Michal Calitz/Im­pact Fi­nan­cial Con­sul­tants or­dered to re­pay R10 m

The Star Early Edition - - BUSINESS NEWS - Roy Cokayne

THE AMOUNT fi­nan­cial ad­viser Michal Calitz and/or Im­pact Fi­nan­cial Con­sul­tants must re­pay in­vestors who on his ad­vice in­vested in the Rel­a­tive Value Ar­bi­trage Fund (RVAF) has in­creased to more than R10 mil­lion.

This fol­lows two fur­ther de­ter­mi­na­tions by the om­bud for fi­nan­cial ser­vices providers (Fais) Nol­untu Bam against Calitz and/or Im­pact Fi­nan­cial Con­sul­tants.

To date, Bam has is­sued 16 de­ter­mi­na­tions against Calitz and/or Im­pact Fi­nan­cial Con­sul- tants re­lated to ad­vice given to clients to invest in RVAF, which is in liq­ui­da­tion. The fund col­lapsed after the fund’s man­ager and trustee Her­man Pre­to­rius com­mit­ted sui­cide in July last year after shoot­ing dead his business part­ner.

Bam this week or­dered Calitz and/or Im­pact Fi­nan­cial Con­sul­tants to re­pay Martha Carstens the R1 649 500 she in­vested in RVAF. There is a R800 000 ju­ris­dic­tional limit on the value of the or­ders the Fais om­bud may is­sue.

Bam said the in­vest­ments by Carstens com­prised smaller amounts spread over a num­ber of years and ac­cord­ingly com­prised sep­a­rate and dis­tinct causes of ac­tion on their own.

Carstens made 22 in­vest­ments in RVAF be­tween Au­gust 2008 and May 2012. Calitz ar­gued the loss did not arise out of any risks taken but was di­rectly at­trib­ut­able to one per­son’s fraud.

In another de­ter­mi­na­tion pub­lished last week, Bam or­dered Calitz and/or Im­pact Fi­nan­cial Con­sul­tants to re­pay Erika Kruger R800 000.

Kruger in­vested R900 000 in the MAT Abante UK Rel­a­tive Value Ar­bi­trage Fund.

She was led to be­lieve it was a safe in­vest­ment with ex­cel­lent growth prospects and dis­tinctly sep­a­rate company but after Pre­to­rius’ death learnt it was con­trolled by Pre­to­rius and there­fore part of his es­tate.

Kruger agreed to forego the amount of her in­vest­ment ex­ceed­ing the R800 000 ju­ris­dic­tional limit of the Fais om­bud’s of­fice.

She made the in­vest­ment in what she be­lieved was an in­ter­na­tional in­vest­ment after the sale of her im­mov­able prop­erty in Au­gust 2010.

Bam said there was no ev­i­dence the funds were ever in­vested off­shore or in a sep­a­rate fund or en­tity.

She said the ap­pli­ca­tion form and bank ac­count de­tails into which Kruger was to de­posit the funds were iden­ti­cal to the doc­u­ments used in all other RVAF mat­ters be­fore her of­fice.

Bam said Kruger de­posited the funds into the South African bank ac­count of RVAF on the ba­sis of the in­struc­tions and forms pro­vided by Calitz.

She said the Abante Group pro­file brochure pro­vided to her of­fice by Calitz re­flected that the MAT Abante UK was domi­ciled in Guernsey in the Chan­nel Is­lands; the client ad­min­is­tra­tion was per­formed by MAT Se­cu­ri­ties and the fund ad­min­is­tra­tion by a South African ad­min­is­tra­tion company based in Jo­han­nes­burg; the Royal Bank of Scot­land per­formed the cus­to­dian func­tion; and all pay­ments must be made out to MAT Se­cu­ri­ties.

Bam said her of­fice would not ex­pect to see the funds de­posited into a South African bank ac­count, much less the ex­act same ac­count used for RVAF. “The breach of the ba­sic prin­ci­ple of sep­a­ra­tion of funds in in­ex­cus­able,” she said.

Calitz said Kruger specif­i­cally re­quested that monies be in­vested with MAT World­wide.

Bam said Calitz wished to at­tribute the loss to one per­son’s fraud yet it was his ac­tions in con­tra­ven­ing the most ba­sic el­e­ments of the Fais Act that led to Kruger in­vest­ing in this in­vest­ment.

She said no ad­viser would have rec­om­mended this prod­uct as a suit­able com­po­nent of any in­vest­ment port­fo­lio had they ex­er­cised the re­quired due skill, care and dili­gence.

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