Report 69 Business Practices Committee

The Committee is of the opinion that ICSA participants would be unreasonably prejudiced. At any time the greatest majority of the participants is at risk. The relations between those participants who have not recouped their payments and the business, ICSA, will be harmed. In terms of the Act this by itself would constitute a harmful business practice.

The principles of a free market economy are not absolute they are relative. For example, the right of an individual to free market activity is counterbalanced by the right of an equally free society to curb its excesses. Some people might contend that, where informed individuals engage in a business undertaking in which a substantial number of such individuals are likely to lose their money, such loss was not unreasonably prejudicial because those individuals made a free and informed decision. The essential flaw in this contention is that the reasonableness or unreasonableness of the prejudice inherent in the practice of a business entity likely to be suffered by a substantial number is not the purview of the free individual but of the free society. What is reasonable in the perspective of the free individual is likely to be unreasonable in the perspective of free society when substantial numbers are involved. The standards of reasonableness will also depend upon the facts of each particular case, regard being had to the operational methods and controls of the business practice, the extent of disclosures in the absence of regulatory mechanisms and the accountability of its office bearers.

The Committee is of the opinion, for the reasons advanced, that the activities of ICSA constitute a harmful business practice as defined in the Act. The Committee is further of the opinion that the harmful business practice is not justified in the public interest and that the Minister should take steps in terms of Section 12(b) and (c) of the Act to prevent Venter to continue the harmful business practice.