Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


UPDATED: Ross Asset investors want liquidation tender

UPDATED: Ross Asset investor group wants liquidation put out for tender as Dec. 10 hearing date set

(Adds details of receivers costs, memo starting in third paragraph)

By Jonathan Underhill

Nov. 26 (BusinessDesk) - A group of investors in the failed Ross Asset Management group has asked the High Court to be admitted as a party to proceedings and called for the liquidation of the companies to be put out to tender.

A tentative new date of Dec. 10 has been set for the Financial Markets Authority to update the High Court on the Ross Asset Management receivership, by which time receivers PwC is expected to have applied to liquidate the group.

At a brief hearing in the High Court at Wellington today counsel for receivers John Fisk and David Bridgman of PwC sought an order allowing them to sell property owned by the Ross Group to the extent necessary to pay their fees up until Nov. 12 of $153,683. There were insufficient liquid assets from the group’s owner David Ross. Fisk told BusinessDesk said the application to put the group into liquidation would be made this week.

Also at the court today, Bruce Tichbon, who represents more than 50 percent of investors in Ross’s group of investment companies, sought to be admitted to proceedings. Tichbon told BusinessDesk he was concerned his group wasn’t being kept in the loop.

In Tichbon’s memo to the court he also sought for any liquidation to be put out to tender with a clear brief on strategy and costs.

Members of his group had observed receiverships and liquidations “where professional fees have devoured all the money left over,” he said. The tender for liquidation should clearly state “how investors’ interests will be represented.”

The receivers’ memo said both receivers and counsel “are very conscious of costs given the overall circumstances” but the receiverships to date had been “challenging” due to David Ross’s unavailability while in hospital after three weeks of compulsory treatment under the Mental Health Act and work was needed “to verify assets, recreate cash flows and consider legal options and avenues of recovery.”

Wellington fund manager Ross, whose businesses were frozen after missing investor payments, told PwC on his release from hospital not to expect to find any assets other than the $10.2 million plus $200,000 in cash deposits initially identified by Fisk and Bridgman.

The Serious Fraud Office launched a formal investigation this week, having helped the Financial Markets Authority with its own inquiries since Oct. 25.

Ross, formerly a share broker, managed funds on behalf of 900 privately wealthy individuals, with management fees averaging $4.4 million a year paid in each of the last three years.

The PwC investigation found inadequate record-keeping and has been unable to source much of the documentary evidence for trading and investment holdings that it needs to complete a full picture of what looks to have the characteristics of a Ponzi-style scheme, where investors were paid out at least in part using other investors’ funds.

It suspects many or most of the trading history disclosed to clients was “fictitious.”

The Ross group’s database purports to show investments worth $449.6 million, of which $152.4 million is said to be held in Australian investments, another $136.1 million in Canada, some $156.4 million in the US, $3.8 million in New Zealand, and $943,332 elsewhere. Of this, some $437.6 million was held by a Ross group subsidiary, Bevis Marks.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Half Empty: Fonterra's 2017 Opening Forecast Below Expectations

Fonterra Cooperative Group raised its forecast farmgate milk payout for next season by less than expected as the world's largest dairy exporter predicts lower prices will crimp production and supply will pick up. The New Zealand dollar fell. More>>

ALSO:

Pest Control: Mouse Blitz Team Leaves For Antipodes

The Million Dollar Mouse project to rid Antipodes Island of mice is underway with the departure of a rodent eradication team to the remote nature reserve and World Heritage Area. More>>

Gongs Got: Canon Media Awards & NZ Radio Awards Happen

Radio NZ: RNZ website The Wireless, which is co-funded by NZ On Air, was named best website, while Toby Manhire and Toby Morris won the best opinion general writing section for their weekly column on rnz.co.nz and Tess McClure won the best junior feature writer section. More>>

ALSO:

Pre-Budget: Debt Focus Risks Losing Opportunity To Stoke Economy

The Treasury is likely to upgrade its forecasts for economic growth in Budget 2016 next week but Finance Minister Bill English has already signalled that more of his focus is on debt repayment than on fiscal stimulus or tax cuts... More>>

ALSO:

Fulton Hogan's Heroes: Managing Director Nick Miller Resigns

Fulton Hogan managing director Nick Miller will leave the privately owned construction company after seven years in charge. The Dunedin-based company has kicked off a search for a replacement, and Miller will stay on at the helm until March next year, or until a successor has been appointed and a transition period completed. More>>

ALSO:

Gordon Campbell: On Electricity, Executions, And Bob Dylan

The Electricity Authority has unveiled the final version of its pricing plan for electricity transmission. This will change the way transmission prices (which comprise about 10% of the average power bill) are computed, and will add hundreds of dollars a year to power bills for many ordinary consumers. More>>

ALSO:

Half Empty: Fonterra NZ, Australia Milk Collection Drops In Season

Fonterra Cooperative Group says milk collection is down in New Zealand and Australia, its two largest markets, in the first 11 months of the season during a period of weak dairy prices. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news