Tag Archives: Julian Williams

Belvedere: A closer look at Trinity

14 May

Author: Patrick Cairns

Publications: MoneyWeb

Date Published: 14 May 2015

CAPE TOWN – The allegations against Belvedere were first made in OffshoreAlert back in early March. The Miami-based publication claimed to have uncovered “one of the biggest criminal financial enterprises in history”.

There were suggestions that billions of dollars were at risk in what was a web of fraudulent activity.

Despite the size of the alleged scam, a peculiarity of the story is that there has been very little in the way of anyone coming forward to claim that their money is missing. The deVere Group raised the initial concerns about the Strategic Growth Fund, which was the focus of the recent actions by the Guernsey Financial Services Commission (FSC). It is worried about a total £30 million that it has not yet been able to recover from the fund.

No other investors have yet publicly come forward to state that they are worried about missing funds. The scale of what may or may not be compromised therefore remains a point of conjecture.

Much of the speculation around Belvedere has also suggested that everything with any connection to the group must be fraudulent. However, there are investment vehicles associated to Belvedere that are verifiably legitimate, and it is important not to overlook those details.

This is the case with the two sub-funds housed under the Trinity Global Fund in Guernsey. To understand this, it is necessary for some context.

Towards the end of April, the Guernsey FSC successfully applied to have three funds managed by Lancelot Management – the Global Mutual Fund PCC, Universal Mutual Fund ICC and Worldwide Mutual Fund PCC – placed under administration.

The FSC also applied to place a fourth fund, the Trinity Global Fund, under administration. That application was however adjourned to a later date, and has since been adjourned again.

Why is Trinity different?

Trinity is distinct from the other Lancelot-managed funds in Guernsey in that it is a unit trust, rather than a hedge fund vehicle. It currently houses only two sub-funds, the Armstrong Global Diversified Fund and the NeFG Global Diversified Fund.

There are strong connections to South Africa here: NeFG is a local fund manager and the Armstrong Fund is the offshore vehicle into which the MET Global Diversified Feeder Fund invests.

A ‘consent order’ was obtained in court that essentially requires Trinity’s trustee bank, the Royal Bank of Canada, to impose strict conditions on any transactions within these funds. This will stand until May 29, when the application to place Trinity under administration is now set to be heard.

Moneyweb has established that both the Armstrong and NeFG funds have long-only mandates and may only invest in listed securities. In both cases the underlying investments within these cells are exclusively in funds managed by South African asset managers – the likes of Coronation, Sanlam, Investec, Prescient and Stanlib.

Given what has taken place in Guernsey, certain reports have once again questioned whether the money in these funds is safe. The Head of Distribution and Client Services at MET Collective Investments, Kevin Hinton, stated some time ago that he was confident that the assets in the MET Global Diversified Fund could be validated, and he reiterated as much again to Moneyweb this week.

“I still stand by that comment,” Hinton said. “We’ve gone as far as to check the unit registers of the management companies themselves. When we originally got a document from the administrator Lumiere indicating what the underlying assets were, we went to each of those asset managers – the likes of Prescient, Investec and Stanlib – and validated that they were holding those units in their funds by that nominee vehicle.”

As such, he is satisfied that no investor money is compromised.

In the case of the NeFG, as reported towards the end of April, Moneyweb has seen copies of the fund valuation and portfolio valuations confirming its assets. It is invested in only three underlying funds – the RECM Global Fund, Coronation Global Managed Fund, and PSG International Global Flexible Fund – and the assets in each are identifiable and valid.

Moneyweb understands that the NeFG fund is in the process of cashing out its assets as the reputational risk has become too much. It is looking to relocate to another jurisdiction.

Guernsey

These matters taking place in the Royal Court of Guernsey have been the focus of the Belvedere story over the last few weeks. The application to the court to place the Lancelot funds under administration was accompanied by an affidavit sworn by Paul Yabsley, a senior analyst in the enforcement division of the Guernsey FSC that contained the first concrete details of suspicious trades. These had taken place within the Strategic Growth Fund cells of the Global Mutual Fund.

This is the fund about which deVere had expressed its concern.

The trades were a series of investments into the underlying cells of two Mauritius-domiciled funds: Two Seasons and Four Elements. These funds were both administered by Belvedere Management and managed by RDL Management.

The FSC was particularly concerned about what it termed “significant and systemic conflicts of interest” in these transactions, as Cobus Kellermann and David Cosgrove owned or managed entities involved at almost every level. It also submitted to the court that the financial positions which resulted may not have been valued correctly.

The four specific transactions in question were to the value of $10 million, $1 million, $1.5 million and $14 million. The Guernsey FSC also questioned the valuation of a property in Stellenbosch that was bought by one of the Mauritian funds for R28.5 million and sold two years later to another for R72 million.

The affidavit further questioned the sale and transfer of R14 million worth of shares in JSE-listed BKOne between funds linked to Kellermann. The transaction was instigated the day before Herman Pretorius murdered Basilues CEO Julian Williams and then committed suicide.

None of the other cells in either the Global Mutual Fund or any of the other funds placed under administration were specifically mentioned in the affidavit. However the FSC did state its belief that the conflicts of interest it uncovered could extend “to a number of other Managed Funds which have advisers with similar ownerships or investments into Four Elements and Two Seasons.”

It therefore requested that all the funds be placed under administration to allow for proper investigation into whether there was any contagion and to protect investors in the case of redemptions, since there is a risk that net asset values may be incorrect.

The specifics

What the affidavit also highlighted was the need to deal in specifics with regards to the allegations against Belvedere. Suspicious activity has been uncovered, and that must be dealt with on its merits.

The question of whether there has been contagion must be followed up. As that happens, more details may emerge.

It is, however, evident that not everything associated with Belvedere is fraudulent, or even suspicious. Within the Belvedere hive there are genuine funds running demonstrably valid mandates with assets that can be verified. One of the issues the regulators are facing, therefore, is the onerous task of separating the good from the bad.

The problem for investors is that until the regulators’ work is complete, they can’t know the difference. And unfortunately for any fund associated with Belvedere, that may be a death sentence.

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Hof hoor van band tussen Cobus Kellermann, Herman Pretorius

10 May

Author: Nellie Brand-Jonker 

Publications: Netwerk24

Date Published : 10 Mei 2015

Die baasbrein agter Suid-Afrika se reuse-RVAF-piramideskema, wyle Herman Pretorius, word in hofstukke in Guernsey oor beleggingskemas genoem waarby die Kaapse batebestuurder Cobus Kellermann betrek word.

In die hofstukke daar word gesê van die hoogs riskante Suid-Afrikaanse beleggings wat Kellermann as ’n portefeuljebestuurder van ’n Guernsey-fonds gemaak het, was in maatskappye van Basileus Investments.

Wie was Basileus Investments?

Basileus Investments het in 2012 die nuus gehaal toe sy uitvoerende hoof, Julian Williams, in sy kantoor in die middestad van Kaapstad deur Preto­rius doodgeskiet is. Pretorius het homself daarna geskiet.

Volgens die hofstukkie is die JSE-genoteerde BK One gestig as ’n voertuig waardeur kapitaalinspuitings gemaak kon word om die Basileus-verwante maatskappye te ondersteun.

Paul Yabsley, die ondersoeker van Guernsey se finansiële owerheid, skryf in die hofstukke dat die Strategic-fonds in ’n stadium onder leiding van Kellermann direk en indirek deur fondse van Mauritius beleggings en lenings aan Basileus en sy verwante maatskappye gemaak het.

Die hofstukke verduidelik ook hoe die Strategic-fonds in wese R71 miljoen geleen het aan ’n maatskappy om ’n plaas in Helshoogte te ontwikkel en daarna weer R72 miljoen opgedok het om die plaas te koop – om dié lenings aan homself terug te betaal, volgens Yabsley.

Yabsley verwys na die skietvoorval op 26 Julie 2012 toe Williams deur Pretorius geskiet is, glo oor ’n dispuut oor geld wat Basileus se maatskappy AV Alloy aan hom moes betaal het.

Daar is berig dat dié geld deur Pretorius gebruik is om die beweerde piramideskema te finansier. Dit het later aan die lig gekom dat beleggers R2,2 miljard in Pretorius se Relative Value Arbitrage Fund (RVAF) belê het.

Belangebotsings?

Die hofstukke verwys ook na die hoogs omstrede transaksie wat Kellermann gedurende die week van die skietvoorval met BK One-aandele uitgevoer het om die aandele te verkoop. Kellermann was in daardie stadium die eienaar en portefeuljebestuurder van Ankh Analytic wat ’n Ankh-fonds bestuur het wat BK One-aandele besit het.

Ná die skietvoorval het BK One se aandeelprys skerp geval.

Volgens Yabsley is die BK One-aandele aan die Strategic-fonds verkoop teen die prys waarop dit op 25 Julie 2012 verhandel het.

Daar is geen bewyse tot die Guernsey finansiële kommissie se beskikking dat Kellermann in daardie sta­dium enige poging aangewend het om die skietvoorval van Pretorius en Williams en die negatiewe uitwerking wat dit waarskynlik sou hê op die BK ­One-aandele te openbaar nie, voer Yabsley aan.

“Alle aspekte van hierdie transaksie is hoogs twyfelagtig. Sonder twyfel is die Ankh-fondse se belange in BK One verkoop tot voordeel van beleggers in die Ankh-fondse en tot nadeel van die beleggers in die Strategic-fondse.

“Kellermann het groot belangebotsings gehad in alle dele van die transaksie met sowel Ankh as die Strategic-fondse.”

Yabsley sê Kellermann moes al in Junie 2012 bewus gewees het van die bewerings oor die bedrieglike beleggingskema van Pretorius.

Kellermann het onlangs aan Die Burger gesê die opdrag om die BK One-aandele te verkoop, is gegee ’n dag voordat Williams geskiet is. Volgens hom het dit verband gehou met die administrateur van Ankh se opdrag om sekuriteite te verkoop om likiditeit in die fonds te kry.

“Die vereffening van die aandele vind ’n dag of twee ná die transaksie plaas. Daar is niks ongerymd daaraan nie.”

Volgens hom is dit deur die Raad op Finansiële Dienste ondersoek, wat gelukkig was met die antwoorde.

 

Dienstekommissie onthul: Ponzi-manne ‘het lang geskiedenis’

6 May

Author: Marelize Barnard

Publications: Netwerk24

Date Published : 6 Mei 2015

KAAPSTAD. – Wat het die Ponzi-bedrieër wyle Herman Pretorius, die man wat hy doodgeskiet het, Julian Williams, en die beleggingsbestuurder van Welgemoed, Jacobus Kellermann, met mekaar te doen?

’n “Lang geskiedenis” – as dit van die Finansiële Dienstekommissie van die Britse eiland Guernsey (GFSC) afhang.

Die skietery waarin Pretorius op 26 Julie 2012 eers vir Wil­liams en daarna homself geskiet het, is in die Guernsey-hooggeregshof vir die eerste keer in openbare hofdokumente aan internasionale aandeletransaksies gekoppel.

Kellermann, wat net soos Pretorius spogeiendom in Welgemoed aangeskaf het – en ook soos Pretorius ’n voorliefde vir vinnige sportmotors het – word by dié aandeletransaksies betrek. Kellermann en sy sakevennoot, David Cosgrove, is die afgelope twee maande al hoe meer in die nuus oor die beleggingsfondse waarby hulle in veral Mauritius en ook Guernsey betrokke is en ondersoeke na hul betrokkenheid by die bestuur van internasionale beleggingsfondse.

Die Pretorius-skietery:

Pretorius en Williams se skietdood was ’n dag nadat Kellermann betrokke geraak het by die verkoop van 1,4 miljoen aandele in die beleggingsmaatskappy BK One, wat gebruik is as beleggingsmedium om beleggers te kry om in maatskappye te belê wat aan die Basileus-groep behoort het.

Pretorius se beleggers het in een van die Basileus-maatskappye, AV Alloy, belê. In Pretorius se poging om sy Ponzi-skema geheim te hou, het hy R40 miljoen aan Williams geleen om aan sy beleggers uit te betaal en daardeur te probeer voorgee alles gaan goed.

Williams en Pretorius het hieroor gestry, wat klaarblyklik tot die skietvoorval gelei het.

Op dieselfde dag van die skietvoorval is 1,4 miljoen aandele in BK One verhandel. Dit is aandele wat aan Ankh behoort het, ’n beleggingsfonds wat deur Kellermann bestuur is.

Die verkoop van aandele:

Die Ankh-aandele in BK One is volgens die Guernsey-hofstukke deur nog ’n entiteit, Citygate (’n maatskappy in Mauritius wat deur Kellermann en Cosgrove bestuur is), aan nog ’n entiteit, Strategic Cells, verkoop. Die verkoopsprys was glo teen die waarde van die aandele soos vasgestel die dag voor die skietvoorval.

Intussen het die skietvoorval ’n “dramatiese” impak gehad op die waarde van die BK One-aandele. “Alle aspekte van die transaksie” kan volgens die hofstukke voor die Guernsey-hooggeregshof op hoogste vlak bevraag-teken word. Daar word aange-voer dat Kellermann in ’n groot-skaalse belangebotsing was omdat hy namens Ankh én Strategic Cells opgetree het.

Kellerman het volgens die bewerings van die Guernsey Finansiële Dienstekommissie nie die nodige inligting van die skietvoorval of die moontlike negatiewe nagevolge wat dit op die BK One- en Basileus-aandele sou kon hê aan die relevante betrokkenes verklaar nie.

Wat sê Kellermann?

Kellermann het op 25 Maart aan Die Burger gesê hy was as raadgewer betrokke by ’n maatskappy wat genoteerde BK One-aandele gekoop het. Die beleggingspan het dit verkoop na aanlei-­ding van ’n versoek van die besturende maatskappy om kontant in die portefeulje te verhoog.

Kellermann en Cosgrove het gister deur hul regsverteenwoordiger, Werksmans-regsfirma, by navraag oor die bewerings in die Guernsey-hofaansoek gesê hulle gaan vir eers nie verder kommentaar lewer nie.

Failed fund claims hit R12.3m

20 Apr

Author: Roy Cokayne

Publications: iOL -The Mercury

Date Published: 17 April 2015

REPORT  
THE total amount that three financial advisers need to repay 22 investors they wrongly advised to place money in the Relative Value Arbitrage Fund (RVAF) has now escalated to more than R12.26 million. 
This follows several further determinations issued by the ombud for financial advisory and intermediary services (Fais) Noluntu Bam against these financial advisers. None of the three financial advisers have filed notices of appeal against the determinations. The fund collapsed after its manager and trustee Herman Pretorius committed suicide in July 2013 after shooting dead his business partner Julian Williams. The Fais ombud last year issued 16 determinations against financial adviser Michal Calitz and/or Impact Financial Consultants to repay investors more than RIOm. The ombud has issued a further six determinations to date this year against financial advisors to repay their investment clients a total R2.24m. Five determinations were issued ordering financial advisor Andrea Moolman and/or Vaidro Investments to repay five of her clients a total of more than R1.6m. In one further determination, financial advisers Simon Morton and Carol Louw and/or Catwalk Investments 592 cc trading as Pinnacle were last month ordered to repay a client R600 000. Bam has made similar comments in the determinations issued to date related to RVAF, including that the complaints were about being advised to invest in a scheme that was not above board. She said neither Pretorius nor the RVAF itself was licensed “in any way”, which was a clear contravention of the Fais Act. 
Risks 
In the determination made by Bam against Vaidro Investments and/or Andrea Moolman in regard to a complaint lodged by Leon van der Walt, who invested R206 000, Bam said the issues principally pertained to the failure of Moolman to understand the fund and the risks to which she was exposing her clients when advising them to invest in RVAF. Bam added that there were no financial statements for RVAF and without financial statements “or so much as a fact sheet” Moolman could not have understood the economic activity that generated the returns of the fund. She said Moolman was unable to explain why RVAF was nowhere to be found in the documentation she used in support of recommendations she made to investors. “The inescapable conclusion is that respondent (Moolman) knew nothing about the fund or its underlying investment and accordingly was in no position to advise her clients to invest in it,” she said. Bam said Moolman had breached the general code, which required that a provider must at all times render financial services honestly, fairly, with due skill, care and diligence, and in the interests of the client and the integrity of the financial services industry. She said Van der Walt was in no position to understand the “any material investment or other risks associated with the product” as required by the code.

Belvedere Management: Massive Criminal Enterprise or Defamed Fund Manager?Posted on April 11, 2015 by

11 Apr

Author:  

Publications: naked capitalism

Date Published :11 April 2015

…….. Looking a little further afield in the Belvedere fund universe, we find some other nuggets.

First, Belvedere runs some onshore funds in South Africa, but a presumably rather sweaty independent audit, initiated very soon after Marchant’s article came out, says they’re fine.

Second, Belvedere man Cobus Kellerman had some wonderful investment timing when his Ankh Analytic sold out its indirect holdings in Basileus Capital on the very day its principal, Julian Williams, was shot and killed  by his former business partner Hermann Pretorius, who then shot himself.  Pretorius’ RVAF Trust then turned out to be a Ponzi. Basileus Capital got into difficulties too:

The empire of slain businessman Julian Williams appears poised for collapse, following the announcement that his Basileus Capital group has initiated “business rescue proceedings”.

Business rescue is an alternative to liquidation provided for under the updated Companies Act.

Also at risk are investors in the JSE-listed BK One, a capital-raising vehicle for Basileus.

There is a trail of related party trans­actions, comprising intercompany investments, loans and write-offs, which raise questions about how much of the cash Basileus was able to raise from investors actually made its way into the project “pipeline” of which it boasted.

Belvedere crops up in the BK One story again, benefitting handsomely from a relatively terrible BK One deal for shares in Avalloy:

The February report discloses that R52-million was used to buy shares in Avalloy from SA Superalloys and from a mysterious Mauritian investment fund called Four Elements. A further R11.6-million was spent in taking over a loan to Avalloy that Four Elements had extended. Part of the loan had been converted into shareholding, meaning BK One had bought an effective 10.5% shareholding in Avalloy at a cost of R65-million. In contrast, the Industrial Development Corporation got its 10% in effect for free – a bonus for providing a R35-million loan.

Even more curious is that an associate of Four Elements was the major subscriber to shares in BK One, accounting for nearly half of the R200-million raised. The second-biggest shareholder in BK One, with 17%, is another Mauritian entity, Two Seasons, which shares the same management team as Four Elements: Ken Maillard and David Cosgrove of Belvedere Management, Mauritius. A message left on Belvedere’s automated answering service went unanswered.

Third, Belvedere funds made (purportedly modest) investments in the very dreadful Harlequin Property scheme, famous in the UK, a  resort development company that sucked up £400Mn of investor funds and ran out of cash with hardly any of the promised development complete.

Fourth, David Cosgrove of Belvedere has some previous form:

The now exposed Belvedere Ponzi kingpin David Cosgrove is no stranger to the South African financial authorities. Just over a decade back, he single handedly collapsed JSE-listed financial services company mCubed after the Reserve Bank and SARS discovered he was helping clients to illegally ship money offshore.

Described by those who know him as a high-pressure salesman who considers laws and regulations the same way SA taxi drivers view traffic lights, Cosgrove used the institutional offshore allowance as a vehicle to prey on rich South Africans nervous about the country’s future.

When the scheme was discovered, the authorities levelled a R140m fine on mCubed, which in effect killed the business, a piece of which was later picked up by the equally corrupted Fidentia. As a result, Cosgrove is about as popular at the Financial Services Board and in SA financial circles generally, as Netanyahu would be at an ISIS gathering………..

Vrae oor beleggings: Herman Pretorius se spook loop weer

25 Mar

Author: Marelize Barnard

Publications: Die Burger

Date Published : 25 Maart 2015

NOG ‘N PONZI-SKEMA?

Kaapse sakeman praat vandag

Die Ponzi-bedrieër Herman Pretorius se spook loop weer in beleggingskringe.

En dié keer word daar weer ’n miljoenêr-beleggingsbestuurder van die ryk Kaapstadse voorstad Welgemoed genoem.

Die naam van Cobus Kellermann (39), ’n batebestuurder wat sakebande gehad het met Julian Williams wat in 2012 deur Preto­rius doodgeskiet is, word nou in nuusberigte genoem in verband met vrae wat ontstaan het oor beleggings van honderde miljoene rande.

Kellerman – met sakebelange so wyd as Somerset-Wes, Durban­ville, Mauritius en Switserland tot die eiland Guernsey in die Engelse Kanaal – woon twee strate van wyle Pretorius se ontwerpershuis wat verlede jaar vir R12,8 miljoen opgeveil is.

In 2012, toe ​Pretorius eers vir Williams, sy oudsakevennoot, en daarna homself in die middestad van Kaapstad doodgeskiet het, het dit bekend geword dat Kellerman se twee beleggingsfondse wat in Mauritius geregistreer was groot bedrae belê het in ’n maatskappy wat weer groot belê het in Basileus Capital, waarvan Williams die uitvoerende hoof was.

Dinsdag is in Sake berig Kellermann word verbind met ’n internasionale beleggingsgroep, Belvedere Management, wat uit Mauritius bedryf word en wie se kapi-taalgroeisyfers glo onder verden-king is.

Die Burger het Dinsdag Kellermann se huis in Welgemoed besoek om sy kommentaar te kry. ’n Man wat die interkom by ’n veiligheidshek geantwoord het, wou nie kommentaar lewer nie.

Hoewel in berigte verwys word na Kellermann se voorliefde vir vinnige motors, soos ’n rooi Ferrari, was daar geen sportmotors in die oprit nie, maar wel ’n Toyota Prado en ’n Isuzu-bakkie.

Met ’n tweede besoek aan die woning het ’n vrou, wat uit ’n wit VW Touareg geklim het, die veiligheidshekke haastig toegesluit. Sy het net voor sy die huis se deure toegemaak het, op ’n verslaggewer van Die Burger, Jason Felix, geskree: “Gaan weg, asseblief. Ons het geen kommentaar oor alles nie. Gaan net weg.”

Kellermann het intussen aan Johan Theron, prokureur van die regsfirma Werksmans, opdrag gegee om hom en sy sakevennoot, David Cosgrove, by te staan nadat “ongegronde en skadelike aanmerkings” deur ’n oorsese publikasie gemaak is “en nou ook deur plaaslike media herhaal word”.

Theron het gesê Kellermann en Cosgrove is bereid om vandag persoonlik vrae te beantwoord oor die aantygings, asook presies wat Kellermann se verbintenis met onder meer Basileus, Wil­liams en Pretorius was.

Tighter regulation for hedge funds

14 Mar

Author: Bruce Cameron

Publications: iOL

Date Published: 14 March 2015

Hedge funds, which manage assets of more than R57 billion, mainly from retirement funds, will have to register as collective investment schemes by the end of March next year in terms of new regulations by National Treasury and the Financial Services Board (FSB).

This will result in far more protection for investors in hedge funds, which are currently unregulated. Until now, hedge fund managers have only had to register with the FSB as financial services providers.

The absence of regulation allowed things such as the massive Relative Value Arbitrage Fund scam, in which about 3 000 people invested about R2 billion in an unregulated fund posing as a hedge fund. The fund collapsed in 2013, when the person who ran it, Herman Pretorius, shot himself after killing his business associate, Julian Williams, after the FSB started a much-delayed investigation.

The regulations, which will be implemented from April 1, 2016, will require all new hedge funds to register in terms of the Collective Investment Schemes Control Act (Cisca), while existing hedge funds will have 12 months to register.

The regulations create two broad categories of hedge fund, each with different levels of regulation:

* Qualified investor hedge funds, which are limited to institutions, such as retirement funds, and very wealthy individuals who have large sums to invest. These funds are less rigidly regulated. Investors must be able to demonstrate to the fund managers that they have sufficient expertise to understand the workings and risks of hedge funds.

* Retail hedge funds, which are open to ordinary investors, although the minimum investment amounts are usually fairly high. They are more strictly regulated than qualified investor funds, and the risks they are allowed to take are more limited.

The new hedge fund regulations follow changes to regulation 28 of the Pension Funds Act four years ago that allowed retirement funds to invest significant amounts in hedge funds.

The regulations also come at a time when investors internationally are expressing greater caution about hedge funds, because of complexity, fraud, costs and poor performance. For example, in 2014, one of the world’s biggest retirement funds, the California Public Employees’ Retirement System, announced plans to start cashing in the US$4 billion it had invested with hedge funds, saying they were “too expensive and complex”.

The aims of the regulations are to:

* Provide investors in hedge funds with better protection;

* Assist in monitoring and managing systemic risk to the financial services industry;

* Promote the integrity of the hedge fund industry;

* Enhance transparency in the hedge fund industry, which traditionally has been ultra secretive; and

* Promote the development of financial markets.

The regulations state that hedge funds will be taxed on the same conduit basis as all other collective investment schemes, such as unit trust funds.

The conduit principle means that investors pay tax only when they receive returns. So any interest or dividend payments are taxed in the hands of the investor when they accrue; and income tax (if the investment is sold in less than three years) or capital gains tax apply to any gains or losses on the sale of an investment.

The regulations, in effect, accord hedge funds a special status in terms of Cisca. Unit trusts funds, which are also governed by the Act, cannot use the investment strategies and financial instruments that often form the backbone of hedge funds (see “What are hedge funds?”, below). For example, unit trust funds are not allowed to borrow to invest, nor can they use most derivatives.

But the regulations will not open the door to a “wild west”. There are strict controls, particularly in the case of retail hedge funds, on investment strategies, gearing and financial instruments.

The South African hedge fund industry grew its assets under management by R10.5 billion during 2014, ending the year with assets under management of R57 billion.

These assets are invested in 113 hedge funds, which are managed by 55 hedge fund managers (fund of hedge fund managers excluded).

‘WELCOME DEVELOPMENT’

The declaration of hedge funds as collective investment schemes by National Treasury and the Financial Services Board (FSB) is a welcome and long-awaited development, says Leon Campher, chief executive of the Association for Savings & Investment SA (Asisa).

Campher says Asisa partnered with National Treasury and the FSB for several years to regulate hedge funds, which had been pushing for clarity on product regulation.

“Generally, regulation assists with the growth and management of an industry, as it provides much- needed clarity to industry participants and investors alike. Consumers, whether they are institutional or retail, also find comfort in the fact that an independent body – the FSB – is overseeing the industry operations and structures that manage their investments,” Campher says.

He says that South African financial regulators accepted in 2007 that hedge funds needed some form of regulatory supervision. Initially, this was thought to be appropriate at only manager level, since hedge fund managers are held to higher experience standards, greater capital adequacy requirements and stricter qualifications than their “long only” peers. However, since the global financial crisis of 2008, South African and global regulators have been reviewing the situation.

REGULATIONS FOR QUALIFIED AND RETAIL FUNDS

Under the new regulations, general conditions apply to both retail and qualified investor hedge funds. For example, they are restricted in the main to using securities and derivatives that are listed on registered securities exchanges. There are also limitations on the percentage of a fund that may be invested in any one security. These limitations apply to all collective investment schemes, to reduce risk of a major loss if there was a total failure of a single underlying investment.

The specific conditions that apply to qualified investor funds include:

* They are restricted to “qualified investors”. This is someone who can invest a minimum of R1 million per hedge fund and who has demonstrable knowledge and experience in financial and business matters that enable the investor to assess the merits and risks of a hedge fund investment; or who has appointed a financial services provider who has demonstrable knowledge and experience to advise the investor about the merits and risks of a hedge fund. A qualified investor can be an individual or an entity, such as a retirement fund.

* There are limitations on investment strategies that expose an investor to a loss in excess of the value of its investment or contractual commitment to a fund.

* The fund manager must set a “value-at-risk”, which is a measure of the maximum expected loss of a portfolio over a specified period.

* Have sufficient liquidity (cash and easy-to-sell assets) that enable the manager to pay out investors within three months of an instruction to sell.

The specific requirements for retail hedge funds include:

* The fund must have sufficient liquidity to enable its manager to pay out investors within three months of an instruction to sell. A unit trust fund must pay out an investor within 48 hours, but, because of the contractual nature of derivatives, there are constraints on when the underlying investments of a hedge fund can be cashed in.

* The fund manager is limited to borrowing up to 10 percent of the value of a portfolio for liquidity purposes.

* The manager may borrow against the fund’s assets only for investment purposes, when borrowing funds for taking short positions or engaging in derivative transactions with counterparties (see “What is a hedge fund?”, below).

* Gearing (borrowing to invest) is restricted to a maximum of 20 percent of the total net asset value of the portfolio.

* Managers must report to the Financial Services Board monthly, within 14 days of the end of the month, all long and short positions in the portfolio, reflecting the market value and the effective exposure and value of each of the underlying investments.

* The fund may not invest in property, the portfolio of a fund for qualified investors or a private equity fund.

* If the portfolio includes derivatives, the manager must ensure that the fund’s exposure to derivatives does not exceed the net asset value of the portfolio.

WHAT IS A HEDGE FUND?

Hedge funds are similar to unit trust funds in that investors’ money is pooled to buy assets. The main difference is that hedge funds have more flexibility in the financial instruments and investment strategies they can use, and they can borrow money against their assets, to multiply returns (but they can also multiply losses).

Hedge funds should not be confused with hedging, which is an investment strategy to reduce potential losses.

Most hedge funds are more risky than unit trust funds. On average, they are far more expensive than unit trust funds, which reduces the returns.

Hedge funds use many different strategies to earn returns, from trading in stressed debt to finding small gaps in the prices of securities. Most of these strategies are not permitted in terms of the new regulations.

Most hedge funds, particularly more traditional ones, use what are called long-short strategies to provide superior returns, whether investment markets are rising or falling. These involve buying some securities long and selling others short.

Buying long means buying a security (bond or share) to hold on to it in the hope that it will increase in value.

Selling short is a bit more complex. The manager borrows (rents) shares from another investor and sells the shares in the expectation that the share price will drop. When the price drops, the manager buys back the shares at a cheaper price to give back to the original owner, making a profit on the difference between the selling and buying prices (less the rental).

There are many risks associated with hedge funds, which the regulations aim to reduce but do not eliminate. These include:

* Liquidity risk. It is often difficult to sell a fund’s underlying investments because of contractual or market conditions. In extreme market conditions, liquidity problems can cause a fund to collapse.

* Pricing risk. It can be very difficult to value the assets in a fund at a particular time.

* Counterparty risk. Hedge funds tend to deal with other parties when purchasing derivatives, borrowing securities and gearing (borrowing). There is a risk that a counterparty may fail to meet its commitments, which will have a knock-on effect on the fund.

* Short squeeze risk. This is the risk that the securities required for a shorting contract will not be available when required.

* Financial squeeze. This is the risk that a manager will be unable to borrow, or to borrow at an acceptable rate, frustrating the strategy followed by the manager.

* Timing risk. This is the risk that the manager simply gets it wrong.

Weelde met Ander se Geld

29 Nov

Almari Wessels

Huisgenoot

14 August 2014

Ons loer in die swendelaar Herman Pretorius se spogwoning met sy duur meubels, en vra die mening van twee binneversierders.

Daar is lang splete in die imposante veiligheidshek en terwyl ons vir die agent wag, kan ons nie help om solankndaardeur te loer om ‘n glimp te kry van die rykmanshuis daaragter waaroor al so baie geskryf en gegis is nie.
Die deel van die huis wat ons sien, is teleurstellend: Die gras is hopeloos te lank en die plante en bome lyk moeg en verwaarloos, glad nie wat mens in Welgemoed, een van Kaapstad se spogwoonbuurte, verwag nie.
Maar nou ja, die huis se gewese inwoners moes die afgelope twee jaar seker groter probleme as gras sny trotseer.
Die openbare veilingvan die kasarm by Van de Graafstraat 26 is een van die laastehoofstukke in ‘n opspraakwekkende drama wat op 26 Julie 2012 begin het toe die patriarg Herman Dempers Pretorius hom en sy oudsakevennoot Julian Williams in Julian se kantoor in Kaapstad doodskiet.
Die “beleggingsmagnaat” Herman is na sy dood as ‘n swendelaar ontmasker en die “fondse” waarin beleggers sowat R2,2 biljoen bele het, was toe eintlik piramideskemas.
En nou word die huis waarin Herman, sy vrou, Susan-Ann (53), en hul seuns van in die 20, Andrew en Christopher, gewoon het, opgeveil en kan die publiek vir die eerste keer sien hoe die binnekant lyk.
Susan-Ann is in Oktober verlede jaar finaal in die Wes-Kaapse hooggeregshof gesekwestreer nadat sy die aansoek hewig teengestaan het. Daarna kon die trustees van twee van haar man se “beleggingskemas”, die Relative Value Arbitrage Fund en Seca Trust, eindelik die huis laat opveil.
Die gesin se vakansiehuis op Hermanus is verlede jaar al vir R16,5 miljoen opgeveil en twee eiendomme wat Herman vermoedelik vir sy seuns aangeskaf het, ‘n huis in Oranjezicht en ‘n woonstel in Claremont, het onderskeidelik R4,9 miljoen en R3,2 miljoen gehaal.Herman en Susan-Ann het die Welgemoed huis in 22004 vir R2.5 miljoen gekoop, maar voor sy dood het Herman die waarde van die huis op R25 miljoen geraam nadat die gesin binne twee jaar sowat R13.3 miljoen aan bouwerk en binneversiering bestee het.
En vandag kom Huisgenoot kyk hoe die indrukwekkende glaspaleis wat met ander se geld gebou is, binne lyk. Ons het twee binneversierders genooi om saam te kom en hul indrukke te deel: Nico Alberts van Nico Alberts Interiors en Nicola Rossouw van House Couture Interior Design, albei van Kaapstad.
Van Buite
Mens mag nie alleen op die erf van 3200 m2 of in die huis ronddwaal nie, en die afslaer Claremart se agente kom haal mense by die elektroniese hek. Op versoek van Susan-Ann mag besoekers ook geen foto’s neem nie.
‘n Mens verstaan dadelik waarom die huis die bynaam glaspaleis gekry het: Al die glas skuifdeure en -vensters laat dit lyk of die buitemure van glas is.Die glas word afgewissel met moderne staalstruture en afrondings van sandklip versag die andersins strak en harde lyne. Die soort ontwerk is baie modern en tipies van hedendaagse Suid-Afrikaanse argitektuur, se Nico en Nicola.
Ingang en GrondVerdieping
Wanneer jy die huis deur die reuse glasdeure binnestap, is jou eerste indruk een van ‘n ontsaglike, gestroopte ruimte. Die grondverdieping is ‘n enorme dubbelvolume-vertrek met reuse glasvensters, gordyne en blindings wat twee verdiepings ver van die plafon tot by die vloer strek.
Die elegante kroonkandelaar van handgeblaasde glas hang ook twee verdiepings diep en is sowat R30 000 werd, se Nicola.
Die gordyne en blindings word met afstandbeheer oop-en toegemaak en is ontwerp om ‘n warm, knus dop vir die andersins koue en taamlik siellose omgewing geskep.
In ‘n hoek lei ‘n elegante marmer trap met glasrelings na die tweede verdieping. Die relings en raamlose glas moes ook nagenoeg R30 000 gekos het, raam Nicola.
Die meubels om die grondverdieping is gerangskik sodat dit vier afsonderlike vertrekke vorm wat inmekaarvloei en net geskei word deur afskortings wat sonder deure van die plafon tot op die grond strek.
Al die sagte meubelbedekkings is neutrale kleure, en tekstuur word verleen deur materiale wat wissel van ryk fluweel tot linne van aardse kleure, verduidelik Nico.
Die vloer is van marmer waarop spesiaal ontwerpte wolmatte in ligte skakerings plek-plek neergesit is, en teen die mure hang kontemporere kunswerke wat perfek met die kleurskema saamsmelt. Die matte is elk tussen R30 000 en R50 000 werd, skat die binneversierders.
Elke vertrek is met ‘n fokuspunt ontwerp, verduidelik Nico. Die fokuspunt van die hoof-leefvertek is ‘n lang, plat, supermoderne kaggel en die van die TV-kamer langs die kombuis is elegante, grys mure wat met materiaal oorgetrek is.
In die hoofleefvertrek staan ‘n L-vormige ontwerpersbank wat volgens hofdokumente R48 600 gekos het. Nicola raam die gesamentlike waarde van die banke en die stoele op die grondverdieping op sowat R130 000.
Twee kombuistafels wat op ‘n oop oppervlak langs die televisiekamer staan, is volgens Nicola sowat R55 000 elk werd. Die stoele is weg: Suasn-Ann het dit glo saamgeneem. “Met die stoele by sal die tafels sowat R150 000 elk werd wees.” se Nicola.
Die enorme kombuis bestaan uit drie lang, smal vertrekke met afskortings tussenin en is elke sjef se droom. Die toonbanke is met graniet afgewerk en die kaste is van kiaathout – “modern en goed afgerond”, meen Nico.
Aan die kombuis grens ‘n motorhuis met ‘n marmervloer waar die Pretoriusse se Aston Martin DB van R2,5 miljoen en ‘n Range Rover van sowat R1 miljoen waarskynlik geparkeer gestaan het.
Eerste Verdieping
Die poraal van die eerste verdieping het vloere van soliede hout. Reg langs die trap staan ‘n Barcelona-dagbed, ‘n ikoniese meubelstuk geinspireer deur die beroemde Duits-Amerikaanse argitek Mies van der Rohe.
Ons loop na die slaapkamers, wat almal volvloerwoltapyte het. Soos ‘n mens kan verwag, het die hoofslaapkamer ‘n weelderige instapkas. Die skrynwerk hier is spesiaal vir die vertrek ontwerp en met ‘n liggrys Duco-verf (‘n soort emaljeverf) afgewerk, verduidelik Nico. In die hoek van die instapkas is ‘n glasstort wat tot by die dak strek en op ‘n binnenshuise tuin afkyk.
Al die beddens in die slaapkamers het ‘n koppenent van Franse Linne en chenille wat van muur tot muur strek. Elke slaapkamer het ook ‘n en suite-badkamer met glasstorte, mmarmervloere en -mure en in die hoofslaapkamer is marmertrappies tot in die bad.
In wat vermoedelik die Pretorius-seuns se kamers was, staan rugbyballe en speelgoedbbeertjies nog op die rakke. Op die een kamer se vloer is drie lee Adidas-bokse opmekaargestapel.
Al die kamers het glasdeure wat na ‘n balkon lei van waar mens ‘n pragtige uitsig het op ‘n lang, nou swembad en die lower-groen boomtoppe van Welgemoed.
‘n Mens kan van hier af ook sien hoe verwaarloos die tuin eintlik is en die in die linker-hoek van die grasperk le ‘n verdwaalde rugbybal. Dis alles tekens van die lewe wat die ggesin eens hier op die omheinde erf gelei het.
Kelderverdieping
Nog ‘n paar stelle marmertrappe later kom ons in die kelderverdieping aan, waar die vertrekke is van waar die Pretorius-gesin hul elektrisiteit so opgejaag het. Volgens ‘n broon na aan die ondersoek het die gesin elke maand byna R40 000 aan krag bestee en as jy die wynkelder, gimnasium, sauna en rolprentkamer sien, kan jy verstaan hoekom.
Die wynkelder is van dak tot vloer van hout en die temperatuur word elektronies beheer, se Nicola. Die glasdeur daarheen is gesluit, maar jy kan sien die rakke dra nog tiientalle bottels wyn.
In die gang wat na die gimnasium en wynkelder lei, staan twee lae uitgekerfde houtbankke. Die rolprentkamer het meubels in ‘n Indonesiese styl: uitskopleerstoele en ”n lang, halfronde bank met sitplek vir maklik agt mense. Nicola skat die waarde van die meubels op sowat R80 000.
In die gimnasium is ‘n trapmeul, ‘n roeimasjien, verskeie gewigte, nog oefeninstrumente en neffens die gimnasium is ‘n piepklein sauna.
En Wat is die Kenners se Oordeel?
Die huis is vir hom koud en sielloos, is Nico se slotsom toe ons weer buite die elektroniese hek staan. Nicola stem saam – die decor is taamlik klinies en onpersoonlik, se sy, maar ‘n mens moet ook onthou dis mense se gekoesterde persoonlike besittings wat lewe aan andersins karakterlose vertrekke gee, en die is lankal hier verwyyder.

Ekstra Bronne: Die Burger, Moneyweb

Kurators soek steeds Pretorius-miljoene

14 Oct

Author: Marelize Barnard

Publications: Die Burger

Date Published : 14 Oktober 2014

Die kurators van wyle Herman Pretorius se maatskappye en trusts soek steeds na die geld wat in sy beleggingskema verdwyn het.

In die jongste verslag deur die kurators se prokureurs, Mostert en Bosman, oor die soektog na geld word genoem dat die meeste van die makelaars wat kommissie van Pretorius ontvang het, reeds ondervra is.

Vyf makelaars het ooreenkomste aangegaan met die likwidateurs en hulle het reeds R1,8 miljoen terugbetaal. ’n Verdere sowat R2,4 miljoen gaan deur dié makelaars terugbetaal word.

In die gevalle waar makelaars nie vrywillig hul kommissies terugbetaal nie, is aansoeke in die Wes-Kaapse hooggeregshof teen hulle ingedien.

Een van die makelaars, Michal Calitz, is besig met ’n aansoek om verlof tot appèl teen ’n uitspraak van regter Monde Samela in die Wes-Kaapse hooggeregshof. Dit is nadat Monde gelas het dat Calitz, sy beslote korporasie Impact Finansiële Konsultante, en die maatskappy EQ Prop R9,06 miljoen moet terugbetaal.

Dit sluit in kommissie, ’n lening deur ​Pretorius en ’n geskenk van R250 000 wat Calitz aan die twee gesekwestreerde trusts van Pretorius moet terugbetaal.

Die bevel is gemaak ná ’n aansoek deur die kurators van Pretorius se gesekwestreerde Relative Value Arbitrage Fund (RVAF) en sy Seca-trust.

Lesers se mening op Facebook oor Pretorius en hul geld:

Quintin Papenfus: “Ek weet van twee gesinne wat al hulle spaargeld verloor het. Dit natuurlik by Pretorius belê. Hulle kry bitter swaar vandag. Hy het soveel mense ingeloop . . . ek twyfel of hulle ooit hulle geld gaan terug kry.”

Soekie Bester: “Ons was slagoffer van hierdie skelm mense, het uit onkunde ons jarelange makelaar geglo. Nee, ek kon nog nie hierdie mense hul gulsige luukse lewe op ander se swaarverdiende lewensgeld vergewe nie!”

Annatjie Jonker: “Ja Herman Pretorius . . . dit is ’n psigopaat wat mense so in die oë kon kyk en vertel hoe hy risiko bestuur, hoe dinge beheer word, ens., welwetende dat die alles leuens is.”

Philip Meiring: “Julle moet rondkyk daar is nog baie van Herman Pretorius se eweknieë in die rondte, hulle skroom nie om jou geld te vat nie.”

Swaer getuig oor weelde voor dood

11 Oct

Author: Marelize Barnard

Publications: Die Burger

Date Published : 11 Oktober 2014

Van die Hardekraaltjie-woonwapark in Voortrekkerweg, Bellville, tot ’n multi-miljoenrand-huis in Welgemoed – dít is die pad wat die swendelaar Herman Pretorius geloop het.

Pretorius kon nie altyd ’n Aston Martin, luukse vakansiehuis in Voëlklip, Hermanus, en juwele van honderdduisende rande vir sy vrou, Susan-Ann, bekostig nie.

Daar was ’n tyd nadat sy sake in George “verkrummel” het toe die Hardekraaltjie-woonwapark al uitweg was.

Dít was gister van die getuienis van wyle Pretorius se swaer, Srecko Antun Bilobrk, ’n Kroasiër wat hom jare gelede in Suid-Afrika gevestig het en met Susan-Ann se suster, Carol-Ann, getroud is.

Bilobrk, ’n elektriese ingenieur, het in die Bellville- siviele hof in die sekwestrasie-ondervraging oor Susan-Ann se geldsake getuig.

Bilobrk was die laaste familielid met wie Pretorius gaan gesels het voor hy op 26 Julie 2012 eers sy voormalige sakevennoot Julian Williams en daarna homself in die Icon-gebou in die Kaapstadse sakekom doodgeskiet het.

Pretorius het op die dag van die skietery van sy kantoorkompleks in die Tyger-waterfront in Bell­ville gery en onverwags by sy swaer se huis in Kampsbaai opgedaag. Pretorius het gesê hy is in die stad om Williams te kom sien.

“Hy het gesê hy het R100 miljoen aan Williams geleen om die geld van die mense in sy tuisdorp (Piketberg) te betaal. En dat die hele dorp gaan ontplof omdat die geld nie betaal is nie,” het Bilobrk getuig.

“Hy het gesê hy het ’n halfuur. Hy het koffie gedrink en was gespanne. Die mense in sy tuisdorp is nie betaal nie . . . En toe hoor ons die nuus ’n paar uur later,” het Bilobrk getuig oor Pretorius se laaste oomblikke.

Adv. Almero de Villiers, wat namens die kurators van Preto­rius en Susan-Ann se trusts optree, wou by Bilobrk weet wanneer Pretorius hom gevra het om na sy (Pretorius) se gesin om te sien.

Bilobrk het geantwoord nadat Pretorius teruggekom het van ’n vakansie in Turkye het hy “vir die eerste keer in sy lewe gesê hy voel bedreig.

Pretorius het gesê Julian (Wil­liams) is bipolêr en daartoe in staat om enigiets te doen. Hy het gesê hy voel bedreig en dat hy nou met ’n ander motor ry.

Bilobrk het hierna getuig dat Pretorius hom gevra het om na sy gesin om te sien. “Ek het gedink hy maak ’n grap.”

De Villiers het hierop aangevoer dat Pretorius se seun Andrew gesê het Pretorius het ’n sak geld vir Bilobrk gegee, waarop Bilobrk dit ontken het. “Ons het nooit enige geldelike ooreenkomste gemaak nie.”

De Villiers het Bilobrk gevra waarom hy dan maandeliks R35 000 aan Susan-Ann gee sedert haar man se dood – dit beloop al tussen R500 000 en R600 000.

“Jy moet dit kan insien dat dit lyk asof Herman Pretorius geld aan jou gegee het, wat jy nou uitdeel.”

Bilobrk het geantwoord hy verwag Susan-Ann sal die geld terugbetaal uit die polisgeld wat sy ná Pretorius se dood ontvang het. Hyself het nie ’n sak geld van Pretorius ontvang nie.

■ Pretorius het R2,2 miljard van beleggers ingevorder in ’n belegging-piramideskema.

Waar kry sy nou haar geld?
■ Susan-Ann Pretorius en haar regsverteenwoordiger, Etienne Naude, was nie gister by die sekwestrasie-ondervraging nie. Hulle het ook nie sekere dokumente en bankstate oorhandig soos wat die kurators van Susan-Ann se boedel van hulle geëis het nie.

■ Pierre du Toit van die prokureursfirma Mostert en Bosman het by navraag gesê Naude het laat weet hy oorweeg dit om ansoek te doen om ’n bevel dat hy sy bankstate moet oorhandig, te laat hersien.

■ Daar is polisgeld van R8 miljoen aan Susan-Ann uitbetaal ná haar man se dood. Die geld word in ’n trust bewaar. Sy kry maandeliks R35 000 van haar swaer om kop bo water te hou, en het nog nie van die rente of die R8 miljoen-kapitaal gebruik nie, luidens getuienis in haar sekwestrasie-ondervraging.

‘Watter geheime draaie ry hy?’

19 Aug

Author: Marelize Barnard

Publications: Die Burger

Date Published : 19 August 2014

KAAPSTAD. – Watter geheime draaie het wyle Herman Pretorius gery voor hy op 26 Julie 2012 eers sy voormalige sakevennoot en daarna homself in die Kaapse middestad geskiet het?

Dít is een van die tergende vrae wat ontstaan het toe Susan-Ann Pretorius, weduwee van Pretorius, Vrydag deur die kurators van haar gesekwestreerde boedel in die Bellville-landdroshof ondervra is.

Op vrae hoe sy deesdae geldelik oor die weg kom, het sy geantwoord dat haar swaer maandeliks R30 000 aan haar gee.

Susan-Ann het Vrydag getuig dat die dag waarop haar man gesterf het, hy aan haar swaer gesê het indien daar iets met hom gebeur, moet die swaer na Susan-Ann en die Pretorius-egpaar se twee seuns omsien.

Pretorius het die dag waarop hy sy eertydse sakevennoot, Julian Wil­liams, in sy kantoor in Kaapstad geskiet het, ’n vergadering met ondersoekers van die afdeling vir finansiële adviseurs en tussengangerdienste (Fais) in sy kantoor in die Tyger-Waterfront in Bellville gehad.

Pretorius het aangedui dat hy na die badkamer gaan, maar het in plaas daarvan weggery van sy kantoor.

Wat gebeur het in die tydperk tot hy Williams geskiet het, is onseker. Dit blyk wel uit Susan-Ann se getuienis dat hy ’n gesprek met haar swaer gehad het.

Sedert Pretorius se dood is ’n lewenspolis van R8 miljoen aan die Penta-trust uitbetaal, wat belê is en waaruit Susan-Ann nog nie geld gebruik het nie.

Op ’n vraag van adv. Almero de Villiers, wat namens die kurators van Preto­rius en Susan-Ann se trusts optree, of sy nie van die R8 miljoen gebruik nie, het Susan-Ann gesê sy kry R30 000 per maand van haar swaer.

Dit is onduidelik wat van Pretorius se testament geword het.

De Villiers het Susan-Ann Vrydag uitgevra of sy kort ná Pretorius se dood na die bank gegaan het om in die veiligheidskassies in ’n kluis na sy testament te gaan soek. Gevra of sy die testament daar gekry het, het sy “nee” geantwoord.

Ponzi king’s estate bringing in millions – but not enough

22 Jul

Sunday Times
20 July 2014
Nashira Davids

http://www.timeslive.co.za/sundaytimes/

About R20-million could be added next month to the kitty being accumulated to compensate 3000 investors who lost a total of R2.2-billion in Herman Pretorius’s Ponzi scheme.
The Cape Town mansion he shared with his wife, Susan, will be auctioned on August 15. With decor reportedly worth R13-million, it is expected to sell about the same as his Hermanus beach villa, which brought in R17.8-million last year.
zpretorius, from the tiny Western Cape village of Piketberg, rose to become a high-flying businessman with a fleet of luxury cars, at least two mansions and millions in his bank account.
But the good life came to a sudden end when he shot dead his business partner, Julian Williams, reportedly after an argument over money, and then turned the gun on himself.
Since then, the full extent of his scam has come to light and the trustees of the fund he ran have been trying to find his assets.
It is not an easy job, because books and other records were not properly kept and no financial statements were compiled, making it difficult to reconstruct business transactions.
What the trustees did uncover was a life of opulence paid for with money invested in his Relative Value Arbitrage Fund Trust.
Much like her husband’s investors, Susan “lost everything”, her lawyer, Etienne Naude, said.
Susan, who is the registered owner of the Welgemoed house, was sequestrated in October last year.
Naude said his client “is saddened about having to lose that house as well”.
According to the auctioneers ClareMart, the cost of the land and the construction of the home totalled about R20-million.
“There have been countless queries from potential buyers,” said a spokesman for the group.
The house has a marble entrance hall, marble counter tops and wraparound marble patio.
It has its own theatre, gymnasium and sauna, and boasts an excellent view and landscaped gardens.
Pretorius’s estate was sequestrated in the High Court in Cape Town last year.
Judge Owen Rodgers found that Pretorius had “attractedlarge sums from gullible members of the public (many of them from country towns in the Western Cape) by promising above average returns of 14% to 25% per annum – the time-honoured method originally made famous in the 1920s by Mr Charles Ponzi”.
Rodgers noted that Pretorius had no income apart from that derived from his investment scheme and that his wife had not worked since 1991.
But they had 10 properties, reportedly worth R116.9-million, and six cars, including an Aston Martin DBS and a Range Rover.
Rodgers remarked that Pretorius’s wife had said that she and her adult sons “know very little about the investment business and cannot be held accountable if it should transpire that Mr Pretorius acted unlawfully”. Other properties sold include: A luxury three-bedroom apartment in Claremont that fetched R3.3-million; A luxury beach villa in Hermanus – featuried on the cover of House and Leisure magazine in 2012 – scooped up for R17.85-million; Vacant land in Hermanus, auctioned for R 863 840; and “A-Grade” office space at the TygerWaterfront with 51 parking bays, sold for R14.9-million.
They also owned a property in Oranjezicht, vacant land in Wesfleur and a holiday home in Malgas were also on the list of sales.
Piet Serdyn, 73, of Moorreesburg, said he lost all his retirement savings when he invested with Pretorius shortly before his suicide.
He has little hope of getting any of his money back.
All we, as investors, can do is sit and wait. There is nothing we can do about it.

Pretorius: Makelaar moet geld teruggee

10 Jul

Author: Marelize Barnard

Publications: Die Burger

Date Published : 10 Mei 2014

KAAPSTAD. – ’n Makelaar wat beleggers na wyle Herman Pretorius se beleggingskema gelok het, moet R500 000 plus rente terugbetaal aan een van dié beleggers.

Die ombudsman vir finansiële adviseurs en tussengangers (Fais), Noluntu Bam, het ’n bevel gemaak dat die makelaar van Bellville, Michal Calitz, en sy beslote korporasie, Impact Finansiële Konsultante, die R500 000 en rente van 15,5% per jaar moet terugbetaal.

Die klaer in die saak, Craig Inch, het jare lank pensioengeld bymekaargemaak en dit op Calitz se aanbeveling in Pretorius se Rela­tive Value Arbitrage Fund (RVAF) belê.

Inch se geld was vantevore in die geldmark belê en hy het dit nooit oorweeg om dit in ’n verskansingsfonds te belê nie.

Volgens Inch se weergawe in sy aansoek by Fais het Calitz hom verseker dat dit ’n stabiele fonds is en Inch se geld is op 30 Maart 2010 by RVAF inbetaal.

Hy wou op 26 Julie 2012 sy geld onttrek, maar het ’n dag later uitgevind dat Pretorius dood is.

Preto­rius het op 26 Julie 2010 selfmoord gepleeg nadat hy ’n oudkollega, Julian Williams, doodgeskiet het.

In die Fais-ombudsman se uitspraak word genoem dat Calitz aangevoer het dat hy nie verantwoordelikheid kan aanvaar vir wat blyk die “doelbewuste poging van een persoon was om beleggers te bedrieg nie”.

Verder word genoem dit is kommerwekkend dat Inch se geld reeds op 30 Maart 2010 in die RVAF Trust se bankrekening inbetaal is, terwyl ’n ooreenkoms daaroor eers op 7 April onderteken is. Die belegging is gemaak “voor enige dokumente onderteken is”.

Bam het verder gesê daar is geen bewyse deur Calitz gebied dat die ware risiko aan Inch verduidelik is nie.

“Nóg Pretorius nóg die RVAF was gelisensieer . . . Calitz moes geweet het dat die Fais-wetgewing nie nagekom is nie.”

Verder is daar geen behoorlike boekhouding of rekords deur Pretorius gehou nie. Dit is ’n belangrike kwessie wat Calitz nie kan verduidelik om te bewys dat hy ’n behoorlike ondersoek na die RVAF se sake gedoen het nie.

“Dit is duidelik dat Calitz blindelings aanvaar het wat aan hom gesê is oor die RVAF, want hy het beslis nooit die moeite gedoen om navraag te doen oor die finansiële state wat nooit bestaan het nie,” lui Bam se uitspraak.

‘Hedge fund’ advice slammed

22 Jun

Author: Angelique Arde

Publications: iOL

Date Published: 22 June 2014

The Ombud for Financial Services Providers has handed down a scathing determination against a financial planner who placed R500 000 of his client’s savings in the Relative Value Arbitrage Fund (RVAF), which was a scam posing as a hedge fund.

The RVAF collapsed after the architect of the scam, Herman Pretorius, reportedly shot his former business partner and then himself in July 2012.

The determination handed down by ombud Noluntu Bam this week reveals that adviser Michal Calitz of Impact Financial Consultants in Bellville, Western Cape, earned R8.4 million in so-called share profits from the RVAF, “yet on the objective evidence he could not have conducted even the most basic due diligence [tests] on the RVAF”.

Calitz placed his client’s funds in a scheme which did not have a financial services provider number, nominee account or even audited financials, Bam’s determination states.

“Schemes such as the RVAF cannot exist without professionals such as Calitz turning a blind eye to legislative requirements,” Bam says.

Calitz holds a post-graduate diploma in financial planning and is a member of the Financial Planning Institute (FPI). This entitles him to call himself a Certified Financial Planner (CFP). He was certified to a standard above that of the average financial adviser and “must be held to that standard”, Bam says.

The ruling follows a complaint by a dentist, Dr Craig Inch, who became Calitz’s client because a friend had recommended him.

According to the ruling, Inch’s friend had told him about a hedge fund that had been performing well, and the dentist asked Calitz about it or others of a similar ilk. Calitz said he did know about it, and mentioned the RVAF.

Not knowing much about hedge funds other than that they can be risky, Inch asked Calitz to explain the fund. Calitz replied that the fund manager was a gentleman he knew very well and that the fund used a technique involving long-short strategies.

When Inch asked about the risks of losing capital due to poor decision-making by the fund manager, Calitz said that although this was possible, the fund had done consistently “very, very well” and provided a return of 20 percent a year without much deviation.

Calitz explained that hedge funds are not regulated in the way that unit trust funds are, but that this fund has “all the correct paperwork”.

Bam says the RVAF had no paperwork by way of registration or licence whatsoever, and in that regard was conducting business illegally.

With all his savings (R600 000) in a money market fund, Inch was not willing to invest his capital with a high risk of loss. But Calitz assured him that the fund was not influenced by market fluctuations. Furthermore, not only had many of his clients invested in the RVAF, but so too had he. Based on this assurance, Inch deposited R500 000 into the RVAF’s bank account on March 30, 2010, the ruling says.

On July 26, 2012, Inch instructed Calitz that he wanted to withdraw R600 000. The following morning, he heard of the death of Pretorius, “the fund manager and trustee of the RVAF”.

The RVAF is in liquidation, and the trustees have indicated that some, if not all, investor funds have been lost. Bam’s ruling says that in a letter dated November 2012, Calitz wrote: “It is presumed that Dr Inch’s funds are lost, although no definite finding has been made by the liquidators.”

Inch told the ombud he trusted Calitz because he is a CFP and his company is registered with the Financial Services Board (FSB). This led him to believe that the product he was investing in was legal and registered, that Calitz had done the necessary due diligence, that the fund manager was licensed with the FSB, that there were valid financial statements and that the fund was audited.

“This is not the case at all. Had I known this, I would never have invested a cent in this fund,” Inch told the ombud. Calitz acted unethically by investing his money in this “hedge fund”, he says.

In response to questions from Bam’s office, Calitz did not provide evidence of having done a financial needs analysis, justifying investing Inch’s savings in a hedge fund, “which is high risk”, or a record of advice, to explain what other products were considered.

Bam says while Calitz supposedly had the qualifications and experience, “he either failed to properly understand what he was dealing with, or, more worryingly, turned a blind eye in favour of lucrative commission, which he received from the RVAF” .

Bam says Calitz ignored the very legislation designed to protect his client, which led to his client’s loss, and ordered him and his company pay Inch R500 000.

Bam’s office has also referred the determination to the FPI.

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Belegger sterf aan hartaanval

2 May

Author: Marelize Barnard

Publications: Die Burger

Date Published : 02 Mei 2014

KAAPSTAD. – ’n Sewentigjarige belegger wat met wyle Herman Pretorius se bedrogspul al sy spaargeld vir mediese uitgawes verloor het, is oorlede kort voor hy vrae oor sy beleggings moes beantwoord.

Die likwidateurs van Preto­rius se Relative Value Arbi­trage Fund (RVAF) Trust en die Seca Trust is tans ingevolge regulasies van die Insolvensiewet met geheime ondervragings van beleggers besig.

Die seun van die man wat verlede week aan ’n hartaanval gesterf het, het vertel hoe sy pa die afgelope twee jaar gely het onder die wete dat al die geld wat hy vir hom en sy vrou se mediese onkostes op hul oudag gespaar het nou verlore is.

“Pretorius het soveel mense se lewe verwoes. Herman het alles wat my pa gehad het, gevat,” het die seun gister gesê. Die seun het gevra dat nóg sy naam nóg dié van sy pa gepubliseer word.

Die seun moes verlede week inderhaas van Pretoria na Kaapstad vlieg ná sy pa se hartaanval.

“Hierdie ou (Pretorius) het net soveel lewens verwoes. Die stres wat my pa die afgelope twee jaar gehad het, was geweldig. Dit het die hele tyd in sy kop gemaal dat hy dinge weer moet probeer regkry.”

Die oorledene se een groot vrees was dat daar op sy oudag nie genoeg geld sou wees vir die mediese onkostes van hom en sy vrou nie.

“My pa het 20 jaar lank dieselfde kar gery. Hy het geld by Pretorius belê om te spaar vir sy oudag. Hy was nie gierig nie.

“En só is daar mense in Riversdal en Riebeek-Kasteel . . . Dit is mense wie se hele lewe – soos my pa s’n – die afgelope twee jaar oorheers is deur stres. Dit is stres waarmee jy gaan slaap en opstaan. Dit gaan deur jou kop as jy eet of gaan stap.”

Pretorius, wat R2,2 miljard van beleggers ingevorder het in ’n piramideskema, het op 26 Julie 2012 ’n voormalige sakevennoot, Julian Williams, in die middestad van Kaapstad doodgeskiet en daarna selfmoord gepleeg.

In ’n kennisgewing aan beleggers waarin die redes vir die likwidateurs se insolvensie-ondersoek uiteengesit word, word genoem dat die Insolvensiewet daarvoor voorsiening maak dat enige persoon ondervra kan word wat moontlike inligting of dokumentasie het met betrekking tot die insolvente boedel wat ondersoek word.

Pretorius het, volgens die kennisgewing, nie behoorlik boekgehou nie en die likwidateurs beskou die geheime ondervraging van getuies as noodsaaklik om inligting te bekom

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Herman Pretorius’s widow loses sequestration battle

24 Jan

Author: Julius Cobbett

Publications: MoneyWeb

Date Published: 24 January 2014

Leave to appeal sequestration order is denied.

JOHANNESBURG – The widow of Ponzi mastermind Herman Pretorius has lost another battle in the bid to stop her own sequestration. Last week Susan Pretorius applied for leave to appeal a final sequestration order granted against her estate. The order was handed down by acting Judge Wilhelm van Staden last year.

On Thursday January 23 Van Staden dismissed Susan Pretorius’s application for leave to appeal. Van Staden concluded that an appeal had no reasonable prospect of success.

The application to sequestrate Susan Pretorius’s estate was brought by the trustees of the RVAF and Seca trusts, entities that received money from Pretorius’s investors.

Herman Pretorius’s scheme collapsed in July last year. Faced with investor withdrawals he couldn’t meet, Pretorius shot his former business partner Julian Williams before turning the gun on himself. The investment scheme received an estimated R2.2bn from about 3000 investors.

Last week Susan Pretorius denied that she was insolvent. She claimed the court had erred in holding that she was not the beneficiary of a life insurance policy worth R8m. However, Van Staden said that Pretorius had an opportunity to present further evidence on or before the return day.

Van Staden ordered that the costs of the application for leave to appeal, including the costs of two counsel, be costs in Susan Pretorius’s sequestration.

The curators of Herman Pretorius’s RVAF are still struggling to trace investor money, including funds that were moved to UK and Switzerland.

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Pretorius moet sê oor interdik

21 Aug

Author: Marelize Barnard

Publications:  Die Burger

Date Publiched: 21 Augustus 2013

KAAPSTAD. – Het Herman Pretorius se weduwee geweet dat ’n interdik verontagsaam word toe miljoene rande se aandele ná haar man se dood verkwansel is om haar eie regskostes te betaal?

Dit is die vraag wat Susan-Ann Pretorius moet beantwoord wanneer sy vandag ’n sekwestrasie-aansoek teen haar in die Wes-Kaapse hooggeregshof beveg. Haar regspan kan dalk lig werp oor die bewering dat ’n groot getal Wesizwe-aandele verkoop is ten spyte daarvan dat dit strydig kon wees met ’n hofbevel.

Lambertus von Wielligh Bester van Progressive Administration, ’n mede-kurator van Pretorius se beleggingstrust (Relative Value Arbitrage Fund), voer in ’n beëdigde verklaring aan dat aandele verkoop is nadat ’n interdik op 9 Oktober verlede jaar verkry is wat Susan-Ann verhinder om enige bates te vervreem.

Maar Susan-Ann voer in haar beëdigde verklaring aan dat die opbrengste uit die verkoop ………

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AUCTION ACHIEVES ‘EXCEPTIONAL RESULTS’

18 Apr

Author: Hedda Mittner

Publications: Hermanus Times

Date Publiched: 18 April 2013

Bidding was brisk when the luxury seafront holiday home and nearby vacant erf of the late businessman Herman Pretorius was auctioned on site in Voëlklip on Friday 12 April.

Infamous for his involvement in the investment schemes that saw many South Africans, including locals from Hermanus, losing millions of rands, Pretorius first shot and killed his business partner Julian Williams before committing suicide in July 2012.

The properties that were auctioned are owned by one of Pretorius’s companies, Hentiq 1803, which was liquidated in the Western Cape High Court in December last year.

Situated at 79 Tenth Street in Voëlklip, the house came under the hammer along with its contents, followed by the auction of the vacant erf at 80 Tenth Street.

There had been a considerable amount of interest in the properties and the open days ……

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Investors need to wise up to Ponzi schemes

24 Jan

Author: DAWIE DE VILLIERS

Publications: iOL

Date Published: 24 January 2013

With many South Africans – and retirees, in particular – struggling to make ends meet, they become easy pickings for fraudsters operating get-rich-quick investment scams, also known as Ponzi schemes.

In their search for high returns on investments, South Africans seem to repeatedly entrust their hard-earned savings to operations which, at best, have short-term track records and, at worst, knowingly sell promises that they are unable to deliver on.

Investors buy into these promises without fully understanding how these operators achieve their alleged returns.

Over the past five years, the following schemes – which have had traumatic consequences for unsuspecting investors – come to mind: Fidentia, Leaderguard, Sharemax, King Group, and the Herman Pretorius saga.

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‘FSB needs more powers to stop bad behaviour’

18 Nov

Author: Bruce Cameron

Publications: iOL

Date Published: 18 November 2012

…….. Momoniat also wants the FSB to be allowed to make on-site visits to unregulated entities that could be operating unlawfully.

(Recently, the FSB did not take pre-emptive action against asset manager, Herman Pretorius who ran a R1.8-billion Ponzi scheme, which has since collapsed, because the FSB  said it was an unregulated product and did not have the powers to intervene. Pretorius fatally shot himself and an associate, Julian Williams, when the FSB did eventually take action.)

Momoniat says he is particularly concerned about how people such as J Arthur Brown in the Fidentia case and Simon Nash (executive chairman of appliance company Cadac) “abuse the legal system to delay their trials”, and also attempt to discredit the regulators in an effort to reduce the charges against themselves……….

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Curators struggle to trace Herman Pretorius’s Ponzi billions

16 Oct

Author: Julius Cobbett

Publications: MoneyWeb

Date Published: 16 October 2012

Less than R300m of estimated R2.2bn traced; family served with Anton Piller order.

JOHANNESBURG – Curators for Herman Pretorius’s investment scheme are struggling to track the billions he solicited from investors.

On July 26 Pretorius shot his former business partner Julian Williams before turning the gun on himself. Evidence emerged after his death that confirmed suspicions that Pretorius had been running a massive Ponzi scheme called the Relative Value Arbitrage Fund (RVAF).

RVAF curators estimate that the scheme received R2.2bn from about 3000 investors. At the time of Pretorius’s death, the RVAF owed an estimated R3.1bn to investors.

The difference between the amount received and owing is most likely explained by the fund’s performance ………

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SA fund manager faces big losses in Herman Pretorius fallout

3 Oct

Author: Julius Cobbett

Publications: MoneyWeb

Date Published: 03 October 2012

JOHANNESBURG – Two Mauritius-based funds, managed by a South African, face big losses as a result of the Herman Pretorius homicide. On July 26 Herman Pretorius shot dead his former business partner, Julian Williams, and then himself. It was later revealed that Pretorius had been operating a R3.1bn Ponzi scheme.

Williams was CEO of private-equity company Basileus Capital. He was also associated with JSE-listed BK One, which has its entire R200m portfolio invested in four Basileus-related companies. The homicide created problems for BK One, because Williams played a key role in its investments.

Already one of BK One’s four investments, Tor Construction, has been placed under provisional liquidation as a result of the shooting. BK One has since proposed an injection of various Basileus assets as part of a business rescue plan.

The biggest investor in BK One is a Mauritius-registered fund called ………

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Plaaslike beleggingsadviseur reageer

23 Sep

Author: Unknown

Publications: George Herald

Date Published: 23 September 2012

GEORGE NUUS – Die George Herald het verlede week berig oor tientalle mense in George wat deur middel van die plaaslike finansiële adviseur en belegger, Fouché Meyers miljoene rand in die rampspoedige Relative Value Arbitrage Fund belê het en heel moontlik al hulle beleggingsgeld sal verloor.

Die finansiële bom het ge-sbars toe die ‘meesterbrein’ agter die fonds, Herman Pretorius op 26 Julie dood is na hy glo homself en ‘n voormalige sakevennoot, Julian Williams in Kaapstad doodgeskiet het.

Fouché Meyers het twee weke gelede ‘n afspraak met die George Herald gekanselleer en ook nagelaat om e-posnavrae te beantwoord.

Dinsdagmiddag het hy die George Herald se kantore besoek met die versoek dat ons ‘n ope brief van hom aan die gemeenskap publiseer waarin hy sy kant van die saak stel. Hy het ook gesê dat geen van sy bates ooit in die naam van die RVAF Trust geregistreer was nie.

Die George Herald het verlede week verkeerdelik berig dat sy boot se sleepwa in die naam van RVAF gerigistreer is. Ons het verkeerde inligting van die outoriteite ontvang ………

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How do you know it is a ponzi scheme?

17 Sep

Author: Maya Fisher-French

Publications:  mayaonmoney.co.za

Date Publiched: 17 September 2012

The recent Western Cape Relative Value Arbitrage Fund (RAVF) scandal that led to suicide shooting of Julian Williams by his associate, Herman Pretorius, is estimated to have lost investors around R1.8 billion. While investors, and financial advisers who recommended the fund, throw up their hands and say “how could we have known”, the simple investment rule is that when returns promised are too good to be true – they usually are.

“If the product sounds too good to be true, it usually is. One common characteristic of a scam is guaranteed high returns for example guaranteeing 30% per cent returns, this should ring an alarm as it is not realistic,” says Paul Roelfse from the Financial Planning Institute (FPI).

When an investment promises any return above cash, the first question you need to ask is: what is it ……

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George-inwoners vrees miljoene is weg

13 Sep

Author: Unknown

Publications: George Herald

Date Published: 13 September 2012

GEORGE NUUS – Tientalle George-inwoners wat deur ‘n plaaslike finansiële adviseur, Henry Fouché Meyers miljoene rande in die nou berugte Relative Value Arbitrage Fund (RVAF) belê het, vrees al hulle geld is daarmee heen.

Groot probleme met die fonds het aan die lig gekom nadat die fonds se meesterbrein, Herman Pretorius homself en sy voormalige vennoot Julian Williams op 26 Julie in Kaapstad doodgeskiet het.

Miljarde beleggingsrande is moontlik daarmee heen nadat die fonds onder sekwestrasie geplaas is en die George Herald is bewus van meer as R20 miljoen wat deur plaaslike beleggers in RVAF belê is. Die bedrag kan egter baie hoër wees aangesien ………

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Honderde verloor werk

12 Sep

Author: Jackie Kruger

Publications:  Die Burger

Date Publiched: 12 September 2012

HARTENBOS. – Die skietdood van die sakemanne Herman Pretorius en Julian Williams het die ekonomie van Mosselbaai ’n gevoelige slag toegedien.

Sowat 800 mense het hul werk verloor as gevolg van die twee se dood in Julie en die gevolglike verbrokkeling van hul sakeryk.

Die posisie van die 800 het in die gedrang gekom nadat ’n aansoek om likwidasie teen die konstruksiemaatskappy Tor Construction gebring is deur Tor Holdings, ’n entiteit van die beleggingsmaatskappy Basileus.

Ten tyde van ’n besoek van Die Burger aan Tor Construction ………

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Fund’s lucky escape from Herman Pretorius fallout

12 Sep

Author: Julius Cobbett

Publications: MoneyWeb

Date Published: 12 September 2012

Fund sold its entire stake in listed Julian Williams entity on the day he was shot.

JOHANNESBURG – Fund manager Ankh Analytic sold its entire stake in BK One on the day Basileus Capital CEO Julian Williams was shot.

The sale was a very lucky escape for Ankh, because BK One’s portfolio consists of four Basileus-related companies. One of these companies, Tor Construction, has already been placed under provisional liquidation in the fallout of Williams’s death. The remaining three ………

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Your pension choice a worry for govt

2 Sep

Author: Bruce Cameron

Publications: iOL

Date Published: 2 September 2012

Questions about FSB’s scam control

The Financial Services Board (FSB) could soon find itself being grilled by Parliament for not being more effective in curtailing scams that recur with alarming regularity, with losses of billions of rands of the savings of consumers, including retirement fund members and pensioners, who fall prey to the schemes.

And National Treasury concedes that the FSB is not doing enough to protect you.

The latest scam to hit the headlines was the high-drama collapse of a Ponzi scheme masquerading as a hedge fund, the Relative Value Arbitrage Fund (RVAF).

The scamster, Herman Pretorius, shot his business associate, Julian Williams, during an altercation, before turning the gun on himself following a belated FSB raid more than a year after the scam was first reported to it.

The roughly 3 000 investors in RVAF, most of whom are from the Western Cape, invested about R2 billion in the scheme. Once again, many are pensioners, who now face destitution because their money went into a high-return, extremely high-risk, unregulated “investment”.

Personal Finance asked the FSB to investigate the scheme in May last year, and the FSB merely accepted replies given to it as fact, allowing what amounted to a gigantic Ponzi scheme to continue operating under its nose. (A Ponzi scheme uses the capital of the most recent investors to pay out high returns to earlier investors, who, in turn, spread the word about the “fantastic” returns.)

After the bubble burst, the FSB attempted to justify its laxness by making a claim to the effect that Pretorius was virtually exempt from FSB action because the product he was flogging was not subject to regulatory oversight.

Cope MP Nick Koornhof raised the issue at parliament’s finance committee meeting this week, asking how the FSB will be transformed in line with government’s twin-peak policy where all market conduct of financial institutions will be placed under the control of the FSB.

“How long must we wait for it? There have been so many tragedies since Fidentia. How long must we wait for real action, for the FSB to have all the teeth it needs?” he asked.

Koornhof told Personal Finance that he will raise the issue again next week with the committee and ask for a special meeting to call the FSB to account.

His concerns were echoed by Ismail Momoniat, deputy director-general of the National Treasury, who told the committee he believed the FSB has sufficient legislative teeth. The problem, he said, is how the teeth are used.

He candidly admitted that the FSB should have picked up on some of the attacks on retirement funds and other scams.

However, Momoniat says, ways have to be found of dealing with campaigns to vilify the FSB and others by parties such as Arthur Brown, who faces criminal charges relating to the implosion of Fidentia, and Simon Nash, who is facing criminal charges arising from the alleged illegal removal of pension fund surpluses in the 1990s.

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100de werkloos na besigheid gelikwideer

31 Aug

‘n Lugfoto van Tor Konstruksie se geboue buite Hartenbos.

Author: Louise Karsten

Publications: Mosselbay Advertiser

Date Published: 31 August 2012

MOSSELBAAI NUUS – Ongeveer 800 werknemers van die padboubesigheid, Tor Konstruksie, sit sonder inkomste nadat die maatskappy vroeër die maand noodgedwonge sy deure moes sluit. Dié getal sluit permanente en tydelike werknemers in.

Die direkteur van die maatskappy, mnr André van den Heever, sê Tor se deure is gesluit weens van die afsterwe van die besturende direkteur, Julian Williams, van die private ekwiteit groep Basileus Capital. Williams is einde Julie vermoedelik deur sy voormalige sakevennoot, die miljoenêr-sakeman, Herman Pretorius (55), doodgeskiet. Tor is een van vier maatskappye ………

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BK One to take part in Basileus Capital rescue

29 Aug

Author: Donwald Pressly

Publications: iOL

Date Published: 29 August 2012

BK One is poised to acquire a majority stake in various Basileus Capital businesses including a cash management services firm, prospecting rights, oil and agri-technology operations.

In an announcement yesterday, BK One announced its proposed acquisition of Basileus Capital’s interests “in select assets and renewal of a cautionary announcement”. This follows an announcement two weeks ago by Basileus Capital that it had initiated business rescue proceedings, following the killing of chief executive and co-founder Julian Williams allegedly by his former business partner Herman Pretorius on July 26. Pretorius turned the gun on himself afterwards.

Moneyweb reported that Basileus Capital was seeking to have its assets listed on the JSE through BK One. Private equity provider BK One’s preference shares are listed on the JSE but its ordinary shares are not. It is not clear whether the proposed transaction would be funded with ordinary shares or preference shares.

In terms of the rescue process, a majority of the affected creditors must approve the rescue plans.

BK One was launched by Basileus Capital and Kwanda Capital Investments. It raised R200 million in an initial public offering on the JSE after offering 20 million preference shares at R10 a share in December last year.

Three weeks after its chief executive’s death, Basileus Capital, which employs about 50 people, announced on its website that following “the tragic loss of Julian Williams… the board… has initiated business rescue proceedings”. “This measure was taken in order to protect all existing stakeholders, in particular the group’s current creditors, investors and staff.”

BK One reported yesterday that it would acquire “the target assets” from Basileus Capital subject to a number of conditions and the purchase consideration “will equal 90 percent of the value of the target assets”, as determined by the business rescue practitioners and confirmed by an independent valuer appointed by BK One.

There are seven target assets, three of which BK One already has an interest in.

n BK One currently has a 7.7 percent interest in Pure Ocean Aquaculture, a fish-farming firm. It seeks a further 86.3 percent interest, which is held by Basileus.

n Basileus Capital intends disposing of its 76 percent interest in physical cash management services firm Cash Connect to BK One.

n BK One seeks to acquire Basileus Capital’s 77 percent interest in Kawuleza Connect, which offers internet access services to customers throughout South Africa.

n BK One seeks to acquire Basileus Capital’s 98 percent interest in Lefatse Minerals, which is involved in the exploration and development of heavy minerals. It has prospecting rights over a deposit on the West Coast.

n BK One seeks to acquire Basileus Capital’s 94 percent interest in Burgan Oil Services, which is looking to develop fuel infrastructure facilities.

n BK One seeks Basileus Capital’s 100 percent interest in Tor Oil Infrastructure Construction, a new oil infrastructure development specialist.

n BK One will acquire Basileus Capital’s 82 percent interest in Agri-Technologies and Services, which provides technology solutions to the agricultural sector.

BK One noted that depending on the settlement mechanisms of the proposed acquisition – BK One ordinary or preference shares – the company “may be required to restructure its share capital”. This would require shareholder and JSE approval.

BK One executive director Dean Richards could not be drawn on a transaction price, but this would be determined by business rescue practitioner Alan Rennier of Ren Trust and independent valuers.

It is understood that existing Basileus staff will be absorbed and new staff will also be appointed.

Dead scammer’s trusts sequestrated

25 Aug

Author FATIMA SCHROEDER

Publications: iOL

Date Published: 25 August 2012

Cape Town – Two trusts linked to businessman Herman Pretorius, who shot dead his former business partner, Julian Williams, and then turned the gun on himself at a Foreshore office block on July 26, were provisionally sequestrated after two separate applications in the Western Cape High Court this week.

The applications come just more than three weeks after Pretorius’s Relative Value Arbitrage Fund (RVAF) was sequestered …..

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Death of Julian Williams causes liquidation threat for JSE investors

23 Aug

Author: Julius Cobbett

Publications: MoneyWeb

Date Published: 23 August 2012

director James Ngculu seeks liquidation of a BK One investment.

JOHANNESBURG – Basileus Capital director, James Ngculu wants an investment of JSE-listed BK One declared insolvent. Ngculu is a former ANC member of parliament and the right-hand man of the late Basileus CEO Julian Williams.

Ngculu drafted an affidavit calling for the liquidation of road-building business Tor Construction. Tor Construction is one of four companies …..

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PwC helped Herman Pretorius sell his R1.8bn fund

20 Aug

Author:  Julius Cobbett

Publications: MoneyWeb

Date Published: 20 August 2012

Audit firm admits to “facilitating” meetings but denies recommending Pretorius’s scheme.

JOHANNESBURG – Audit firm PricewaterhouseCoopers “facilitated” investment meetings held by the late Herman Pretorius. Before his death Pretorius had been operating an unorthodox investment scheme called the Abante Relative Value Arbitrage Fund (RVAF). This fund, which took the form of a trust, was provisionally sequestrated by the Western Cape High Court on August 1. The fund is believed to owe R1.8bn to 3 000 investors.

A number of readers have contacted me claiming that PricewaterhouseCoopers (PwC) was involved ……..

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Deaths expose troubled business at Basileus Capital

17 Aug

Author: LIONEL FAULLSAM SOLE

Publications: M&G

Date Publiched: 17 August 2012

Deaths expose troubled business at Basileus Capital

Investigations have suggested that Basileus Capital was already treading water before the death of Julian Williams.

The empire of slain businessman Julian Williams appears poised for collapse, following the announcement that his Basileus Capital group has initiated “business rescue proceedings”.

Business rescue is an alternative to liquidation provided for under the updated …………….

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Basileus seeks business rescue after death of CEO Julian Williams

14 Aug

Julian Williams

Author: Julius Cobbett

Publications: Moneyweb

Date Publiched: 14 August 2012

Business rescue includes SA Superalloys which owes R140m to 500 investors.

JOHANNESBURG – Basileus Capital, a private-equity firm that employs nearly 50 people, has initiated business rescue proceedings. This comes nearly three weeks after the death of Basileus CEO Julian Williams. It is believed that Williams was shot dead by his former business partner Herman Pretorius, who committed suicide afterwards.

The initiation of a business rescue is the second act of insolvency to result from the murder. Less than a week after the ………..

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Hawks to probe trust owing as much as R1.8bn

14 Aug

Author: Unknown

Publications: iOL

Date Publiched: 14 August 2012

The Directorate for Priority Crime Investigation (Hawks) will probe a Cape Town trust that may owe investors up to R1.8 billion, according to court documents. The RVAF Trust was run by Herman Pretorius, who police believe shot himself dead after gunning down former business partner Julian Williams in July. “A criminal inquiry will be opened after documentary evidence and/or affidavits from the liquidator and/or investors have been received,” police spokesman Captain Dennis Adriao …………..

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Activities ‘not unlawful’

13 Aug

Author:  Staff Reporter

Publications:iOL

Date Published:  13  August 2012

The business dealings of Herman Pretorius, one of two businessmen who died in a central Cape Town shooting last month, was red-flagged as far back as May last year, the Financial Services Board (FSB) has reported.

Pretorius and Julian Williams, 37, a chief executive of Basileus Capital, were found dead in an office in the Icon building on the Foreshore on July 26. Williams was shot in the neck and stomach. Pretorius had a bullet wound to the head. A 9mm pistol was found at the scene.

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Suss investments before buying

12 Aug

Author: Maya Fisher-French and Liziwe Ndalana

Publications:  City Press

Date Publiched: 2012-08-12

It is imperative to be wary of the risk you may be taking on your returns when investing, write Maya Fisher-French and Liziwe Ndalana
The recent Relative Value Arbitrage Fund (RVAF) scandal in Western Cape that led to the suicide shooting of Julian Williams by his associate, Herman Pretorius, is estimated to have lost investors about R1.8 billion.
While investors and advisers who recommended the …………

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Details Emerge About HF Manager’s Murder-Suicid

9 Aug

Author: Jing Chen

Publications:   eVestment

Date Publiched: 09 August 2012

What prompted a South African hedge fund manager to shoot his former business partner to death before turning the gun on himself?
Forbes reported that Herman Pretorius killed Julian Williams on July 26 after Pretorius was visited by South African regulators at his office regarding his Relative Value Arbitrage Fund. His hedge fund had been under scrutiny by South Africa’s Financial Services Board for a few months following an article in a South African publication questioning the fund’s ………

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ONDERSOEK NA RVAF-TRUST BEGIN

9 Aug

Author:  Charlotte Lesch

Publications:Boland Gazette

Date Published:  09 August 2012

MALMESBURY Beleggers in die wyle Herman Pretorius se gesekwestreerde beleggingstrust gaan glo nog lank wag voor hulle meer duidelikheid het oor waar hulle geld belê is.

Die verskanningsfonds, die Relative Value Arbitrage Fund (RVAF-trust), het die afgelope tyd groot opspraak gemaak nadat Pretorius vermoedelik eers ’n voormalige vennoot, Julian Williams, en daarna homself doodgeskiet het.

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Murder-Suicide at Center of Potential $245 Million South African Ponzi Scheme

8 Aug

Author:  Jordan Maglich,

Publications: Forbes

Date Published: 08 August 2012

A South African fund manager is dead, along with a former business partner, in an apparent murder-suicide after questions mounted over the legitimacy of his hedge fund and South African financial regulators opened an investigation. After a visit by South Africa’s Financial Services Board (“FSB”) regarding his Relative Value Arbitrage Fund (“RVAF”), Herman Pretorious allegedly then shot and killed Julian Williams at Williams’ private equity firm, Basileus Capital, in Cape Town, South Africa.  Many ominous details about RVAF have since emerged, with authorities suspecting that Pretorious may have operated a massive Ponzi scheme with investor losses approaching up to $250 million.

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Hedge Fund Murder Suicide – Julian Williams Shot By His Partner Update

5 Aug

Author: Hedgehottie

Publications: hedgeho.com

Date Published: 05 August 2012

Julian Williams was shot by his partner Herman Pretorius who shot himself after.  Williams was in a business dispute with Herman Pretorius, an investment manager of an unregulated asset management firm called Relative Value Arbitrage Fund.  Pretorius turned the gun on himself after shooting Mr. Williams. Hedge fund murder suicide –  as friends fall out

Williams and Mr. Pretorius were involved in a company called SA Superalloys. The company had stopped paying dividends earlier ………

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Julian Williams CEO of Basileus Capital on private equity in South Africa

1 Aug

http://www.youtube.com/watch?v=BzOPczqg9gE

A Private Equity CEO Was Shot Dead In His Office

27 Jul

Julia La Roche

Author:  Julia La Roche

Publications: Clusterstock

Date Published: 27  July  2012

The CEO of private equity firm was allegedly shot dead by a former business partner who then killed himself, MoneyWeb’s Julius Cobbett reports.

The CEO was Julian Williams, 37, the chief executive and co-founder of Basileus Capital.

He was allegedly shot by  Herman Pretorius, a former business partner at hedge fund Abante Statistical Arbitrage.

MoneyWeb points out that the pair had a big dispute earlier this month over the payment of dividends for a company called SA Superalloys.

Here’s Williams’ bio from Basileus:

Julian Williams graduated with a Masters in Commerce from the University of Cape Town. He successfully completed his board examination and following the completion of his training contract with PriceWaterhouseCoopers Inc, he obtained his CA (SA) professional membership from the South African Institute of Chartered Accountants.

In Business:

In 2001 he was responsible for launching Penryth (Proprietary) Limited, a specialist securities lending business in South Africa. This led him to move across and establish an investment Group of companies which comprised: a Financial Services Board registered investment manager; and a private equity company and related companies.

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SASUPERALLOYS – Letter to Pref Shareholders

1 Jun

Letter to Pref Shareholders

Julian Williams CEO of Basileus Capital on private equity in South Africa

31 Jan

JUDGMENT (2007)

31 May

Case no: 380/06

Not reportable

In the matter between

HERMANUS DEMPERS PRETORIUS NO 1 ST APPELLANT

SUSAN ANN PRETORIUS NO 2 ND APPELLANT

EDUARD BRAND NO 3 RD APPELLANT

and

STANLIB WEALTH MANAGEMENT LIMITED RESPONDENT

Coram: SCOTT, BRAND, LEWIS, COMBRINCK JJA, and THERON AJA

Heard: 18 May 2007

Delivered: 31 May 2007

Summary: Oral contract to invest in respondent’s investment fund established

by evidence: representative of respondent had authority to bind it.

Neutral citation: This case may be cited as

Pretorius NO v Stanlib

Wealth Management Ltd [2007] SCA 77 (RSA)

[1] The appellants are the trustees of two trusts, the Seca Trust (Seca)

and the Tableau Trust (Tableau). They instituted action in the Cape High

Court against the respondent, Stanlib Wealth Management Ltd (Stanlib), for

the payment of R5m, which they alleged had been invested on behalf of the

trusts (R2.5m each) with Stanlib, and which was repayable on demand. Only

the first appellant, Mr Hermanus Pretorius, played a role in the litigation.

Stanlib, at the time the investments were made, was called Liberty

Specialised Investments (Pty) Ltd and was a wholly owned subsidiary of

Liberty Life Group Ltd (Liberty). I shall refer to Stanlib rather than to Liberty

Specialised Investments for the sake of convenience.

[2] Griessel J in the high court granted judgment in favour of the

appellants, interest

a tempore morae and the costs of two counsel. The basis

of his decision was that agents of the parties had concluded an oral

agreement in terms of which moneys ……..

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