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.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Tourism: China Southern Airlines To Fly To Christchurch

China Southern Airlines, in partnership with Christchurch Airport and the South Island tourism industry, has announced today it will begin flying directly between Guangzhou, Mainland China and the South Island. More>>

ALSO:

Dodgy: Truck Shops Come Under Scrutiny

Mobile traders, or truck shops, target poorer communities, particularly in Auckland, with non-compliant contracts, steep prices and often lower-quality goods than can be bought at ordinary shops, a Commerce Commission investigation has found. More>>

ALSO:

Auckland Transport: Government, Council Agree On Funding Approach

The government and Auckland Council have reached a detente over transport funding, establishing a one-year, collaborative timetable for decisions on funding for the city's transport infrastructure growth in the next 30 years after the government refused to fund the $2 billion of short and medium-term plans outlined in Auckland's draft Unitary Plan. More>>

ALSO:

Bullish On China Shock: Slumping Equities, Commodities May Continue, But Not A GFC

The biggest selloff in stock markets in at least four years, slumping commodity prices and a surge in Wall Street's fear gauge don't mean the world economy is heading for another global financial crisis, fund managers say. More>>

ALSO:

Real Estate: Investors Driving Up Auckland Housing Risk - RBNZ

The growing presence of investors in Auckland's property market is increasing the risks, and is likely to both amplify the housing cycle and worsen the potential damage from a downturn both to the financial system and the broader economy, said Reserve Bank deputy governor Grant Spencer. More>>

ALSO:

Annual Record: Overseas Visitors Hit 3 Million Milestone

Visitor arrivals to New Zealand surpassed 3 million for the first time in the July 2015 year, Statistics New Zealand said today. The record-breaking 3,002,982 visitors this year was 7 percent higher than the July 2014 year. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news