The late Nic Georgiou’s estate provisionally sequestrated

The Pretoria High Court has placed the estate of the late Nic Georgiou in provisional sequestration. If the order is made final, it may trigger an investigation into what happened to the R4.6 billion that thousands of investors invested in the former Highveld Syndication Schemes.

Sydney Poole, one of the investors, launched the application for the provisional sequestration of Georgiou’s estate in 2021. This was after Georgiou failed to repay R4.4 million due to him after the Pretoria High Court ruled in his favour in 2018.




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The case stems from Poole’s investment in the Highveld Syndication 22 scheme (HS22), which included a buyback agreement in which Georgiou undertook to repurchase Poole’s shares five years later at double the original selling price.

However, HS22 and seven other Highveld Syndications went into business rescue in September 2011. A Section 155 Scheme of Arrangement later tasked a company, Orthotouch, to take ownership of all the HS properties and repay investors. Unfortunately, Orthotouch also experienced financial difficulty and was placed in business rescue in November 2019.

The respondent in the matter was Luke Saffy, the executor of Georgiou’s estate. Interestingly, the two trustees of the N Georgiou Trust also applied to intervene, but it was dismissed.


In his judgment, Judge HF Jacobs stated: “The papers in these proceedings show a multitude of claims against the estate of the late Mr Georgiou, the companies he owned and/or managed and the Trust. The claims against the estate are substantial in monetary value and the dividend a sequestration order may achieve is argued to be rather small or insignificant at this stage but, proper inquiry by the trustee of the estate beyond what appears at face value to be available to creditors, might paint a different picture. To date hereof such an inquiry has not taken place at all. In the exercise of my discretion in this connection, I am of the view that prima facie, the requirements for a sequestration order have been satisfied, and that would be to the advantage of creditors of the estate if it is provisionally sequestrated.”

The provisional sequestration order also means the assets in the estate will be placed in the hands of the Master of the High Court.

Assets in the estate

A vital aspect of the case is whether assets of significance remain in the estate.

Before his death, Georgiou claimed in an affidavit in defence of a sequestration application that he owned no significant assets, a claim Advocate Louis Bolt, who acted on behalf of Poole, rejected.

“Evidence was placed before the Court that the facts clearly indicate that the facts of Georgiou’s solvency can be determined from what has been revealed in the papers before the Court. It was further pointed out that it will be impossible to ascertain the true extent of the alleged fraud, theft and deceit committed against the HS21 and HS22 Investors by Georgiou if a proper investigation into his financial affairs is not conducted,” said Bolt.

The Master of the High Court, now the custodian of the assets, may order such an investigation into whether all assets are accounted for in the estate.

Says Bolt: “Given the history of Mr Georgiou’s obstructive conduct throughout the ensuing litigation in respect of the investments made in HS21 and HS22 and the buy-back agreements entered into and, Georgiou’s lack of transparency, particularly on financial information as demonstrated in detail in the affidavit filed by the applicant, it is difficult to accept Georgiou’s claims that he did not own assets of substance.”

Bolt stated that his investigation revealed Georgiou owned significant assets and that he “managed to conceal any number of assets in various ways”.

This investigation found that Georgiou owned 15 properties in the Mbizi holiday resort in Bela Bela and was a shareholder of the marketing company selling other properties there.

Read: Georgiou-linked Bloem mall on auction block



It also revealed that Georgiou was a shareholder in 12 other companies. These include the Park Plaza Hotel in Sandton and the popular Pembury Retirement Lodge, which owns several retirement villages in Gauteng.

“It was argued that it is highly improbable that anyone who was the ‘guiding mind’ behind the substantial property developments in which Georgiou was involved and who, by his own account, has a long history of successful investment in property development should have … nothing or [so] little to show in his estate,” Bolt says.

“It appeared that Georgiou has ordered his affairs to ensure that assets that might otherwise have been owned by him directly are held instead by companies or trusts. Undoubtedly, Georgiou had control of or otherwise had access to substantial and considerable assets.

“It therefore clearly appeared that Georgiou possessed assets which he failed to disclose to the honourable Court.”

Bolt also said an amount of R4.3 billion was paid to Zephan flowing from the sale of properties to HS19-22, as well as another R303 million stemming from the oversale of shares in HS21.

“This money is still not accounted for. It is common cause that the N Georgiou Trust is the only beneficial shareholder of Zephan and that Georgiou was the only beneficiary of the Trust.”

Bolt also called for a thorough investigation of the possible ownership of undisclosed assets.

“The trustees of his estate should be allowed to pierce the corporate veil surrounding his multifaceted interests in a large number of companies, close corporations and other entities, wherever they may be situated or doing business, which must be meticulously investigated for purposes of ascertaining whether these entities have simply been used as vehicles to spirit away large sums of money and other assets belonging [to] Georgiou.

“A full-scale investigation and concomitant interrogation by the trustees under their powers in terms of the Insolvency Act will, in all likelihood, bring considerable assets to the fore.”

A hearing into why a final sequestration should not be granted will be heard in April.

Moneyweb sent questions to the respondents’ attorneys, but they did not respond.

Read the full judgment here.

William Murphy

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