Ross victims face 97pc loss of funds

HAMISH MCNICOL
Last updated 05:00 20/08/2014
david ross
CHRIS SKELTON/Fairfax NZ
FOUND GUILTY: David Ross in court.

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Less than three cents in the dollar is all victims of fraudster David Ross can expect in the final wash-up, after his last property was sold for a knockdown price.

Out-of-pocket investors are left scratching their heads about what happened to the other 97c, in what one called a hopeless saga.

There is still a chance more money could be clawed back from other investors who cashed up before the Ross fraud was uncovered.

As things stand now, about $3 million is left for the hundreds of investors swindled out of $115m by Ross, the man responsible for New Zealand's single-biggest fraud.

In November, Ross, 64, was jailed for 10 years and 10 months for operating a fraudulent scheme in which private investors lost about $115m.

His company, Ross Asset Management (RAM), fleeced at least 700 investors through portfolios in which they thought they had more than $380m.

The sale of the third and final property formerly owned by the fraudster has been confirmed, for $85,000.

The 1321 square metre section offering "sensational unrestricted views" in the Wairarapa coastal settlement of Riversdale Beach has a rateable value of $175,000.

Its sale, along with two other properties owned by Ross, some household assets, and shares owned by his various companies, have recouped about $3m for investors.

PricewaterhouseCoopers receiver John Fisk said there were still some shares to be sold but it was "down to the end of things".

Some were held up in Canadian share registries and others were still subject to proprietary claims by others who thought they had a right to own them. If these claims are unsuccessful the shares could be available to the general pool of creditors.

"It's very difficult to put a value on what might come in but we're not expecting a lot more . . . we're not talking about multiple millions," Fisk said.

RAM Investors Group head Bruce Tichbon said if there was about $3m left, investors were looking at getting about three cents in the dollar back. "Who has the other 97c? Where does it go?"

Fisk was, however, preparing to claw back up to $25m from investors who withdrew money from the Ponzi scheme before it collapsed.

If test claims against three investors who withdrew $3.8m in fictitious profits were successful, he would use the precedent to chase about two dozen investors who made withdrawals in the two years before the scheme's collapse.

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Tichbon said the prospect of clawback was the only light left.

Last month a beach house previously owned by Ross sold for $828,000 - $138,000 more than its rateable value - with all the money going to defrauded investors.

When Ross's mansion in Woburn, Lower Hutt, was sold for $1.77m early this year, half the proceeds went to wife Jillian, upsetting his victims.

- The Dominion Post

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