A series of trusts run by South Canterbury Finance Rich Lister Allan Hubbard – plus the personal assets of Mr Hubbard himself and his wife Margaret – have been placed in statutory management by Commerce Minister Simon Power this afternoon, and
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A series of trusts run by South Canterbury Finance Rich Lister Allan Hubbard – plus the personal assets of Mr Hubbard himself and his wife Margaret – have been placed in statutory management by Commerce Minister Simon Power this afternoon, and are to be investigated for potential breaches of the Crimes Act.
The government has placed Aorangi Securities, seven charitable trusts, the Hubbards into statutory management, Mr Power said at a 4.30pm press conference.
Aorangi Securities is solely controlled by Mr Hubbard and his wife via their ownership of its parent company, Forresters Nominee Company Limited.
The Crown has moved to protect around $134 million of investors' funds.
Mr Hubbard became only the fourth New Zealand citizen to have his personal assets put under statutory management.
The 82-year-old is currently undergoing kidney dialysis. His wealth was put at $550 million on last year's NBR Rich List.
Troubled South Canterbury Finance, with which Mr Hubbard is closely associated, is not part of the statutory management order.
The charitable trusts are: Te Tua Charitable Trust, Otipua Charitable Trust, Oxford Charitable Trust, Regent Charitable Trust, Morgan Charitable Trust, Benmore Charitable Trust, Wai-iti Charitable Trust.
"My action follows a recommendation from the Securities Commission, and I advised a meeting of the Acting Prime Minister and senior Cabinet Ministers of my decision at 2pm today," Mr Power said.
"The registrar of companies has referred a number of matters relating to Aorangi Securities Ltd to the Serious Fraud Office to investigate potential breaches of the Crimes Act.
"The recommendation of statutory management was the result of careful consideration by the Securities Commission.
"The decision to place these entities under statutory management is being taken pursuant to section 38 of the Corporations (Investigation and Management) Act 1989, and is effective from 3.30pm today.
"It follows a process that took a number of weeks and involved the Companies Office and Mr Hubbard.
"The main objectives are to prevent fraud and reckless company management, to protect investors and to enable the orderly administration of a company's affairs.
"The commission considered other remedies.
"But given the circumstances of this case, that Mr and Mrs Hubbard are involved in the affairs of the entities as depositors, managers, and borrowers, and that loans to related parties have not been properly secured and documented, it was felt statutory management was the only option.
"The commission was satisfied on reasonable grounds that Mr and Mrs Hubbard are so closely connected with the business and affairs of the entities that the statutory managers would be unable to effectively exercise the powers conferred by the Corporations (Investigation and Management) Act 1989 unless they are also declared subject to statutory management."
The government has appointed Trevor Thornton and Richard Simpson of Grant Thornton as statutory managers.
"These decisions have been taken to protect investors, and the matters are now in the hands of the statutory managers and the Serious Fraud Office," Mr Power said.
"I am advised that the statutory manager will be in touch with investors shortly."
