No wrongdoing related to the transfer of funds – Zephan and Orthotouch BRP

Du Toit pays disputed funds into a new trust account
Jacques du Toit. Source: Du Toit Business Rescue Practice website

Jacques du Toit, the business rescue practitioner of Orthotouch and Zephan, has vehemently denied any wrongdoing in having instructed that an amount of R1.12 million due to Orthotouch investors be transferred from an attorney’s trust account to Orthotouch.

In a 100-page affidavit in response to allegations by Robert Black, a former investor in the HS companies, Du Toit also states he has already instructed his lawyer to institute defamation proceedings against Black, and his attorney Ilze Eichstadt. He also intends to lay a complaint of professional misconduct against Eichstadt “for preparing an affidavit which she should have known contains false allegations”.

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Du Toit submitted this affidavit to the South African Restructuring and Insolvency Practitioners Association (Saripa) after the body requested a response to Black’s affidavit.

Du Toit has also repaid the money into a trust account until there is clarity regarding its status.

In his founding affidavit, Black alleged Du Toit unlawfully authorised the transfer of the R1.12 million to Orthotouch. The money was originally due to former investors in the Highveld Syndication schemes, in terms of the Section 155 Scheme of Arrangement (SOA) which brought Orthotouch about.

However, in 2018 Zephan, owned by Nic Georgiou and the underwriter of the SOA, terminated all interest payments to around 4 500 investors who were deemed to support legal action against Georgiou and entities related to him.

Read: Criminal charge laid against Orthotouch BRP

This was in contravention of the SOA, and the interest was paid into an attorney’s trust account on demand of the former receiver of the scheme, Derek Cohen, over which he had full control.

An escrow agreement was signed by Cohen and Georgiou, on behalf of Zephan and Orthotouch in November 2018, which provided that the monies would be held in the trust account “until directed by the Receiver to make payment to each investor, alternatively return the payment to Orthotouch/Zephan.”

However, Cohen resigned shortly afterwards in 2019, and no replacement has been appointed to date.

Du Toit was appointed as the business rescue practitioner of Zephan and Orthotouch in 2019 and assumed control of both companies.

Read: No more interest payments for investors fighting Georgiou, Orthotouch

In response, Black laid criminal charges of theft against Du Toit.

Du Toit’s affidavit

Du Toit states in his affidavit that he had authority to access the funds as the business rescue practitioner of Zephan and Orthotouch. He adds that the escrow agreement entered into by the parties also allowed him to do so.

“It is inconceivable on what basis Black could have come to the conclusion that I have stolen these funds. I have instructed my attorney to issue summons against Black and Eichstadt based on defamation and to lay a complaint of professional misconduct against Eichstadt for preparing an affidavit which she should have known contains false allegations.”

Despite these views that he had the authority to access the funds, Du Toit has nevertheless placed the money back into an independent trust account. This is confirmed in an email Johan Victor, Du Toit’s attorney, sent to Saripa CEO René Bekker.

“I wish to confirm that the deposit of the disputed amount has indeed now taken place and the funds will be held in Trust pending a determination of whether the creditors, to whom these funds may relate to, are secured or unsecured for purposes of the business rescue process,” Victor wrote.

Moneyweb approached Eichstadt for comment. She declined to comment on the content of Du Toit’s affidavit, but said an answering affidavit is being prepared.

Business rescue plans

During the course of communication between Moneyweb and Victor, Moneyweb requested an update related to the business rescue process of Zephan and Orthotouch.

Through Victor, Du Toit stated that he is busy with a revision of the business rescue plans and that he will publish a revised plan within the next few weeks.

Victor said the Zephan and Orthotouch draft Business Rescue Plans had been supplemented with additional information to address concerns raised by affected parties and their attorneys. “Some of the additional information relates to payments made to pre-2011 creditors (not addressed in previous draft plans). Also, comprehensive information came to hand about properties which formed part of the previous Scheme of Arrangement – which in turn was the result from the previous Business Rescues (of various underlying companies [of which Hans Klopper was the BRP]).

“Ample information about the 17.29% mark-up by Bosman & Visser and the HS Companies, which was added to properties acquired for R3.9 billion is also included in the revised plans together with the distribution breakdown of such mark-up.”

Victor also said this plan would include information related to the second creditors’ meeting where parties will vote on the adoption of the plan. “It is foreseen that this meeting will be a hybrid meeting, where creditors can either attend personally or via an electronic feed.”

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So Mr du Toit IF there was mo wrongdoing why transfer the funds to a different account until proved wrong if you know you were not wrong???? It seems like you are amending the Business Rescue Plan after you apparently received more information that you were not aware off. Excellent that means that now you are now obliged to investigate Bosman Visser’s add on of 17 plus% on the sale of the properties to Highveld Companies to determine if there were enough value. Start by checking the valuation method and certificates as well as the name of the professionals by asking Mr Myburgh Ceo of Bosman Visser the buyer of properties from Zephan as well as the seller to Highveld Companies. Audited Income and Expense statements should be verified to determine if the selling prices were not inflated by 17+%???
As said numerous times before the can of worms are between Zephan Nic and Bosman Visser Rikus Myburgh.The alleged dispute are one of the worms So Mr du Toit do the honourable thing and investigate what Hans Klopper neglected to do!!! Keep in mind Mr Rikus Myburgh was also the CEO of Pickvest the promoter of the property syndication product which means that money was earned by Bosman Visser and Pickvest by the selling of the same properties!

Wow ! This hundred page affidavit by Du Toit had me in tears. How can anybody write such a lot of information without proof of what he has written. Page 32 Para 81.2.4. refers. This is the crux of the whole story. Part of the duties of a business rescue practitioners is to investigate the affairs of the company. One of the most important aspects to determine the affairs is to investigate the financial statements of a company. Did I miss it, or did du Toit miss the sale of R 3 BILLION worth of companies from Orthotouch to Accelerate Property Fund in 2013. Mr Nic Georgiou signed a sworn affidavit to this effect in 2013 in front of the Competitions Commission. AND, there are NO FINANCIAL STATEMENTS from 2012 to 2020 for Orthotouch or Zephan to show what happened to R 3 BILLION. Where did du Toit get his information from to publish all those figures that he published. We only require evidence and proof of your figures in the form of financial statements Mr Du Toit. I agree with Logic, why all of a sudden transfer the funds back into a trust account ?

Wow wow wow a 100 page affidavit which was quite comprehensive But irrelevant
WHY????
One again the focus was on the bad economy,massive amounts of interest paid,devaluation of properties bla bla bla……
Refresher: In the MEMORANDOM OF AGREEMENT BETWEEN NIC GEORGIO/ ZEPHAN THE SELLER AND BOSMAN VISSER DIRECTOR MR MYBURGH AND THE HIGHVELD CO DIRECTORS BUYERS FROM BV it was stated that “The sales agreements could not be concluded because of the dispute” which means the properties which was paid with investors money via Eugene Kruger attorneys trust acc to Bosman Visser could not be transferred.Eugene Kruger stated in a letter the dispute has been resolved and that the transfer of properties will commence He also stated that the reconciliation of payments were done to Zephan and an overpayment was made. So Mr du Toit did you investigate the “dispute” or was time also of essence like Hans Klopper proclaimed????? Simple check the proof of payments from Kruger trust acc which will take minimum time to get the million dollar answer that nobody would challenge. Surely trust accounts are updated regularly This was the core of the misery not all the impressive detail in your affidavit. Oh remember Zepan and kie was indirectly involved in the day to day activities of the Highveld Co in so far that they were the Building Managers of All the properties that were sold from beginning to end which means they collected the rentals,did the maintenance(check the invoices extreme amounts eg Security,cleaning and and and)
Remember ownership never changed and therefore I agree with Pine Check the financials and flow of funds from The trust acc to Bv to Zephan especially the EXPENSES and Income according to the rental contracts. This is common,good practice. Stop supressing the real facts and blaming the economy etc.

DuToits affidavit is a BLOCKBUSTER “must read”. He asserts that the Highveld syndication scheme was doomed from the start and that it could never succeed, because of mark ups and costs added which bloated the prices. Did you report this Meneer? will we at least get the retribution of people donning orange jump suits? See paragraph 33 – “At that moment in time neither Zephan, Orthotouch, the directors of Orthotouch, Nicolas Georgiou nor his family were in any way involved in the affairs of Bosman and Visser” So – Please tell us Meneer at what time were they all involved or did Bosman and Visser act alone in stealing and defrauding?

Dear MR BRP

PLEASE, please explain how you can allow the HSBF/HSIF to continue promoting the JSE Share Option and writing up Investors for these shares whilst A BUSINESS RESCUE PLAN IS IN THE PROCESS OF BEING DRAWN UP?

You cannot say that you are not aware of this because MR HELGARD HANKE who is on Management of the HSBF/HSIF is also on the CREDITORS COMMITTEE of ORTHOTOUCH & ZEPHAN BUSINESS RESCUE.

I cannot imagine this practice by the HSBF/HSIF is legal???

Surely, your duty as BRP is to halt all business dealings until the PLAN IS IN PLACE??

How can a plan be put forward with accurate figures if people have signed up and continue signing up for this offer- surely they have to be taken out of the Creditors equation??

I hope there will be some clarity on this matter soon … either in your next Monthly update or maybe Ryk can get some answers for us investors??

Yes especially since Helgard Henke is NOT an investor. His wife WAS at one time an investor but got paid out. Ask Henke to prove he is an investor and not an impostor! if he produces “proof” scrutinize it – hes just a puppet for the perpetrators. Im guessing Mr. BRP is all too aware of this!

End of comments.

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