Neil Diamond vs Sunday Times

Complainant: Neil Diamond

Lodged by: Andrew Boerner

Article: ANC councillor in theft probe – Businessman accused of taking cash from dead partner’s estate

Author of article:  Werner Swart

Date: 7 April 2013

Respondent: Sunday Times

This ruling is based on the written submissions of Mr Andrew Boerner (from Jurgens Bekker Attorneys), for Mr Neil Diamond, and the Sunday Times newspaper, as well as on an informal hearing that was held at our offices on 27 March 2013. This meeting was attended by Boerner, while Susan Smuts represented the newspaper.

COMPLAINT

Mr Neil Diamond (a businessman, an Ekurhuleni ANC councillor, and the chairman of the municipality’s finance portfolio committee) complains about a story on page 12 in Sunday Times on 9 December 2012 and headlined ANC councillor in theft probe – Businessman accused of taking cash from dead partner’s estate.

He complains that the following statements in the story were factually incorrect, namely that:

·         a case of theft, forgery and uttering against him was opened (at the Alberton Police Station);

·         a trust account was set up for Ms Annelien van der Walt (a widow) and her three children and that some withdrawals made from this account were transferred into a company of which he was the sole shareholder (Sonex); and

·         a forensic audit was compiled (which implicated him in crimes).

Diamond adds that the following statements were false and out of context:

·         A council investigation found that he had transgressed council policy regarding the controversial land swap deal in Meyersdal (south of Johannesburg); and

·         He was “targeting” a forensic consultant, Mr Paul O’Sullivan.

He also complains that the:

·         reporter failed to ask him for comment on relevant issues and unverified allegations; and

·         headline was misleading.

ANALYSIS

The story, written by Werner Swart, said that Diamond stood accused of pilfering his dead friend’s estate (Mr Jannie van der Walt) of R5.5-million. He reported that a case of theft, forgery and uttering was opened at the Alberton police station. The article stated: “It comes after the widow of a former friend, Jannie van der Walt, appointed forensic consultants (Mr Paul O’Sullivan) to probe her late husband’s estate, including a trust account set up for her and their three children. A forensic audit (conducted by Ms Melissa Naidu, a forensic consultant at Paul O’Sullivan & Associates) found that Diamond had allegedly unlawfully withdrawn over R5.5-million from the estate.” Swart also reported that Diamond had obtained an interdict against O’Sullivan and Ms van der Walt to restrain them from threatening, harassing, intimidating or abusing Diamond.

Case opened against Diamond

The story said: “This week, a case of theft, forgery and uttering was opened at the Alberton Police Station against Neil Diamond…”

Diamond complains that the story incorrectly stated as fact that such a case was opened:

·         during the week of 3 to 9 December 2012, as the case was only registered on the SAPS system on December 10; and

·         against him  – he says that he was not listed as a suspect when the docket was opened and that he was only included as a person of interest on the docket on December 11.

He argues that the story therefore damaged his dignity and reputation.

Sunday Times disagrees, saying that the case was set in motion at the Alberton Police Station on December 6 when Naidu’s statement was filed. This document named Diamond and dealt in detail with the allegations against him. The newspaper says that the next day Police spokesman Brigadier Neville Malila confirmed that the matter was being investigated.

However, Diamond argues that:

·         Naidu’s statement was illegal, as the copies of the police docket had been typed out – “this is in breach of standard procedure as the docket is filled out in a police station” (he adds that it is illegal to have such documents on word format);

·         there was no stamp on the document; and

·         there was no CAS number on the document.

Diamond reiterates that there are no criminal charges against him, neither has he been arrested – yet the story reported the sentence in dispute.

Boerner, for Diamond, quotes a ruling in a court case between Independent Newspapers Holdings Ltd and others vs. Suliman (28 May 2004) as follows:

“Defamation is of course an injuria to one’s fama or reputation. I think that it is inevitable that some damage is done to the reputation of a person when the public is told, before a decision to charge him with a serious crime has been taken and before he has appeared in court, that he is under arrest on suspicion of committing that crime…

“The harsh reality…is that even mere suspicion, to put it at its lowest, raises doubts in the mind of those to whom it is communicated as to whether the hitherto unsullied reputation which the person enjoyed continues to be deserved or whether it should now be regarded as undeserved.

“To say that which imperils the continued existence of a person’s good reputation and causes people generally to doubt the integrity of that person even though they may not be certain the doubt is justified, is to adversely affect to at least some degree his or her reputation. That the doubt may be temporary and ultimately transient because of the subsequently established innocence of the person concerned cannot cure the loss of esteem which that person endures pending the establishment of his or her innocence.”

At the meeting, the newspaper insisted that Malila – a “credible source” – confirmed that this case had been opened, and therefore argued that it had been justified in its reportage.

Both parties informed me that it would not be possible to obtain the necessary documentation from the Police at this stage. This left me with no way of verifying the information in dispute.

I have no reason to disbelieve the newspaper’s testimony, which means that I accept that it was indeed justified in its reportage. However, this does not mean that I also take it that Malila’s information was correct.

See the text under “General comment” at the end of the “Finding”.

Trust account; sole shareholder

The story stated that Ms van der Walt appointed forensic consultants to probe her late husband’s estate, “including a trust account set up for her and their three children”. It also said: “The audit report (by DVM Auditors) seen by the Sunday Times shows large withdrawals were made from the estate’s trust account, some of which were transferred into a company of which Diamond is the sole shareholder (Sonex). The report concluded that there was also a conflict of interest, as Diamond, while executor of the estate, made payments to his own company.”

Diamond complains that no such trust account existed; he says that there was “an  that was a current account”. He also denies that he was the sole shareholder in a company (to which transfers were made). He explains that the will stated that the residue of the estate would be placed into a trust, which would only occur after all assets and property have been distributed.

I note that he does not complain that the story stated that some payments were made to Sonex.

At the meeting, the Sunday Times conceded that it used the wrong terminology regarding the trust account, but argued that this was not of material importance.

The newspaper also refers me to Section 3.5 of van der Walt’s will, which stated that he wished his wife and children, once they reach the age of 21, would be trustees of a trust which was to be established after his death.  (This document was in Afrikaans, and the relevant part read that a trust had to be established “by my afsterwe” – which means immediately after his death.)

Secondly, Sunday Times also draws my attention to various findings regarding Sonex in Naidu’s statement, amongst others that Diamond became the 100% shareholder of the company the day before van der Walt’s death. Her finding also referred to expenses claimed from the estate by Sonex. “The auditor said the claims should not have been claimed at all, and were paid without authorization from the Master of the court.”

The newspaper maintains that it acted reasonably by properly attributing the source of the information to the statement.

In later correspondence, Boerner says that Naidu relied upon the report by DVM Auditors, and notes: “The auditors have subsequently withdrawn their reports and have stated that the reports cannot be relied upon. Thus the statement by Ms. Naidu is unsupported and of no standing. This has taken place after the publication, however this clearly indicates the disputed nature of Ms. Naidu’s statement.”

He also refers this office to an “extract of opinion” by Senior Counsel Bosman, in which he stated that Diamond owned 50% of Sonex.

These are my considerations:

Trust account

While the use of the words “trust account” was incorrect, the ordinary reader would probably not have understood the difference between payments from an “estate late account” and payments from a “trust account” – which means that the incorrect use of the latter term was not likely to cause Diamond unnecessarily harm.

Sole shareholder

The newspaper relied on Naidu’s document – which it was justified to do at the time of publication. This does not necessarily mean that her information about Diamond being the sole owner of Sonex is correct. I also note that the story attributed this information to Naidu’s report and did not state it as fact. Again, this does not mean that the information is correct – only that the newspaper was justified to report it with the data at its disposal.

Naidu’s report withdrawn

It is a fact that DVM Auditors did withdraw Naidu’s report. However, at the meeting the newspaper said that O’Sullivan did not accept this withdrawal. I also take into account that her report was withdrawn after the publication of the story – which justified the newspaper to use it as a source at the time of publication.

See the text under “General comment” at the end of the “Finding”.

Forensic audit

The sentence in dispute read: “A forensic audit found that … (Diamond had allegedly unlawfully withdrawn over R5.5-million from the estate).”

Diamond says that the so-called forensic audit was conducted by a private investigator with no forensic audit qualification. This “auditor”, he argues, was not endorsed by the professional body for Forensic Auditors and Audit Professionals and Practitioners. He concludes that the mentioning of the words “a forensic audit” was therefore incorrect.

The newspaper says that it accepts that the audit was not a forensic one and that it is willing to correct this.

Diamond replies that Naidu’s report was neither a forensic audit nor an audited report. He asks this office to find that the newspaper’s information obtained “was nothing more than unverified allegations” compiled by Naidu.

He also argues that, as the report was not a forensic audit report, her statement was therefore also factually incorrect.

Whether Naidu’s document can be called an audit report or merely an investigation, the fact remains that the use of the term “forensic audit” was wrong. However, it is not for this office to establish whether or not Naidu’s report contained merely “unverified allegations” – we are not an audit firm. Besides, at the time of publication her report was still official and newsworthy.

In this case, though, Diamond could have been caused unnecessary harm, as a “forensic” audit certainly gave credibility to the allegations in the report/investigation.

Transgressing council policy: Meyersdal

The story read: “Diamond made headlines in a controversial land-swap deal in Meyersdal, south of Johannesburg, several years ago with an upmarket property development in which he held shares and acted as a marketing agent – despite serving on the council. An investigation by the council found that he had transgressed council policy. However, Diamond was never charged.”

Diamond says the statement that he had transgressed council policy was factually incorrect as the Nupen report cleared him from any wrong-doing in the Meyersdal land swap deal (the Ekurhuleni Metropolitan Council adopted this report in 2010). He also argues that while it is true that he made “headlines” some time ago, the fact that he was cleared from any wrong-doing should have been mentioned – failing which the reporter omitted the proper context (he refers me to a finding by this office regarding a similar complaint against a different newspaper).

Sunday Times says that its reference to the Meyersal property was fair. The newspaper refers me to another ruling by this office in which we found that the Nupen report stated that Diamond was guilty of two allegations. “We submit that our reporting falls safely within the ambit of the latter ruling”.

This is the situation: In the finding that Diamond refers to, this office stated that he was “greatly” exonerated – which surely implies that he was not “fully” exonerated; this conviction was also expressed in the finding that the newspaper mentions.

I therefore conclude that, while the disputed sentences are true (he had partly transgressed council policy, as the newspaper correctly argues), they do not reflect the whole picture (as he had been greatly exonerated). This is a classic example of text that is correct, but context that is lacking.

It clearly did not suit the journalist to portray the whole picture. There is little doubt that this has caused Diamond unnecessary harm.

‘Targeting’ O’Sullivan

The story said that Diamond was “targeting” O’Sullivan.

Diamond complains that this statement was both incorrect and out of context. He says that he brought an urgent High Court application to restrain O’Sullivan from intimidating, threatening and harassing him after the latter had threatened him with arrest. He argues that he brought this application prior to the criminal matter “and therefore the allegation that he is targeting Mr. O’Sullivan is inaccurate and out of context”.

Sunday Times says that the story as a whole properly reflected that there had been a heated confrontation between the two men which resulted in Diamond obtaining an interdict against O’Sullivan. “We deny that the words are sensational. We submit instead that they are intended to convey the sense that the matter has taken on tones of personal animosity instead of dealing with the cold facts of the allegations.”

Diamond responds that he was entitled to protect his interests and be free from intimidation. He adds that the opposite was rather true, namely that O’Sullivan had instead targeted him.

The newspaper’s argument in this case is credible.

It is true that the story did not use the word “targeting” when describing O’Sullivan’s reactions to Diamond – but the sentiment was certainly there. Therefore, there is no imbalance on this issue.

Not asked for comment on relevant issues

Diamond complains that Swart did not provide him with a reasonable right of reply. He says that the reporter stated that he was calling with regard to the restraint order, and that he therefore only responded to that issue. He adds that Swart failed to ask him any questions relating to a forensic audit report; to charges of criminal investigation, theft, forgery and uttering; or to the Meyersdal land swap deal. He concludes that he was not provided with an opportunity to comment on these unverified allegations.

Sunday Times says that its reporter spoke to Diamond on December 5 and 6 regarding the interdict. “At that stage, we were unaware of the police case. However, the allegation that Mr Diamond stole from Mr van der Walt’s estate had emerged during the interdict proceedings. Our reporter asked Mr Diamond to comment on the allegation and his denial was reflected in the story.”

The newspaper says that Swart then afterwards (unsuccessfully) tried to get hold of Diamond, after which he contacted the latter’s attorney, Mr Eddie Classen (who told him that he was unaware of the case). The latter’s comments were also published.

It adds that it was not necessary to obtain comment on the Meyersdal issue, as it did not go into any contested detail or offer any fresh information on it.

Diamond retorts that he never received any urgent message from the Sunday Times and denies being unavailable on his cellphone (which he says was on international roaming).

I note that:

·         the story said: “This week Diamond denied any wrongdoing, saying: ‘I was appointed as executor, as this is what was 100% in [Van der Walt’s] will, and I am certain I did nothing wrong’.”;

·         although Diamond was not quoted on all the issues that he complains about, I accept that the story did reflect his general denial – and that the journalist indeed asked for his comment on the relevant issues;

·         it was indeed not necessary for the newspaper to have asked Diamond about Meyersdal (as stated above); and

·         the newspaper  provided me with a recording that proved that the journalist tried at least two times to get hold of Diamond in connection with the alleged charges against him.

Headline misleading

The headline read: ANC councillor in theft probe – Businessman accused of taking cash from dead partner’s estate.

Diamond says that the story itself related to alleged theft etc. against him in his capacity as a businessman, and not as an ANC councillor. Therefore, the headline “would lead the reasonable reader to deduce that the allegations of theft, forgery and uttering relate to his position as…an ANC Councillor” (which it did not). He adds that the story was published one week before the ANC Mangaung Conference and that the headline tried to discredit him both politically and personally.

The Sunday Times responds that while Diamond may wish to compartmentalize his various roles, “there is no reason for us to do the same”. The newspaper argues that as a businessman and a councillor, there is public interest in scrutinizing his character and practices. It also points out that the sub-headline referred to him as a businessman

Diamond has no leg to stand on in this instance. When, for example, a well-known sportsman has been unfaithful to his wife – that has nothing to do with his sport – publications normally link that to his sport. There are countless such examples.

Besides, the headline and the sub-headline balance these two aspects out – it used the words “ANC councillor” as well as “businessman”.

FINDING

Case opened against Diamond

This part of the complaint is dismissed.

Trust account; sole shareholder

The use of the term “trust account” was inaccurate (it should have read “estate late account”) and therefore in breach of Art. 1.1 of the Press Code that states: “The press shall be obliged to report news…accurately…”

However, the ordinary reader was not likely to have understood the difference between payments made from a trust account and those made from an estate late account – and therefore the incorrect use of the term was not likely to cause Diamond unnecessarily harm.

The complaint about Diamond being the sole owner of Solex is dismissed.

Forensic audit

The use of the term “forensic audit” was inaccurate and unfair (as it could have caused Diamond unnecessary harm) and therefore in breach of Art. 1.1 of the Press Code: “The press shall be obliged to report news…accurately and fairly.”

Transgressing council policy: Meyersdal

While the sentence in dispute was correct, it neglected to state the necessary context. This is in breach of Art. 1.2 of the Code: “News shall be presented in context and in a balanced manner, without any intentional or negligent departure from the facts whether by…material omissions…”

As it also probably caused him unnecessary harm, it is also in breach of Art. 1.1 of the Code: “The press shall be obliged to report news…fairly.”

‘Targeting’ O’Sullivan

This part of the complaint is dismissed.

Not asked for comment on relevant issues

This part of the complaint is dismissed.

Headline misleading

This part of the complaint is dismissed.

General comment

I have decided that the newspaper was justified in:

·         reporting that a case had been opened against Diamond; and

·         using Naidu’s report as a source of information.

“Justified”, but not necessarily “accurate”.

Please note: The newspaper is under an ethical obligation to do a follow-up story if information comes to the fore that contradicts these matters.

SANCTION

Sunday Times is directed to apologise to Diamond for:

·         the incorrect and unfair use of the term “forensic audit”; and

·         unfairly neglecting the necessary context when it referred to the Meyersdal issue.

The newspaper is cautioned for using the term “trust account” instead of “estate late account”.

It is directed to publish the following text:

Beginning of text

Sunday Times apologises to businessman and Ekurhuleni ANC councillor Neil Diamond for using the incorrect and unfair term “forensic audit”, and for unfairly neglecting to refer to the necessary context when mentioning his part in the controversial Meyersdal land deal issue.

Diamond lodged a complaint with the Press Ombudsman about a story that we published on 9 December 2012, headlined ANC councillor in theft probe – Businessman accused of taking cash from dead partner’s estate.

The story, written by Werner Swart, said that Diamond stood accused of pilfering R5.5-million from Mr Jannie van der Walt’s estate. He also reported that a case of theft, forgery and uttering was opened at the Alberton police station against Diamond, and that he had obtained an interdict against forensic consultant Paul O’Sullivan (whom Ms van der Walt had appointed to probe her late husband’s estate).

Ombudsman Johan Retief said that the use of the term “forensic audit”, as well as the neglect to add that Diamond was exonerated of most of the charges against him in the Meyersdal land swap matter, had probably caused him unnecessary harm.

He also cautioned us for using the term “trust account” instead of “estate late account” (from which money was withdrawn) – but he added that this mistake had been immaterial as it was not likely that it could have cause him unnecessary harm.

However, Retief dismissed the complaints that the story incorrectly stated that a case was opened against Diamond, and that he was the sole owner of Solex (that received some money from the estate late account). He said that we were justified in our reporting in these instances, although that did not necessarily mean that our information had been correct.

He also dismissed the complaint that:

·         we had incorrectly stated that Diamond had “targeted” O’Sullivan;

·         we had not asked Diamond for comment on relevant issues; and

·         the headline had been misleading.

Retief stated that, although we were justified in reporting that a case had been opened against Diamond, and that we had justifiably used Naidu’s report as a source of information, it did not mean that this information was necessarily accurate. “Please note: The newspaper is under an ethical obligation to do a follow-up story if information comes to the fore that contradicts these matters,” he stated.

Visit www.presscouncil.org.za for the full finding.

End of text

APPEAL

Please note that our Complaints Procedures lay down that within seven days of receipt of this decision, either party may apply for leave to appeal to the Chairperson of the SA Press Adjudication Panel, Judge Bernard Ngoepe, fully setting out the grounds of appeal. He can be contacted at Khanyim@ombudsman.org.za.

Johan Retief

Press Ombudsman