This figure emerged in court papers asking for the scheme’s sequestration.

Pretorius allegedly shot his former business partner Julian Williams on Thursday last week before turning the gun on himself.

Pretorius’s scheme was called the Relative Value Arbitrage Fund (RVAF).
A portion of the funds raised by the scheme appear to have been invested in a trust.

On Monday an investor in the RVAF, lawyer, Morné Strydom of the firm Mostert & Bosman, brought an application to sequestrate the fund.

Strydom has a personal investment in the RVAF to the value of R233 000.

The RVAF had two trustees: Herman Pretorius and Eduard Brand. After Pretorius’s death, Brand is the only remaining trustee. The trust was started in 2004.

In the affidavit, Brand says: “I was only involved in an administrative capacity.”

He added that to the best of his knowledge, the total amount owing to the trust’s investors is R1.8 billion. He established this from quarterly statements issued to investors. But Brand admits   he “has no knowledge of where the trust funds are invested” because Pretorius took complete responsibility for the trust’s investments.

But despite claims that he does not know where funds were invested, or the value of investments, “I have no doubts that the trust’s total obligation to investors, is much more than the value of the total investments”.

The sequestration application reveals that recent investor withdrawal requests total some R200 million. This amount is due and payable to investors.

Brand says that he has access to the trust’s bank, and has confirmed that it has almost no funds at its disposal to make these payments.
He states further: “To my knowledge there are no other funds that will, in the near future, become available to the trust, which will be sufficient to cover its responsibilities.”

Strydom says  there is a reasonable prospect that a curator will be able to find assets belonging to the trust amounting to several millions of rands, but that it is unlikely.

The trust does not appear to have produced any financial statements. Says Brand: “Pretorius never submitted any financial statements to me for my consideration as co-trustee. “To my knowledge, no financial statements for the trust were ever produced.”

Strydom writes: “It is clear from Brand’s statement that although he does not have the exact figures available, the trust’s liabilities far exceed its assets. Strydom claims the trust is therefore insolvent.

He says it is imperative that a curator takes control of all financial records of the trust.
This would enable him to appoint an independent auditor who can account for all of the its assets.

The application was heard in the Cape Town High Court yesterday afternoon before Judge Bertus Fourie. A decision on whether to sequestrate or postpone the case will be announced by Fourie this  morning.

– julius@moneyweb.co.za