THE near simultaneous collapse of Alliance Mining and African Dawn three years ago followed what may have been one of the most brazen acts of corporate fraud in South Africa’s history.

Yet those involved have faced absolutely no consequences.

The two firms had a couple of things in common — the same financial director, one Connie van Nieuwkerk, a number of audit staff, and, for a while, the same audit firm. They also had in common the habit of paying large bonuses to certain managers.

African Dawn was involved in microlending and other forms of financial services, while Alliance was in mining services.

But when the two companies collapsed, following new auditors’ complaints to the JSE that they were being forced to break the rules, their financial affairs turned out to be a complete fiction.

Shareholders and other creditors lost nearly everything; each company had a market cap around R1bn at their 2008 peaks. Things turned very nasty indeed — one of the auditors who exposed the rot received death threats. African Dawn is operating under new management, which has attempted to rescue it, but Alliance Mining is being liquidated.

At the time they collapsed there were promises of all sorts of consequences for those involved.

The Industrial Development Corporation (IDC) was especially embarrassed as it had just lent Alliance Mining R120m. At the time it was suggested that chairman Matthews Phosa had played a key role in obtaining the IDC loan. Mr Phosa, who is also the African National Congress treasurer, was Alliance’s empowerment shareholder and it appeared the IDC did not follow proper process in making the loans.

I have been informed that a major corporate law firm was appointed by the IDC to investigate what went wrong at Alliance. I know that audit firm Grant Thornton was appointed to conduct a forensic investigation into African Dawn. But as for what happened to those reports, your guess is as good as mine.

I have been told they landed on the desk of the National Prosecuting Authority’s (NPA’s) serious commercial crimes unit, complete with strong prima facie evidence of fraud and other wrongdoings.

But when I inquired with senior prosecutors at the NPA, there were vague comments to the extent that the issue had "gone dead".

I suspect that the continued suspension of Glynnis Breytenbach and her battle with the NPA has seriously undermined the effectiveness of the white-collar crime prosecuting unit. She had headed it and was the only person there with a record of successful commercial crime prosecutions.

I also called up contacts at the South African Institute of Chartered Accountants and the Independent Regulatory Board for Auditors to see if they had disciplined any of their members who had been involved. I couldn’t get a straight answer from either. Mysteriously, neither routinely publishes the names of those auditors and accountants who are debarred, making for a rather light form of discipline if indeed it is ever meted out.

The Alliance Mining and African Dawn reports also, I am told by another source, were handed over to the Financial Services Board, which can in theory prosecute for misrepresentations to shareholders. Nothing has yet come of that either.

It all points, in my mind, to a serious lack of prosecutorial ambition when it comes to white-collar crime in South Africa. When I ask the powers that be why so little has been done, the answer is often a lack of resources. Commercial crime can be very complex and requires advanced skill to investigate and prosecute. But in both these cases the work had largely been done through the forensic investigations and reports of professional firms.

Blue Financial Services, which nearly collapsed in 2009, is another where I have heard of investigations that have not yet delivered anything, despite some clear evidence that management lied to investors. Golf course developer Pinnacle Point also collapsed in 2009, in that case mysteriously taking hundreds of millions of union money with it.

I wonder whose interests are served by de-clawing the NPA and other white-collar crime investigators. Could the steady erosion of the capability of prosecutors to turn against their political overseers have produced a free-for-all for white-collar criminals?