Court setback for Ponzi scheme suspect
A pastor allegedly at the helm of a Ponzi scheme was refused access to his funds by the Western Cape High Court.
|||The Cape Town pastor allegedly at the helm of a multimillion-rand Ponzi scheme will have to scale down his lifestyle after the Western Cape High Court refused him access to funds under the control of a curator in terms of a preservation of property order.
Colin Davids, who claimed in court papers that he was “accustomed to living a comfortable lifestyle”, wanted access to R90 000 a month for day-to-day expenses, as well as R200 000 a month for legal fees.
But Judge Siraj Desai on Friday refused his application, saying it was “open to considerable debate” whether R90 000 a month was considered reasonable for a family of six.
Davids also did not explain how the R200 000 a month which he claimed for legal fees was quantified, he added.
The New Direction Grace Church pastor is the sole member of Platinum Forex CC, and he and the close corporation are under investigation for allegedly luring people with promises of returns as high as 84 percent on forex investments.
Investors’ money was allegedly used to to pay others, and investigators believe Davids spent the rest on property and flashy cars.
In July, the Asset Forfeiture Unit (AFU) obtained a preservation of property order, which allowed it to attach Davids’s assets and place them under the control of a curator.
However, Davids complained in an affidavit that his livelihood was under threat and asked the curator to pay him R90 000 a month for day-to-day expenses, including clothing, food and school fees, as well as R200 000 a month for legal fees.
In court papers it emerged that Davids’s monthly expenses amount to R89 779, including R10 000 for entertainment and “ancillary expenses”, R15 000 for groceries and toiletries for a family of six, R2 000 for his older daughters, tuition fees for his younger children, and installments for vehicles, including two BMWs and a Jaguar F-Type V8 S convertible.
He turned to the court for help, asking it to grant him access to funds under the control of the curator.
Delivering judgment yesterday, Judge Desai said a preservation of property order could only be varied under limited circumstances, and included provision for “reasonable” living expenses.
However, jurisdictional requirements first had to be met in terms of the Prevention of Organised Crime Act. These included making a full disclosure of all realisable property and providing a sworn statement of assets and liabilities.
He found that Davids had not met those requirements.
He referred to the AFU’s submission that less than R2m remained in Platinum Forex’s Nedbank account when the curator took control of it, when more than R500m had been deposited between August last year and June this year.
This remained unexplained, Judge Desai said. The lack of disclosure made it difficult, “if not impossible”, for the court to find in Davids’s favour, he added. The application was refused.
Saturday Argus
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