In what has been termed a David and Goliath battle, the SA Equity Workers Association (Saewa) has laid a R4-billion legal claim against Investec to fight against the handling of investors' pension money by the financial institution.

On Thursday, the Federation of Unions of South Africa (Fedusa) spoke out strongly against Investec and declared unwavering support for Saewa, its affiliate.

"We believe that this legal battle can be compared to the biblical tale of the fight between David and Goliath. Investec obviously has a lot of money to fight this, but we are certain that the workers and pensioners will see justice being done to secure their hard-earned nest-eggs", said Fedusa general secretary Dennis George.

Investec Employee Benefits, formerly known as Fedsure, acted unfairly when it invested employee pension money in financial services companies such as the defunct Saambou, leading to heavy losses, said George.

"The pension funds allege that they were told by Fedsure that their funds had been invested in what is called a guaranteed fund of diversified assets suitable for pension fund investments, with reserves being held to smooth out fluctuations in the markets and to ensure the payment of bonuses.

"Instead, the funds claim, Fedsure placed their money together with shareholders' money in a general fund which was then used to invest in financial services companies as part of Fedsure's own strategy," George said.

This, according to George, caused the funds to suffer huge losses in value, with serious consequences for the members and pensioners.

Losses reportedly skyrocketed to R4-billion when interest was included.

"As a result of its losses, Fedsure did not declare bonuses to the pension funds in both 2000 and 2001... the year it was acquired by Investec with the subsequent name change," he said.

Saewa assistant general secretary Deon van Deventer said the two parties might be in court in 2009, following the recent appointment of a judge.

Investec was not immediately available for comment.

Sapa