Fidentia’s collapse had further repercussions in the Cape High Court on Friday when two closely linked companies were also placed under curatorship.
The court granted a provisional order placing Ovation Global Investment Services and Ovation Global Investment Nominees under curatorship.
An attorney, John Levin, and a forensic accountant, Barend Petersen, were appointed joint curators to the business of the two companies, the Financial Services Board (FSB) said in a statement.
The return date of the provisional order is May 15, when interested parties may be heard and a report by the curators will be considered by the court.
The order was granted following an application by the executive officer of the FSB in his capacity as the registrar of financial-services providers.
FSB spokesperson Russel Michaels said Ovation Services had been licensed to render non-discretionary administrative services as a linked investment services provider (a so-called LISP).
It had also been approved to administer pension funds.
”In court papers it was stated that the Ovation companies are closely associated in business with Common Cents Investment Portfolio Strategists and Fidentia Asset Management and that the curatorship of these companies has seriously affected the business of Ovation,” he said.
In terms of the provisional order, the curators would take immediate control of, manage and investigate the business and operations of the companies with a view to conserving the business.
In exercising their powers the curators had been directed to give consideration to the best interests of investors in the companies.
The order expressly provided that investments in or administered by Ovation could not, without the prior approval of the registrar, be withdrawn, transferred or otherwise disinvested.
However, the curators were given the discretion, subject to available resources, to maintain payments to annuitants, pensioners and other beneficiaries who received regular payments from their investments.
”Although thorough investigations into the affairs of Ovation are yet to be completed, the registrar has been assured by current management that the 15 000 clients whose R4,4-billion is administered by Ovation are unlikely to suffer substantial losses on their investments.
”These investors are advised to exercise patience and to leave it to the curators to look after their interests,” Michaels said. — Sapa