Ovation curators mull Absa claim

Johannesburg - The Ovation curators are contemplating a claim against Absa that could run to hundreds of millions.

In the curators' sixth report that was handed in to court last week, it was evident that they had obtained legal opinion about the possible claim against Absa.

In the report the curators said that they would shortly decide on further steps. Should their claim against Absa proceed, it would be for a significant amount.

The curators are considering the claim because of an amount of R218m that passed through an account at its Booysens branch.

This account was opened under false pretences by the late Angus Cruickshank, the main shareholder in Ovation and Common Cents (under curatorship), with the assistance of an employee at that branch. The employee has since been dismissed.

The account was opened in the name of Ovation Nominees and the money paid into it was supposed to have been paid the next day into money-market instruments in terms of investors' instructions.

This was not done and the money left this account for various entities under Cruickshank's control.

The money paid into the account was mainly investor funds in the so-called Common Cents cash pool belonging to former investors in the dissolved Jean Multi Managers (JMM) scheme. According to the curators' report, there is no "underlying value" in the assets of the Common Cents cash pool.

The curators have identified the people to whom the investments belong as they are still on the books of Ovation as part of its investment portfolio.

The investments are unfortunately to all intents and purposes "worthless". City Square Trading, the entity that took over the investments from JMM, has meanwhile also been liquidated after the Ovation curators proved that R63m of

Ovation's money had ended up in City Square.

The curators also submitted a claim against Cruickshank's estate - Cruickshank having committed suicide in September 2006. Cruickshank's estate has been sequestrated.

The Ovation curators have furthermore brought a claim against the estate of Steven Goodwin, who was sequestrated at the request of the curators.

Goodwin is currently serving a prison sentence for his involvement in the misappropriation of money at Fidentia (in curatorship) as well as at Ovation.

A claim by Ovation against Goodwin's company Worthytrade was dismissed by the court, but Ovation has proved claims totalling R2.9m against Cruickshank entities (including Worthytrade).

The Ovation curators have already received R6.5m from Cruickshank's estate. They will be investigating the possibility of bringing action against the Ovation directors.

- Sake24.com

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