My Hanover fears - Sir Tipene O'Regan
Hanover director Sir Tipene O'Regan has spoken for the first time about civil proceedings filed against six Hanover Finance group figures, which he says will be "strongly defended".
He also tells of his fear that the case, regardless of the result, will wipe him out financially.
Sir Tipene and his wife Lady Sandra live in a property he describes as un-saleable and un-mortgageable in an earthquake orange zone on Christchurch's southshore.
Speaking exclusively to NBR Online, Sir Tipene, the professional company director who founded Ngai Tahu Holdings Corporation, says he was aware before Sunday the Financial Markets Authority was about to make an announcement on civil action, which was foreshadowed just before Christmas.
However, even after FMA chief Sean Hughes's announcement on TVNZ's Q+A, it was some time before he had a copy of proceedings "in my hands", he says.
"I'm naturally disappointed [the FMA action is being pursued], also moderately disappointed at the manner in which it was presented to the public," he tells NBR.
"It was a whole PR staging of these things. But we're becoming accustomed to that now."
Sir Tipene did not want to talk about the allegations themselves before receiving legal advice, but he says they will be "strongly defended".
"In my view, we did a pretty good job in a very difficult situation and for that reason I believe the allegations contained in these proceedings must be resisted."
He instructed lawyers some time ago and "they're reviewing the documents as we speak", he says.
"But my understanding is that it will be well after Easter before we've got a clear picture from our legal advisors as to what the substance of the allegations is."
At this stage, former Hanover directors have sought legal advice independently, but Sir Tipene says they are discussing the possibility of being represented as a group.
"Generally, everyone is first trying to get a clear picture of what is alleged, but I've had no conversations, apart from cordial good wishes, from either Eric Watson or Mark Hotchin."
'This is enough to wipe me out'
Speaking of his own circumstances, Sir Tipene (72) says his primary concern is for his wife, Sandra, and he fears the legal action could sink them financially.
"We're getting a bit senior for this sort of thing.
"We're not wealthy people, but by the same token, hey, we're not broke - I'm not pleading poverty."
Sir Tipene says the couple have fairly modest, family-owned assets - a house in Christchurch's earthquake-battered eastern surburbs, a holiday apartment and a "rather old" boat.
Fighting the case will "absolutely" be a stretch, Sir Tipene says.
"This is enough to wipe me out, just on legal costs, even if we're successful."
Sir Tipene, an elder statesman who straddles New Zealand's cultural diversity, rose to prominence as a Maori fisheries negotiator in the 1980s, and played a central role in Treaty fisheries settlements of 1989 and 1992.
He was chairman of the Treaty of Waitangi Fisheries Commission - Te Ohu Kai Moana - for many years.
He led Ngai Tahu claim settlement negotiations in the 1990s and was knighted in 1994.
On Sunday, FMA chief Sean Hughes announced on television civil proceedings had been filed against directors and promoters of Hanover Finance, Hanover Capital and United Finance.
Proceedings under the Securities Act, taken against Sir Tipene, Mark Hotchin, Eric Watson, Greg Muir, Bruce Gordon and Dennis Broit, relate to statements made in the December 2007 prospectuses, subsequent advertising and the March 2008 prospectus extension certificate.
The FMA is seeking declarations, pecuniary penalty orders and compensation for investors who made investments during the period from December 7, 2007, to July 22, 2008.
During this period new investments and reinvestments totalled $35 million.
Hanover and United Finance froze $554 million of investor funds, from around 16,000 investors, in August 2008.
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Comments and questions21
Another case like Doug Graham of allowing a good name and distinguished career to be used.
Did Mr O'Regan check Eric Watson's background and how Mr Watson is all for himself?
What expertise did Mr O'Regan think he could bring to Hanover?
Bear in mind that the name Hanover (and Lombard for that matter) was used to falsely convey the impression of financial strength and experience.
Tipene has it right. Sean Hughes appearance on Q&A was a complete PR stunt and seems more focused on playing up to the media than actually looking at doing things properly and treating people like Sir Tipene with the respect that he has clearly earned.
People seem to conveniently forget that there was a global financial crisis that wiped out over 60 finance companies here in NZ. It would be stretch to say that all these companies had bad directors.
Tipene earned the respect for championing Maori rights and causes.
What has that respect got to do with being on a board of a finance company? What financial expertise did Tiny had?
Well, it's called being out of depth and selling that respect - resulting in hundreds of millions of savings lost and some pensioners losing their life's savings.
Tipene was sucked in by the perks of the boardroom.
Did he actually think it was okay for Hanover to take money from the public, and for Eric and Mark to use that money for property and investment speculation?
Boo Hoo Tipene
How do you think the Hanover investors feel after they lost millions - some of them lost their whole retirement funds because they thought you were going to look after it for them - how disappointed they were when you and the rest of your board failed them.
You talk about Sean Hughes' PR campaign - what are you now doing
AS you will knoe Tipene - youa re only as good as your last deal
Boo hoo hoo - I can't stop the tears of joy that finally you and others in the finance sector are paying for your sins
Go forward SFO and FMA and multiply your success
Happy Easter Tipene, Mark and Eric and for that matter the Strategic Finance boys
By next Easter you will hopefully have been found guilty of your sins and never again be allowed near investors money - and hopefully most if not all of your assets have been redistributed to those you sinned against.
Well said, Doc.
Disgraceful the crocodile tears now pouring out from the likes of Tipene and Doug Graham.
Bet you that there were crying into their champagne and caviar when they were enjoying the perks of the boardroom.
If you are going to be on a board, do your job!
Doug Graham - director of a finance company with a Maserati-for-a-comapny-car driving CEO.
Tipene - director of a finance company with two directors helping themselves to investors' deposits via related party transactions to fund speculative investments.
What the hell were you doing? Sleeping after getting drunk on the champagne before and during the board meeting?
It is disappointing to see people gleeful about Sir Doug Graham or Sir Tipene O'Regan going down with these finance companies. I think everyone senses they were clueless and were also victims of some very, let's say "clever" owners who were running something tantamount to a ponzi scheme. The two Sirs and others allowed themselves to be used to legitimise this scheme, which in the case of Hanover resulted in some $90,000,000 (?) odd in dividends being paid to Hotchin and Watson in the 2 years leading up to the moratorium. The great sadness for these distinguished knights, and a good man like Greg Muir for that matter, is that confronted now with the ocnsequences of having been used and duped this way, they all again take Hotchin and Watson's lead to say they will "vigorously defend" proceedings. C'mon. Who are they trying to kid? Better late than never, these good men should take the opportunity to stand up and say "bloody good job that we're being sued for the greater good, we're indemnified by the company, and as a matter of honour we standby the Hanover victims against the likes of the hoods that duped both them and us". Sir Tipene, stand up! Greg Muir, stand up! Bruce Gordon, stand up! Think of all the old folk who are living in poverty now having lost their savings in Hanover.
Again, the clueless envy mongers here, in their hate of personalities, are prepared to sacrifice the freedoms of us all pertaining to the underlying principles of freedom the State is running roughshod over with this FMA action.
These cases are indicative of arbitrary government operating on whim: for example, Hotchin's assets frozen, then why not the other defendant's here? Because apparently government chained itself to the vigilantes in New Zealand ... there can be no other reason. None of us are free, or safe, with a government operating on this basis.
O'Regan also makes a very good point about the PR staging of 'these things': very reminiscent of Soviet styled show trials if you think about it.
Tribeless - if the FMA don't sue these buggers who will?
If there one good thing that hopefully comes out of the finance company mess it should be that all company directors realise they have responsibilities as directors and they are not just there to collect their director's fees.
Tribeless, the FMA and SFO have limited resources, we all do. And when faced with limited resources someone in each organisation has to pick the best targets to go for. It is simple business practice, go for the low hanging fruit, then keep going after the next easiest target, always with an outcome in mind.
Win the case, Set the precedent, Show others that the risks of breaking the rules are not negligible, in fact the risks are clear and present. Basically bring the perpetrators to account and where possible ensure they do not get to keep ill gotten gains.
Tipene is going to find that swimming amongst sharks is a very dangerous pass time. At some stage in 2005, or 2006 it might have been fun to rub shoulders with some heavy weights, but now when it comes time to stand and be counted they will eat you for breakfast. Eric, Mark, and all the others have no moral compass, they could not care less about collateral damage.
Alex, your point about directors fees is true, they can collect fees but just remember that tagged to those fees is a long term liability that goes way beyond the monetary offset.
There's an old political saying of "where you in the room at the same time?" which is relevant here.
While that defence is pulled out when accused of, say s******g the young secretary, it is also applicable and should be considered before people go racing off and personally attacking the directors.
To imply that the directors didn't apply themselves lacks a clear understanding of the situation they were in way back in 2007/2008. It's very easy now slagging them off with the benefit of hindsight.
But again, it comes down to "where you in the room at the time" line. If so, by all means comment, but if not... then its best to wait and let them have their day in court to defend themselves.
The FMA should do likewise, otherwise one suspects Crusher will come down on goodie-shoes Hughes (and ol Adam Feeley) and seek to merge the FMA and SFO into something more competent.
Lawyers, legal advisers, FA's etc have to take responsibility also. Some 80-90 elderly's capital was invested in these "high flying" companies. These elderly wouldn't have understood what a prospectus was.
Can't see a lot is going to change. Still too many gaps in legislation.
Wait another 20-30 years. Same ol, same ol!!
maybe he should change his name to Tupence - thats all that will be left
It's odd how some people feel that Tipene was duped. I'm not so sure, as is stated in the article "he led Ngai Tahu claim settlement negotiations in the 1990s" - on this basis you'd have to say he is a canny businessman and so knew exactly what he was getting into with Hanover. He may have sold his reputation, but he did so on his own terms.
Kiaora. You are absolutely 100 per cent correct .
Sir Tipene O’Regan: Ngai Tahu: born 1939
Company Director, Academic & Ngai Tahu Kaumatua
Sir Tipene O’Regan is currently Assistant Vice‐Chancellor (Maori) at the University of Canterbury. He was previously the founding Chairman of both Te Ohu Kai Moana (Treaty of Waitangi Fisheries Commission) 1989‐2000 and the reconstituted Sealord Group of companies (1993‐2002). From 1973 until 1996 he was a Member and then Chairman of the Ngai Tahu Maori Trust Board and led the Ngai Tahu land and sea fisheries claims before the Waitangi Tribunal culminating in the Tribunal’s supportive reports of 1990 and 1992. From 1986 he was a Maori Fisheries Negotiator and played a central role as architect of the historic Treaty fisheries settlements of 1989 and 1992. He led the
Ngai Tahu Claim settlement negotiations 1990‐1998 which resulted in legislative enactment in 1998.The Ngai Tahu Treaty settlement made extensive provision for customary rights in lands, fisheries and other natural resources as well as establishing the base of a tribal asset portfolio which currently stands in excess of $500 million.
A professional Company Director, Sir Tipene founded and then Chaired the Ngai Tahu Holding Corporation from its inception in 1991 until 2000 and remains a Director of a number of companies in the tourism, agricultural and natural resource sectors. He has been a Member of the NZ Fishing Industry Board and a Director of the NZ Seafood Industry Council Ltd and was previously a Board Member of the NZ Broadcasting Corporation and a long‐serving director of Television NZ Ltd.
He holds a well recognized place in NZ historical scholarship – marked by the University of Canterbury in 1992 by the degree of D. Litt (Hons Causae). He has written and lectured extensively in NZ and overseas where he has held a variety of academic fellowships particularly in association with the University of Canterbury where he taught post‐graduate History for many years. In 1994 he was the Lansdowne Fellow at the University of Victoria, British Columbia. He was the 1998 Macmillan Brown Lecturer at the University and in 2003 delivered the Hocken Lecture at the University of Otago. In 1999 he delivered the prestigious Cawthron Memorial Lecture and in 2004 the inaugural Canterbury Lecture. In 2007 he was invited to present the President’s Lecture of the Royal Australasian College of Surgeons.
In 2000 Sir Tipene was appointed a Senior Research Fellow at the University of Canterbury and,more recently, in 2004 became an Assistant Vice‐Chancellor in the University. From 1990‐1996 he was a Member of the NZ Conservation Authority and from 1995‐2001 he was an Executive Member of the Law of the Sea Institute. Since 1983 to the present he has been a Member of the NZ Geographic Board and from 2000‐2005 served as a Board Trustee of the Marine Stewardship Council(UK). He is an Honorary Lecturer and Adjunct Fellow of the Australian Maritime College where he teaches on the MBA programme. In 2005 he received the Centennial Heritage Award of the NZHistoric Places Trust in recognition of his many years of service to the protection of Maori heritage.
From 2000‐2005 Sir Tipene was a Director of Meridian Energy Ltd and from 2000‐2006 he was Deputy Chairman of the Transit NZ Authority, the nation’s highway funding and construction agency.He is currently Chairman of Clifford Bay Marine Farms Ltd and Australian Bight Aquaculture Ltd(Australia), a Director of the Hanover Financial Services Group of companies and a Director of Clean Seas Tuna Ltd (Australia). He is a Director (1988‐) of Whale Watch Kaikoura Ltd, Kutai Investments Ltd, Milford Dart Ltd and Hui Taumata Trust Ltd. In 2006 he was appointed a Director of Whai Rawa Funds Ltd, the Ngai Tahu tribal savings and superannuation scheme. He is a Member of the Advisory Board of the University of Otago Business School and in 2004 his standing in the business sector was recognised by Lincoln University which awarded him the Honorary Degree of D.Comm (Hons Causa). In 2006 Victoria University awarded him a second Honorary D.Comm.
In 1993 Sir Tipene was the National Business Review’s New Zealander of the Year and in 2001 he was elected a Distinguished Fellow of the Institute of Directors. The following year,
2002, his services to the seafood sector were recognized by the Supreme Award of the NZ Seafood Industry Council. In 2006 he assumed the Chair of Nga Pae o Te Maramatanga, the Centre for Maori Research Excellence based in the University of Auckland.
He is a past Trustee of the Prince of Wales Trust and continues as Patron of the Christchurch Arts Festival and as Patron of the Foundation for Research on Marine Mammals. He is the Upoko(traditional head) of the Awarua Runanga of Ngai Tahu. Sir Tipene was made a Knight Bachelor in1994.
So, Sir Tipene has had more than enough experience in business at the TOP and regardless of his chronologically challenged status - One Reaps what One Sows...Did he forget this?
"Aoraki Matatū…
Holding firm to what defines Ngāi Tahu"
"Ekea ka tiritiri o te moana…
Ascend to the heights of your aspirations"
Long way to fall from the Top of Te Maunga o Aoraki (Mt Cook), isn't it.
Now he worries for his wife. There are other wives out there if some have not passed away from stress, already with losing their life savings.
At the end of the day the only one you have to trust in, is yourself by deploying plain old common sense.
http://tinyurl.com/8y9gt3o
I think some of those screaming for blood here should reflect a little on what would happen if they had to sell their family home at short notice back in 2008. Me thinks perhaps there might have been a shortfall to their mortgage, maybe, hmmm?
A little honesty with circumstance and timing is called for before you cast the first stone!
For instance, did you know if you read your home mortgage you will find that your bank has the right to call up your mortgage at ANY TIME, whether you are ready or not, and without cause. Its to cover them for the RBNZ shifting the required cash reserve ratios. Think about that! That's what happened in 1987. Paid up mortgages were called up by their banks to fix the bank ratios. Did that happen here with some of the finance companies?
Trevor, how is this relevant to the article?
Hotchin and Watson must be loving the preceived heat shield/safety in numbers of being lumbered in there with honorable guys like Sir Tipene and Greg Muir! Is the Hanover Board going to end up more like Space Shuttle Columbia or Apollo 13? !