A former investor with David Ross, who was responsible for the single biggest individual fraud in New Zealand, says the decision to declare Ross bankrupt could help find any hidden assets.
For full story by Collett Devlin published 28 July 2015 see:
The bankruptcy order was made by Associate Judge Warwick Smith in the High Court in Wellington on Tuesday during the bankruptcy and company liquidation proceedings. The bankruptcy order was sought by the Bank of New Zealand for an unspecified debt.
David Ross, 65 was jailed for 10 years and 10 months in 2013 for operating a fraudulent Ponzi scheme connected with his company, Ross Asset Management, that fleeced at least 700 investors of of about $115 million.
The investors thought they had more than $380m in portfolios.
RAM Investors Group spokesman Bruce Tichbon said bankruptcy was a fitting part of the fall from grace for Ross and it would be symbolic to investors.
Investors were never sure if Ross had stashed away assets for himself, he said.
“It [bankruptcy ] should give power to retrieve any hidden assets.”
In August 2013, it emerged Ross was a shareholder in an UK registered technology company, which had been touted as an NZX float prospect.
Fairfax NZ discovered documents filed to Companies House in Britain that revealed Ross held 200,000 preference shares in Arria NLG as trustee of the DRG Ross Family Trust.
At the time, John Fisk, who is the liquidator for Ross Asset Management, said he was not aware of the Arria shares and was not a receiver of the DRG Ross Family Trust.
Fisk said this week the bankruptcy would have no practical impact on his proceedings but it was something the liquidator was keen to see happen.
Meanwhile, a representative for Auckland-based lawyers Turner Hopkins was acting on behalf of the Bank of New Zealand, seeking the bankruptcy order.
He told the Associate Judge a debt owed to the bank remained unpaid and it was seeking adjudication.
The receiver’s report into the state of affairs of David Ross shows BNZ was an unsecured creditor.
His BNZ credit card had a debt of $17,502.
The report also shows an ANZ credit card in his name, with a debt of $47,194 and a Diners Club credit card with a debt of $2,663.
Associate Judge Smith noted, the “debtor was in prison and the service [of papers] was unusual in this case”.
It was unusual that the documents were not personally delivered.
The obligation to deliver the papers was imposed in the prison authority but he was satisfied “the prisoner” had received the documents and made the order for bankruptcy.
According to the New Zealand Parole Board, Ross is not eligible for parole until January 2019.
* Ross Asset Management investor appeals clawback decision
* Ross Asset Management liquidators counter Hamish McIntosh profits appeal
* David Ross sentenced to 10 years for fraud
* David Ross loses jail term appeal
Bankruptcy restrictions and responsibilities
The person can not:
– Be a director of a limited liability company.
– Conceal assets, stop, attempt to stop, or hamper the Official Assignee dealing with any property or assets.
– Enter into, carry on, or take part in the management or control of any business, be employed by a relative or entity owned, managed, or controlled by a relative or leave New Zealand without first gaining consent.
– Incur credit of more than $1000 without making the creditor aware of the bankruptcy
– A bankrupt person must notify the Official Assignee whenever personal details are updated or their financial position changes.