Investors' complaint founders
A group of Hubbard investors' complaint to the Government has failed to bring about any action.
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 the attorney-general .
The group hoped the complaint, which was signed by 230 investors, would spur the Government to find an appropriate solution for all investors, while picking up the tab for management and legal costs which have reached $12 million.
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.
This week Investor Liaison Group spokesperson Noel Macpherson said they received a response from Mr Foss advising he would not be doing anything, while the Attorney General responded and referred to the statutory management of South Canterbury Finance, which is not the entity named in the complaint and has gone into receivership.
"The Attorney General's office said our complaint about the statutory management of South Canterbury Finance was outside its jurisdiction so we have written back and explained they had got it wrong," Mr Macpherson said.
"There is no end plan and two-and-a-half years later the costs are racking up and the litigation is stacking up which is all coming out of the investors' pockets."
The response from Mr Foss said the costs of the statutory managers were not excessive.
"I am advised that the hourly rates charged by the statutory managers are in line with those of other major South Island insolvency practitioners and that their administration costs have been independently reviewed. I understand that all expenses to date, including remuneration, are reported to have been reasonable and properly incurred.
"In relation to your concerns about the quality of the statutory managers' work, it is important that we all understand and appreciate how commercially complex the administration of Aorangi and HMF has been."
Overall there are around 700 investors owed $176m, of which at least 22 have died Mr Macpherson said. A number of investors have been interviewed by TV3's Campbell Live about their financial woes as a result of statutory management, and their problems are likely to air in the next week.
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