The BPC received a great number of complaints from consumers who, as clients of FRF, lost their money. The BPC did not receive any letters or calls from consumers who expressed satisfaction with the services rendered by FRF. It is clear from the complaints received that Financial Research Foundation (Pty) Ltd and its "division", Financial Research Corporation (Pty) Ltd, were instruments to accept money from many consumers without rendering any services. Due to the non-response of FRF to the questions of the BPC, it is not possible to calculate how much money has been lost by consumers. The money lost by consumers was in all probability gained by the directors of FRF and the Friedman family. The information on the file suggests that these two companies were run by AL Friedman, FJL Friedman, LP Friedman, Michelle Friedman and Fritz Friedman.

It is likely that the names of the two companies, Financial Research Foundation and Financial Research Corporation, could also have misled consumers. A "foundation" is an endowed institution (10) which Financial Research Foundation certainly was not. "Corporation" could be described as a body of persons constituting a single legal entity or a body appointed by election to conduct civic business. (11) It is not common in South Africa to use "corporation" as part of the name of a relatively small company. Most South Africans would regard an organisation with the word "corporation" in its name as an organisation with certain official "links", such as the South African Broadcasting Corporation.

A complainant stated that FRF was involved in meaningless correspondence as a delaying tactic. This was also the experience of the BPC. The following are examples. On 7 September 1998 the BPC referred the complaint of Sem to FRF, who responded by asking for information which that the complainant had already supplied to them. On 23 October 1998 FRF was sent a reminder to respond to the complaint of Semono. They did not do so.

On 17 November 1998 (12) the BPC sent a letter to FRF which contained a number of questions. On 7 December 1998 FRF acknowledged receipt of the BPC’s letter and said that the matter was receiving attention. No further communication was received and a reminder sent to FRF on 1 February 1999 was returned by the Post Office marked "Unclaimed". FRF did not furnish the answers to the questions put by the BPC. On 15 December 1998 the auditor of FRF wrote to Aileen Friedman that the company’s liabilities exceeded its assets. On 14 January 1999 Reyneke admitted in writing that the company received various summonses from clients for alleged non-performance of interest calculations. He understandably added that FRF was not liable. He also stated that "... some of these had been settled". The BPC has no evidence that this was indeed the case.

The efforts of FRF were concentrated on obtaining money from clients. Invariably prospective clients were told by the "consultants" that South African banks, as a matter of policy, deliberately overcharge their clients. The prospective clients were also misled into believing that the "recalculation" would be completed within months and that the banks would, upon the receipt of claims, immediate pay the amounts "overcharged", without questioning the claims. What the clients were not told was that banks do not cheerfully accept the recalculations by interest recalculators and are, invariably, willing to contest claims in the courts. It is common knowledge that this is an expensive and time-consuming route. It appears from the complaints received that once FRF was paid, the clients were forgotten. Many of them tried to contact FRF’s management for report back but in vain. It also appears hat FRF presented themselves to prospective clients as "forensic auditors".

From the complaints received against FRF it appears that the money back guarantee was not as straight forward as suggested. For example, the guarantees only applied inter alia should the client provide the necessary bank statements. Many clients could, for various reasons, not obtain these statements. FRF was aware that clients experienced problems in obtaining their bank statements, but did not inform prospective clients of this.

It is relatively easy to become an "interest recalculator". One requires personal computers, an office, telemarketers and "consultants". The computers and the office can be leased and the costs involved in remunerating telemarketers and "consultants" are directly proportionate to the business they generate, assuming that they are remunerated on a commission basis only. The overheads are thus low and entry into the market is easy. Unfortunately, it is as easy to withdraw from the market as it is to enter. The BPC is aware of interest recalculators who vacated their premises overnight to surface again a few months later assuming another "interest recalculating" identity.

According to Reyneke, FRF has entered into negotiations with another firm, Foundation Finance Auditors, with the view to amalgamate the respective businesses. It would not be in the public interest to let the Friedmans continue their activities under the banner of another legal entity.