What a joke. The Securities Commission has investigated disclosures by NZX-listed Plus SMS and says it can’t do anything because at the time it didn’t have the powers.

Plus SMS has has cost investors millions of dollars since a backdoor listing using the shell of RetailX, in  late 2005. 

Here’s the full Securities Commission release:

“The investigation followed a notice given by the commission in September 2006, which resulted in Plus SMS correcting several earlier announcements.

These announcements related to certain contracts said to be held by Plus SMS and their effect on the company.

The commission considered the findings of the investigation in September 2007.

It found:

Company announcements made various claims about the benefits of contractual arrangements in circumstances where the company itself did not know whether the contracts in fact held any value.

There was no evidence of trading by insiders during periods when the market was misinformed about the contracts.

There was no evidence of an intention on the part of Plus SMS directors to deceive or mislead the market.

The commission did not investigate any possible market manipulation, since no relevant law regarding such behaviour was in effect until 29 February 2008.

The commission formed the opinion that there were breaches of continuous disclosure obligations by the company in 2006.

As the breaches occurred prior to 29 February 2008, there was no way to proceed against directors.

As the investigation did not disclose evidence of insider trading, and as actions for breaches of continuous disclosure could only at that time be taken against the company itself, to the cost of shareholders, the commission decided not to take court action in respect of the matter.

Thereafter the commission considered publication of a report on its investigation.

It heard submissions from certain affected parties. Not having found any actionable breach of the law during this process, the commission could not commit further resources in the light of significant enforcement work on other matters.

Recent events concerning Plus SMS, unrelated to the commission's investigation, have prompted the commission to issue this release.

Amendments to the continuous disclosure provisions in the Securities Markets Act came into force on 29 February 2008.

These changes allow the Commission to seek pecuniary penalties and compensation from individual directors and officers who are knowingly involved in any continuous disclosure breach.

The commission will not hesitate to take action in appropriate cases."