to the Herald Live they face charges of reckless trading and fraud.

The directors of the firm allegedly spent millions of rand meant for the building of luxury catamarans while clients paid for yachts they never received.

The new arrests come after the company’s bookkeeper admitted to stealing R3m from the company. She fraudulently substituted the banking details of Tag’s creditors and suppliers with her own, according to the Herald Live.

The company started to unravel when, according to director Tim van der Steene “things took longer than expected and when key parties changed the business plan. This caused a snowball effect which the company could not sustain,” according to Boating South Africa.

Newspaper reports name one investor as Sultan Ahmed Ghunoum Al-Hameli. Seemingly he came on board as both client and investor, and paid an initial deposit of around R200,000 for a Tag 50.

Van der Steene says that this was the Sultan’s initial deposit to secure a build slot after meeting him at the Cannes Boat Show. A Weekend Post report also named three other clients – an Australian couple, an Argentine businessman, and a Swiss private equity adviser who all allegedly paid deposits.

Within months of money reaching the Tag 50 bank accounts, money was being used towards overseas trips, alcohol, unauthorised salaries, restaurants, an alleged charity event at a golf club, and even a bicycle, according to the Weekend Post.

Reportedly, Van der Steene says: “They all cancelled their contracts with Tag Yachts when the business went into rescue and took matters into their own hands,” but “two yachts were finished by the clients re-contracting ex-Tag Staff.”