Creditors of the collapsed Classic Financial Services investment scheme will recover just over 6% of their claims in the initial dividend, according to the first liquidation and distribution (L&D) account, now confirmed by the Master of the High Court.
In practical terms, this means roughly 6 cents for every R1 owed. The L&D account shows that although liquidators recovered R41 418 643.71, expenses absorbed more than half, leaving only R20 074 830.09 for distribution against total claims of R326 503 126.57 – a shortfall of R306 428 296.48 at present.
Van Heerden & Krugel Attorneys emphasise this initial payout reflects only the funds available at this stage, not the final dividend. The firm told Moonstone that “substantial work has been done (and remains ongoing) to generate further returns for the estate”, with several million rands already recovered since the first account’s cut-off.
According to the attorneys, this is the first tranche of what proved creditors may ultimately receive as the liquidation continues.
From FSCA complaint to Ponzi collapse
Classic Financial Services began unravelling in August 2022, when investor Nico Retief lodged a complaint with the Financial Sector Conduct Authority, alleging that Classic’s director, Cobus Geldenhuis, was unlawfully soliciting public investments.
The FSCA’s investigation found that despite having been debarred in 2009 for dishonesty, Geldenhuis continued to operate Classic as a Ponzi scheme, using client funds for personal benefit.
In a report released in May 2023, the FSCA said Classic had taken in more than R617 million from about 1 120 investors between January 2019 and May 2023, with R129.9m still unaccounted for. During the investigation, Geldenhuis admitted that Classic’s sole purpose was to steal money and that no client funds had ever been invested.
A final liquidation order was granted by the High Court in Pretoria on 30 May 2023, with WJ Venter, JA Fisher, and SJ McKenzie appointed as joint liquidators.
The first L&D account – ‘not the end of the road’
In a letter dated 5 January 2026, the joint liquidators informed creditors that the first L&D account had been confirmed by the Master.
The account lay open for inspection for 14 days, from 28 November 2025 to 11 December 2025, at the offices of the Master of the High Court in Pretoria and the Magistrate’s Court in Kempton Park.
In a letter to Moonstone dated 16 January 2026, Van Heerden & Krugel Attorneys emphasise that the first L&D account is an interim account for a defined period, not a “final picture”.
“The first L&D account is the first account lodged in the winding-up and it reflects receipts and payments for a defined accounting period only. It is not intended to be read as a final statement of total recoveries that will ultimately be achieved, total costs that will ultimately be borne by the insolvent estate, or the final dividend that creditors will ultimately receive.”
Put simply, it reflects what has been recovered and reduced to cash to date, what has been incurred, and what is available for distribution now.
The attorneys note that the first account exists to enable an initial dividend to proven creditors.
“The first L&D account is prepared to enable an initial distribution to creditors who have lodged and proved claims, rather than delaying any dividend until the estate is fully wound up. This is why the first account records a dividend now, notwithstanding that additional recoveries and additional claims processes remain ongoing.”
Further L&D accounts are expected before a final account is confirmed.
“The legislative scheme contemplates that additional liquidation and distribution accounts may be lodged as and when further assets are recovered, litigation is finalised, and additional funds become available for distribution. Accordingly, the dividend reflected in the first L&D account should not be characterised as ‘the dividend in the matter’, but rather as the first dividend based on funds available at that stage.”
In other words, according to the attorneys, the present dividend does not signal the end of recovery work or the last distribution creditors can expect.
“To the contrary, substantial work has been done (and remains ongoing) to generate further returns for the estate. The purpose of that work is to increase the estate’s free residue and thereby improve the ultimate dividend(s) payable to proved creditors in subsequent accounts.”
What the numbers show
Moonstone has seen a copy of the account, which was obtained from a confidential source.
In affidavits accompanying the account, each liquidator confirmed that it reflects a full and true account of the administration of the estate. They further stated that, to the best of their knowledge, no further assets remain to be realised, except for the possible recovery of outstanding debtor balances.
The account consists of a bank reconciliation statement, a free residue account, and a detailed schedule comparing creditor claims with distributions.
A total of 545 creditors is listed, including about five rejected and 16 duplicate claims. Claims range from R9 780 000 at the upper end to R2 000 at the lower end.
Total claims amount to R326 503 126.57. The amount available for distribution is R20 074 830.09.
This currently translates into a recovery rate of just over 6%. For instance, in this initial dividend, a creditor who claimed R9 780 000 will receive R601 316.61, while a creditor who claimed R2 000 will receive R122.96.
The free residue account shows total credits of R41 418 643.71, made up of:
- R451 000 from the auction of motorcycles;
- R38 604 970.02 recovered from debtors; and
- R2 362 673.69 in interest earned on the current account.
However, expenses totalled R21 343 813.62, leaving just over R20m at this stage for distribution among creditors.
Where the money went
The free residue account shows that legal costs and professional fees accounted for the largest share of the estate’s depletion.
According to the account, legal fees charged by multiple law firms totalled R11 939 637.79, made up as follows:
- One firm charged R8 900 757.98 (including VAT);
- A second firm charged R2 762 179.50;
- A third firm charged R237 752.81;
- A further legal fee of R16 100 was recorded in relation to the second meeting of creditors; and
- A cost consultancy fee of R22 847.50 was also listed.
Advocate fees amounted to R877 995, comprising three separate fee entries of R548 550, R46 200 and R283 245.
The liquidators’ remuneration was calculated in accordance with the tariff, at 10% of R40 967 643.71, amounting to R4 096 764.37, plus 10% of R451 000, amounting to R44 217.61. This brought the total liquidators’ fee to R4 140 981.98, on which VAT of R621 147.30 was levied.
In total, the liquidators’ remuneration including VAT came to R4 762 129.28.
At this interim stage, expenses of R21 343 813.62 are about 51.5% of the reported recoveries of R41 418 643.71.
The reported legal fees of R11 939 637.79 are approximately 28.8% of the reported recoveries and approximately 55.9% of the reported total expenses, respectively.
Van Heerden & Krugel Attorneys state that these ratios will predictably look different as additional recoveries already in process are received “and as recoverable costs are reimbursed from related estates and/or pursuant to costs orders, which reimbursements may post-date the cut-off of the first L&D account and therefore only feature in later accounts”.
“Critically: the legal costs were necessary costs of recovery in a complex, multiparty matter. They must be assessed against the recoveries already achieved and the recoveries reasonably anticipated from ongoing proceedings and related estates, and we can confirm at this stage already that several millions of rand have been recovered subsequent to the cut-off of the first L&D account, which will further affect these proportions,” the attorneys state.
Interim figures, not final recoveries
Van Heerden & Krugel Attorneys underscore that these figures must be read with the critical qualifier that this is a first L&D account reflecting an interim position at a particular point in time.
“Furthermore, one must consider that, for example, certain of the legal fees also include Advocates fees forming part of the attorneys’ bills of cost, and several of the other expenses are statutorily prescribed, such as, for example, the liquidators’ fees.”
According to the attorneys, the recoveries do not take into account:
- Assets disposed of by the liquidators, alternatively the liquidators and or trustees in related estates, and particularly the immovable properties sold, and which transactions are pending.
- Costs accounts in the successful sequestrations and liquidations of, inter alia, Tony Visser, Cobus Geldenhuis, Dewald Geldenhuis, Jackie Geldenhuis, Nano Guard (Pty) Ltd, among others, which will have a substantial reduction in the costs incurred once recovered from the various estates.
- Agreements to repay reached with investors who received substantial amounts in excess of their investments.
- Further litigation to be instituted against investors and or other third parties who materially benefited from the illegal scheme conducted.
Attorneys explain legal fees in first L&D account
Explaining why the legal expenses “appear elevated in the first account”, the attorneys state that it is important to understand that, in an estate of this nature (involving extensive investigations, recoveries, and related litigation), legal expenditure is not merely “overhead”.
“A material portion of it is incurred to generate recoveries, to preserve assets, and to set aside impeachable transactions for the benefit of creditors generally.”
The attorneys further set out that in broad terms, the legal expenses reflected in the first L&D account fall into three categories:
- General legal and administration-related legal work: This category covers the legal work that is incidental and necessary to administer the estate properly (including statutory processes, formal notices, engagements required to convene meetings and advance the administration, and related procedural steps).
“These are the types of costs that arise in the ordinary course of properly conducting any complex liquidation.”
- Recovery litigation and related sequestration/liquidation proceedings (costs expected to be recovered): A substantial component of legal expenditure relates directly to recovery work, including successful liquidation and sequestration proceedings and proceedings to set aside dispositions, and/or to obtain judgment or settlement against persons/entities who benefitted from the unlawful scheme. Where those proceedings are successful (or settlements are concluded), the costs are commonly recoverable in one form or another, including via: costs orders (taxed/agreeable costs); and/or reimbursement/dividend flows from the related insolvent estates (where the liquidated/sequestrated estates are obliged to meet those liabilities in the ordinary course).
“In matters of this nature, recovery litigation and associated insolvency proceedings are typically the principal mechanisms by which assets are brought back into the estate for the benefit of proved creditors.”
- Costs of the insolvency enquiry generating claims and recoveries: A further component relates to the insolvency enquiry process and associated investigative work, which is used to uncover the affairs of the company, trace funds, identify dispositions, and generate actionable claims.
“This work has facilitated recoveries and the identification of further claims which are being pursued. The expenditure cannot be evaluated in isolation; it must be assessed against the recoveries already achieved and the additional recoveries reasonably anticipated flowing from the enquiry-driven claims,” the attorneys state.
What creditors must do next
Creditors have been instructed to submit a bank confirmation letter, not older than three months, in the creditor’s own name. No payments will be made to third parties or accounts not held in the creditor’s name.
The confirmation letter must be emailed to bianca@pbpadmin.co.za.
Criminal case gathers pace
In March 2024, the FSCA confirmed that both Geldenhuis and Classic had contravened the FAIS Act and the Banks Act by operating without authorisation. Geldenhuis was debarred for 20 years and fined R143m.
The matter has since moved into the criminal courts. Geldenhuis appeared in the Ridge Magistrate’s Court in the first week of December 2025 after handing himself over to the Hawks on 4 December.
Read: Classic Financial’s Geldenhuis in court after four-year wait, first LDA lodged
The National Prosecuting Authority (NPA) said he faces charges of fraud and/or theft, contravening section 11(2) of the Banks Act and section 7(1) of the FAIS Act. Bail was set at R10 000, with no conditions, and the matter has been postponed to 26 January 2026 for disclosure of the docket. The NPA has confirmed that 19 complainant statements are already on file.
