Lombard directors pay $10m to settle claim
Directors of failed finance company Lombard Finance & Investments have paid $10 million to settle a civil claim they breached directors duties.
The settlement, announced in a statement by Lombard receivers John Fisk and Colin McCloy of PriceWaterhouseCoopers, is equivalent to 9 cents for every dollar lost by investors.
The Financial Markets Authority, which had been pursuing a parallel claim to that of receivers against directors Sir Douglas Graham, Michael Reeves, William Jeffries and Lawrence Bryant, discontinued its action as a condition of a settlement.
Fisk and McCloy said that with the receipt of the $10m the final expected outcome for investors from the receivership was returns of about 25 cents in the dollar.
The settlement involved an agreement with Lombard directors, their insurers and an unnamed third party.
Fisk said the settlement was a welcome outcome.
"It is pleasing to be able to complete one of the remaining significant issues in the receivership, and to be in a position to make a distribution sooner than would have otherwise been the case," he said.
"A key factor in the settlement decision was balancing the time, costs and risks associated with litigation when compared to the certain outcome today."
The Dominion Post