SPCS

SOCIETY FOR PROMOTION OF COMMUNITY STANDARDS INC.

Securities Commission’s silence far from golden [re Property Ventures Ltd insolvency]

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Opinion-Piece – Pre-receivership papers on Property Ventures [Limited] suggests our regulators have some explaining to do. writes Chalkie. Just as a dung beetle likes nothing better than burrowing into a big steaming cowpat, providentially plopped into its path by a benevolent donor, Chalkie loves a good document dump. In this case the documents come from the old Securities Commission, since renamed the Financial Markets Authority, and the Ministry for Business Innovation and Employment. They reveal how overseas investors were stiffed by Christchurch-based property developer Property Ventures, more than two years before the company fell into receivership owing $69 million. They show an impotent regulator, unable to act and repeatedly complaining about unanswered correspondence.

They reveal a conflict of interest at the Companies Office [ involving the registrar of companies Mr Neville Harris] that might have affected an inspection of Property Ventures under the Securities Act….

Property Ventures was a development and investment company founded by motivational speaker Adolf de Roos and led by Christchurch-based developer David Ian Henderson….

For more go to: http://www.stuff.co.nz/business/opinion-analysis/10065328/Securities-Commissions-silence-far-from-golden

“Chalkie” is written by Fairfax business bureau deputy editor Tim Hunter

For further reading see:

Article published by SPCS on 16 May 2014

David Ian Henderson – Property Ventures Ltd (In Liq.) and role of Liquidator

Securities Commissioner told of Ross Asset Management Ponzi scheme concerns but took no action

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The Securities Commission appears to have been warned about suspected Ponzi scheme operator David Ross three years ago, but took no action. [David Ross was sole director of failed Ross Asset Management Ltd]

An email obtained through the Official Information Act shows Securities Commissioner Annabel Cotton was told of concerns about Ross in September 2009.

At the time, Ms Cotton had a special role as commissioner for financial advisers, responsible for developing a code of conduct for the financial advisory industry.

The email reads:

“Has anyone every [sic] looked into the activities of David Ross funds management? He doesn’t ad [sic] up to me and I could explain why verbally if you wished.”

The name of the sender was redacted from the OIA document, although it is understood the sender was a professional investor.

Ms Cotton said she had forwarded the email from her personal address to her Securities Commission address so that she could discuss it with commission staff when she was next in the office, “and to the best of my knowledge that’s what I would have done”.

“What happened from there I don’t know. I would have left it with a senior staff to work things from there and decide what to do.”

The Dominion Post has learnt of another individual who claimed he contacted Ms Cotton verbally about Ross, before September 2009.

The person, who asked not to be named, said he was told the commission was too busy to look into his concerns.

“I remember Annabel’s words exactly,” he said. “[She said] ‘I hope you’re not right’.”

Ms Cotton, who owns investor relations consultancy Merlin, said she had no recollection of the conversation.

The Financial Markets Authority, successor to the Securities Commission, licensed Ross as an authorised financial adviser in July last year.

Ross’s Wellington offices were raided by the FMA on October 31 after it received client complaints on October 25.

Receivers appointed to Ross companies by the High Court have found assets totalling $11.5 million, a significant shortfall on client accounts purporting to be worth $449.6m.

The Serious Fraud Office is investigating.

Source:

http://www.stuff.co.nz/business/money/8072464/Commissioner-told-of-Ponzi-scheme-concerns

The Dominion Post, Thursday, December 13, 2012, p. A3

Further Reading:

Ross Asset Investors may face ‘gruesome legal fight’

The National Business Review, Tuesday 4 December, 2012

http://www.nbr.co.nz/article/ross-asset-investors-face-gruesome-legal-fight-if-ponzi-scheme-shown-bd-133420

 

Bernard Whimp: Injunction sought against banned company director

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Lawyers representing the Securities Commission will go to court today to try and prevent Bernard Terence Whimp, a convicted burglar, former bankrupt and current banned company director, taking control of any shares through his latest “low-ball offers”. [Read more…]

Bernard Whimp – banned company director targets shareholders again

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A banned company director who has gained notoriety for his dishonesty, multiple legal threats and whimpish behaviour has again come under the spotlight today.

Bernard Terence Whimp, a convicted burgler and former bankrupt, was banned for five years from managing, promoting or directing any company: the ban commenced on 19 April 2007 and ends on 19 April 2012 according to the Companies Office website. And yet despite this disqualification (the maximum ban that can be imposed under the Companies Act 1993), he has seen fit, as a controller in a number of limited partnerships, including Energy Securities LP and NZ Investment Secirities LP, to target thousands of shareholders in at least six NZX-listed companies; sending them unsolicted letters offering to buy their secutities: letters that contain “misleading” and/or defective documentation.

The Secuties Commission has issued an order against Mr Whimp, as serious questions hang over the level of honesty and transparency involved in these communications with shareholders. [Read more…]

BusinessDay Probe into John Hotchin using Companies Office Records and ‘surveillance’

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Convicted financier John Hotchin, former director of Nathans Finance, which collapsed in 2007 owing debenture investors $174.5m, pleaded guilty in the High Court last week to three charges brought by the Securities Commission:  making untrue statements in Nathan’s investment documents. He was sentenced to 11 months home detention and BusinessDay (The Dominion Post 9 March) reports that it understood from what was stated in court at sentencing, that it was to be served at a rented property.

Documentation readily accessible on-line to the New Zealand public has often been used by investigative business reporters to probe and raise serious questions concerning suspected and actual white collar criminal activity. They often appear to see their roles to be that of “public watch dogs”, effectively promoting and raising awareness of the need for better community standards in the area of public accountability in business, reparation and sentencing etc. They most certainly do serve the “public good” and thec best of them receive journalism awards. The public needs to recognise the vital role they play in a free and democtatic society like ours in New Zealand. [Read more…]