Jeevas victims of Ponzi scheme
Hundreds of investors may be forced to return profits
MEMBERS of a prominent Uitenhage family – the Jeevas – are among thousands of people who fell victim to a multimillionrand Ponzi scheme which targeted wealthy Muslims across South Africa.
Investors lost more than R200-million in total.
Now the Jeevas and more than 800 other investors who may have seen some returns could be forced to return the spoils.
The liquidators for World Focus 889 CC, run solely by Cape Town financial broker Jasmin Ebrahim, have asked the Western Cape High Court to order 871 investors to return any profits paid to them.
The investors, mostly wealthy professionals from Port Elizabeth, Uitenhage, Johannesburg, Cape Town and Durban, lost about R200-million when the scheme collapsed in April 2010.
While some of the investors received minimal returns, most did not see a cent.
In papers filed with the court last week, the liquidators claimed some investors were favoured over others.
They asked the court to compel the 871 investors who did receive at least some profit to return the money so that it could be divided equally among the majority who lost out.
The total number of investors is not revealed in the court documents.
Although most of the 871 respondents, including 12 Jeeva family members, indicated to the liquidators they would oppose the application, they have not yet filed responding papers. Among the respondents, are: ý Import and export tycoon and family patriarch Adam Jeeva, 71, of Uitenhage;
Uitenhage businessman Ayub Jeeva, the younger brother of Yusuf, who owns the Kwantu Game Reserve near Grahamstown; and
Port Elizabeth wholesale distributor Shiraaz Mayet, 51, of Parkside.
Mayet said yesterday his family had lost a large amount of money in the scheme. He would not, however, disclose how much it was, saying it was “a private matter”.
“It was a long time ago. It does not matter now,” he said.
According to the court papers, World Focus conducted an illegal pyramid scheme by accepting depos- its from investors, which were then used to pay returns on the investments of earlier investors. The investors were reportedly drawn in through their religious beliefs.
It was reported that recruiters even used quotes from the Koran to convince investors to hand over their cash. The Koran is the most sacred religious text in the Muslim religion.
Between April 2008 and April 2010, World Focus received investments totalling at least R205- million. Ebrahim reportedly drew a salary of about R180 000 a month during this period.
Liquidator Ryno Engelbrecht said during that period World Focus was “factually insolvent” in that its liabilities exceeded the value of its assets.
The company was wound up on April 10 2010.
He said all contracts between World Focus and its investors were unlawful and void.
“As is invariably the case with schemes of this nature, World Focus eventually found it impossible to attract a sufficient number of new investors to fund the payments due to its existing investors – and the scheme collapsed,” Engelbrecht said.
World Focus had offered investors a range of investments to choose from, including a water purification scheme in Central Africa, an RDP housing scheme in Brazil, a coal investment fund and Eskom schemes in South Africa.
He said the Eskom scheme proved the most popular, and offered investors a 10% share in a heavy commercial vehicle that would transport coal from mines to power stations for R150 000. Investors were promised a R15 000 monthly return on their investment for two years.
Engelbrecht said the profits were always “too good to be true”.
Some creditors received payment during the two-year period, while others did not.
He said retrieving the money would not be easy as the respondents had already indicated they would oppose the court action, which would make it a costly exercise.
They have until November 1 to file responding papers.