David Ross released from mental health care

David Ross, the man behind a suspected Ponzi scheme, has been released from hospital after being held under the Mental Health Act for the past three weeks.

His company Ross Asset Management is in receivership, with the first report from John Fisk of PwC finding that of the $450 million clients believed was being held on their behalf, only $10.2m exists.

In a statement released through his lawyers Chapman Tripp, Ross said he would "cooperate fully with all inquiries into his company and the funds invested with it".

Both the Financial Markets Authority and the Serious Fraud Office are investigating a scheme which PwC says has the characteristics of a Ponzi scheme - thought to be the largest in New Zealand history.

"While these matters are the subject of official inquiries, Mr Ross and his family will be making no further comment."

Meanwhile, receivers PwC has written to investors in Ross Asset Management saying the amount of assets it has managed to establish as existing has continued to increase slowly, to just over $11m, an increase of about $800,000 in the past week.

''We expect the amount to increase further but regrettably, based on the current information we have, we do not expect any increases to be significant, unless our inquiries of Mr Ross identify significant additional assets,'' the PwC letter stated.

The letter also warned that there was uncertainty over the $11m figure.

''It should be noted that many of the shares identified to date are held in smaller publically listed companies that can have a high level of price volatility or that may be infrequently traded.

''As a result of these factors, there remains a degree of uncertainty over the timing and level of any final realisations from the holdings.

''It is possible that the final sale value of the portfolio may be somewhat less than the figure stated above and may not be realisable for some time.''

The FMA said in a statement that it would update the High Court in Wellington on its progress in the case against Ross, where it will take to opportunity to recommend that some of the Ross entities be placed in liquidation.

''Liquidation will ensure that greater recovery powers can be used and some distribution to investors can then be made.  Investors' interests will be heard in that process.''

Contact Hamish Rutherford
Business reporter
Email: hamish.rutherford@dompost.co.nz
Twitter: @oneforthedr

The Dominion Post