Costs, delays quash $680,000 clawback
Statutory managers appointed to the late Allan Hubbard's Hubbard Management Funds have dropped attempts to claw back funds incorrectly distributed to investors.
Investors in HMF believed, according to reports issued by Hubbard, their funds were worth $80 million.
But statutory managers Grant Thornton, appointed in June 2010, have since discovered significant discrepancies between the investment statements and the $45m worth of assets held by HMF and available for realisation.
The shortfall, and individual investor statements apparently showing individual asset portfolios, has complicated repayments to investors with High Court action ongoing since early 2011 to determine how HMFs assets should be carved up.
In April the High Court ordered a $12m distribution to investors, but subsequent calculations showed $680,000 had been overpaid, with five investors receiving the bulk of the extra cash.
In a decision released earlier this month, Justice Lester Chisholm of the High Court in Timaru said Grant Thornton had dropped efforts to claw back the $680,000.
The move came after concerns ongoing legal action would cost more than it would recoup, and potentially lead to a further year of delays while the matter was before the Courts.
The judgment said HMF was solvent only until March 31, 2007. "The fund was solvent at that time even if individual statements might not have been completely accurate."
Investor balances at this date will be used to determine how future asset recoveries by Grant Thornton are to be distributed.
- This story has been corrected