Director’s passport blocked amid efforts to recover Classic’s assets

The passport of the director of Classic Financial Services One (Pty) Ltd – an unlicenced investment company under criminal investigation – has been blocked to prevent him from fleeing South Africa.

In a letter sent to “all affected parties” on 27 July, PBP Administrators, the provisional liquidator appointed to oversee and track down the assets of Classic, said they received information that the director, Jacobus Stephanus Geldenhuis, allegedly intended to flee the country.

“We immediately took the required and appropriate steps to ensure that his passport was blocked to prevent him from same,” wrote PBP curator Jaco Venter.

Classic was wound up (liquidated) by order of the High Court in Pretoria on 30 May.

According to Venter, since then PBP has been working “to thoroughly consider and comprehend the myriad of documentation and digital information received and obtained from various sources and electronic devices”.

The liquidator also confirmed it has held the first statutory meeting with Geldenhuis, “to assist in obtaining a clear and concise understanding into the trade dealings” of Classic.

“We have been diligent and dedicated in our efforts to recover assets that belong to the insolvent estate, and to ensure that all necessary steps have been taken to secure all known funds in various bank accounts in the name of the insolvent company, together with those in the name of the director and other known individuals associated with the director, Mr Geldenhuis,” Venter said.

Last week, the National Prosecuting Authority (NPA) confirmed that the Germiston Commercial Crimes Unit was investigating the dealings of Classic and Geldenhuis.

The Enforcement Division of the Financial Sector Conduct Authority also confirmed it has concluded its investigation into Classic “and several people” and was in the process of taking enforcement action against the investigated parties.

Read: Criminal investigation into Classic Financial Services and its director gets under way

This followed a warning to the public published by the FSCA in November last year, “to act with caution” when conducting any financial services-related business with Classic and Geldenhuis. The FSCA said neither Classic nor Geldenhuis was authorised to provide financial advice or render intermediary services in terms of the FAIS Act.

Geldenhuis was debarred from selling financial services or acting as an adviser in 2009 for dishonesty.

In May, it was announced that the NPA’s Asset Forfeiture Unit (AFU) successfully applied for preservation orders regarding funds – totalling about R19.5 million – deposited into Classic’s bank accounts. According to the NPA, the preservation orders over the preserved funds were necessary steps as a precursor to applications for forfeiture orders as prescribed by the Prevention of Organised Crime Act (Poca).

Read: Investors who lost money with Classic Financial Services One urged to lodge claims

Lodging claims

Although it has not yet been shared exactly how much money moved through Classic’s bank documents since it was incorporated in 2004, bank records procured by the FSCA showed that from 1 January 2019 to 31 August 2022, R412 419 440 and R83 513 962, respectively, had been paid into accounts created “for the deposit of investment funds”.

According to the FSCA, Classic had more than 1 000 clients.

Prior to Classic’s liquidation, the FSCA urged those who might have lost money in their dealings with Classic to lodge a claim with the High Court, to apply for the exclusion of their interest in the preserved funds to be forfeited to the state.

However, last week the NPA said that the liquidation of the company would have a significant impact on the AFU proceedings.

Advocate Adele Janse van Vuuren, senior state advocate at the NPA, said they were in the process of consulting with the appointed liquidators.

The State Attorney has been instructed to advise all investors who contacted AFU to await the outcome of these consultations before filing any further applications for the exclusion of their interest in the preserved funds “until such time as there is clarity on the way forward”.

In the letter, Venter said various meetings with the NPA have been concluded.

“We intend to intervene in the Poca proceedings instituted,” he said.

He added they received numerous enquiries in respect of a possible risk of a contribution being levied on creditors, as well as a possible dividend therein.

“We confirm that there is currently no risk of a contribution being levied on creditors, and all creditors are advised to complete the required claim form accordingly,” he said.

In the meantime, two claim documents have been circulated to creditors for completion:

• document one, where the investor a signed investment application and service contract; and
• document two, where the company never returned to the investor the signed investment application and service contract, but the investment was entrusted based on such agreement.

“We are constantly following up with the Master of the High Court, Pretoria, with regard to the convening of the first meeting of creditors and will advise all known creditors immediately we are aware of the date,” Venter said.

All original claim forms with the supporting documents should be delivered to PBP’s reception at Corobay Corner, Block A, 169 Corobay Avenue, Menlyn Maine, Pretoria.

Those who require assistance can contact Venter on 082 715 3629 or jaco@pbpadmin.co.za