Hubbard investor group on offensive

Last updated 05:00 08/11/2012
Allan Hubbard
JOHN BISSET/Timaru Herald
COMPLAINT LAID: Angry Allan Hubbard investors have complained to the Government.

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Shots continue to be fired between Hubbard investors and statutory managers following a complaint to the Government.

The Investor Liaison Group laid a complaint with the Government about the conduct of statutory managers Grant Thornton which was sent to Commerce Minister Craig Foss and Attorney-General Lyn Provost last week.

It is signed by all six of the group's members and undersigned by 230 investors. Overall there are around 700 investors.

Aorangi Securities and Hubbard Management Funds (HMF) were put into statutory management along with Allan and Jean Hubbard on June 20, 2010. Mr Hubbard has since died.

Following the complaint, this week Grant Thornton referred to the group as the "unofficial investor liaison group".

Investor Liaison Group spokesperson Noel Macpherson said the statutory managers were trying to discredit them, after initially setting the group of six members up and detailed when and how they were to met.

"We asked to meet with the managers because the investors questions were just being fobbed off. We wanted to be the conduit between the managers and investors. They agreed to set up the investor liaison group and even went to their lawyers and had an agreement as to how it would work.

"Now they have said we are an unofficial group which is just more of them twisting words which they have done since day one."

Grant Thornton said they were "unofficial" because they were self appointed.

"The statutory managers agreed to work with them to help explain the complexities of the statutory management.

"We have no legal deed to govern activities, but we did agree on some basic rules of engagement."

The complaint also alleged HMF had lost $40 million under the control of Grant Thornton, an allegation the managers strongly reject with their figures showing it had lost $4m under its management.

"As at March 2010, the fair value of the identified assets of HMF was $60m not the $83m reflected on Mr Hubbard's statements to investors. He had overstated the value of the fund by $23m. This value is after recognition of a loss of over $4m on an investment in Southbury Group, a company controlled by Mr Hubbard," a statement from Grant Thornton said.

"Since that date a further cash shortage of $6.5m has been identified after another related party transaction was investigated. Additionally, a further $7m of assets are being claimed by financiers and the Hubbard family.

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"The remaining $4 million (taking the total to $40m) represents a variety of market movements and costs over the period."

- The Timaru Herald


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