Courts

MBABANE – The Nhlangano Town Council has obtained an order freezing Status Capital Building Society’s funds to protect its investment of E10 million in the building society.

The order by Judge Nkosinathi Maseko comes at a time when the Financial Services Regulatory Authority (FSRA) has appointed a curator to manage the affairs of the building society. Nhlangano Town Council is one of the investors in Status Capital whose collective over E100 million was allegedly misappropriated.

Nhlangano Town Council, represented by Mxolisi Dlamini of Dynasty Inc. Attorneys, approached the High Court seeking to freeze funds held by Status Capital to protect its E10 million investment.  The council’s application follows what it describes as a series of broken promises and a ‘catastrophic disaster’ that began in August 2024. The application was filed ex-parte (without notice to the respondents).

The court also directed the curator, Bimal De Silva and Status Capital to forthwith withhold withdrawal of funds from Status Capital’s coffers  amounting to E10 702 285 pending finalisation of action to be instituted by the town council  against the building society to recover the investments. The order also directs De Silva and Status Capital to show cause why the amount of E10 702 282 held by Status Capital should not be frozen pending action it seeks to institute against the building society. Status Capital has also been interdicted forthwith from withdrawing, transferring, utilising and alienating or dealing with the sum of E10 702 285 pending finalisation of action to be instituted to recover the town council’s invested funds. The orders have an interim effect.

According to the founding affidavit by Babsy Mavuso, the Town Clerk and Chief Executive Officer of the Nhlangano Town Council, the council and Status Capital began engaging in 2019. Attracted by the financial services provider’s public advertisements on radio, in print media and on social media, the council formed a committee to investigate the investment opportunities offered by the building society. Mavuso stated that the committee was assured that Status Capital was not a fly-by-night company and based on this assurance, the council passed a resolution on October 27, 2021, to invest E10 million. The agreement promised an interest rate of 9.25 per cent per annum, with a projected return of E14 625 000 over five years.

Full article available in our publication.

Babsy Mavuso, the Town Clerk and Chief Executive Officer of Nhlangano Town Council, told the court that they were assured that Status Capital was not a fly-by-night company. (Pic: File)