Tannenbaum assets placed into final sequestration
August 19, 2009
By Roy Cokayne
The personal estate in South Africa of Barry Tannenbaum, who operated the Ponzi-type scheme that fleeced millions from investors, has been placed in final sequestration.
Judge Martin Brassey granted the order in the South Gauteng High Court yesterday despite a last-ditch attempt by Tannenbaum's lawyers to get the provisional order extended.
In a separate case, an order granted last month freezing some assets of Darryl Leigh, a top agent for Tannenbaum's scheme, was lifted subject to certain conditions yesterday.
Judge Thokozile Masipe made a deal between Leigh and four investors in Tannenbaum's scheme, which provides for some of these assets to be sold, an order of court.
The agreement is between Leigh and Johannesburg businessmen Christopher Dudley Leppan, Stephen Meltzer and Marius Malherbe and retired attorney Eric Archibald Truebody, who together invested a total of R6.7 million in the scheme and brought the application to freeze Leigh's assets.
Assets in the initial order included: a 2008 Lamborghini Murcielago Roadster worth R5m; a 2008 Lamborghini Gallardo Spyder worth R3.5m; a Mercedes-Benz SLK 55 sports car; a Mercedes-Benz SLK 350; two BMW X5s; a Moomba speedboat; a R300 000 non-refundable deposit on a new Lamborghini worth R3.5m; a Sandton erf bought for R16m in March 2007; Unit 6 of Woodhead Glen in Camps Bay purchased for R3.6m in November 2005; and 3 Medburn Road in Camps Bay.
All these assets, excluding the Lamborghinis and a unit in Camps Bay, will be released immediately from the restraining order in terms of the deal.
But if any assets are sold, the net proceeds from their sale plus the R300 000 held by Investment Cars in Leigh's name must be put into the trust account of Leigh's attorneys.
The inclusion of 3 Medburn Road in Camps Bay in the restraining order was an error.
Leigh and the investors agreed to jointly sell the Lamborghinis with the net proceeds from the sale in a bank account to be opened in Leigh's name.
Leigh will sell the Camps Bay property with the net proceeds from the sale paid into this account. The attorney of the four investors and Leigh's attorney will be joint signatories of the account. The proceeds of the sale of assets will remain in this account until the outcome of a civil claim by the four investors against Leigh, or a deal is reached on proceeds. Any surplus in this account in excess of R6.7m will be released to Leigh.
The investors acknowledged the agreement was made without prejudice to any of Leigh's rights and without any admission of liability to them at all.
In the Tannenbaum case, attorney Darryl Ackerman confirmed in an affidavit that he represented Tannenbaum "in respect of certain aspects of his affairs" and had been instructed to seek an extension of the provisional order.
Ackerman said Tannenbaum told him he had not received notice of the application and nor to the best of his knowledge had the original papers in the sequestration been served to Tannenbaum in Australia.
Tannenbaum was thus not able "to properly consider his position", said Ackerman.
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