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


Ross Asset investors face 'gruesome legal fight'

Ross Asset investors face gruesome legal fight if Ponzi scheme shown

By Jonathan Underhill

Dec. 4 (BusinessDesk) – Investors in Ross Asset Management face a “gruesome legal fight” to recover their funds if investigations by regulators show fund principle David Ross was running a Ponzi scheme, says investor spokesman Bruce Tichbon.

The receivers of the Ross group yesterday applied to the High Court to liquidate the companies and a hearing date has been set for Dec. 17. Receivers have uncovered only about $11 million of the $449.6 million purported to be under management.

Tichbon is among investors who put money into David Ross’s funds on the recommendation of an adviser and the Financial Markets Authority wrote in a letter to him yesterday that it was “actively engaging with such advisers and will take appropriate action where, after investigation, any breaches are discovered.”

“Some people have done very well out of David Ross,” said Tichbon, who has lost almost $1 million. “There will be a terrible legal battle between those who put more money in and those who took more money out. First it has to be determined whether or not David Ross was running a Ponzi scheme.”

Tichbon represents more than 50 percent of the affected investors. In an effort to develop a strategy he has been in contact "with the people running the Madoff unwind" in the US. He declined to give details until the plan is developed. Bernie Madoff was jailed after pleading guilty to running the biggest Ponzi scheme in US history, involving billions of dollars.

In Tichbon’s case, Ross was recommended by a friend’s accountant though others may have been steered toward the funds by another Authorised Financial Adviser.

“This is how he seemed to operate,” Tichbon said. “Why have an expensive marketing campaign when word of mouth is bringing you clients anyway.”

Receivers John Fisk and David Bridgman of PwC yesterday sought the liquidation of four Ross companies – Ross Asset management, Bevis Marks Corp, McIntosh Asset Management and Mercury Asset Management.

They also flagged the liquidation of four more companies – Dagger Nominees, Ross Investment Management, Ross Unit Trust Management and United Asset Management by way of a special resolution of shareholders, acting through the receivers. Fisk and Bridgman are seeking to be appointed liquidators.

Tichbon said he has already written off his losses and any return “would be a bonus”.

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. Both the Serious Fraud Office and the Financial Markets Authority are investigating his companies.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Trade: NZ Trade Deficit Widens To A Record In September

Oct. 27 (BusinessDesk) - New Zealand's monthly trade deficit widened to a record in September as meat exports dropped to their lowest level in more than three years. More>>


Animal Welfare: Cruel Practices Condemned By DairyNZ Chief

DairyNZ chief executive Tim Mackle says cruel and illegal practices are not in any way condoned or accepted by the industry as part of dairy farming.

Tim says the video released today by Farmwatch shows some footage of transport companies and their workers, as well as some unacceptable behaviour by farmers of dragging calves. More>>


Postnatal Depression: 'The Thief That Steals Motherhood' - Alison McCulloch

Post-natal depression is a sly and cruel illness, described by one expert as ‘the thief that steals motherhood’, it creeps up on its victims, hiding behind the stress and exhaustion of being a new parent, catching many women unaware and unprepared. More>>


DIY: Kiwi Ingenuity And Masking Tape Saves Chick

Kiwi ingenuity and masking tape has saved a Kiwi chick after its egg was badly damaged endangering the chick's life. The egg was delivered to Kiwi Encounter at Rainbow Springs in Rotorua 14 days ago by a DOC worker with a large hole in its shell and against all odds has just successfully hatched. More>>


International Trade: Key To Lead Mission To India; ASEAN FTA Review Announced

Prime Minister John Key will lead a trade delegation to India next week, saying the pursuit of a free trade agreement with the protectionist giant is "the primary reason we're going" but playing down the likelihood of early progress. More>>



MYOB: Digital Signatures Go Live

From today, Inland Revenue will begin accepting “digital signatures”, saving businesses and their accountants a huge amount of administration time and further reducing the need for pen and paper in the workplace. More>>

Oil Searches: Norway's Statoil Quits Reinga Basin

Statoil, the Norwegian state-owned oil company, has given up oil and gas exploration in Northland's Reinga Basin, saying the probably of a find was 'too low'. More>>


Modern Living: Auckland Development Blowouts Reminiscent Of Run Up To GFC

The collapse of property developments in Auckland is "almost groundhog day" to the run-up of the global financial crisis in 2007/2008 as banks refuse to fund projects due to blowouts in construction and labour costs, says John Kensington, the author of KPMG's Financial Institutions Performance Survey. More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news