FMA to pursue Strategic Finance directors over 'likely' Securities Act breaches
Feb. 7 (BusinessDesk) - The Financial Markets Authority is preparing to file civil actions against the six directors of the failed finance company, Strategic Finance, saying it's concluded they are "likely to have breached the Securities Act".
The apparent breaches were in a prospectus, advertisement and investment statement issued between March and August 2008.
Strategic went into receivership in March 2010 owing approximately 11,000 investors $383 million, having been under moratorium arrangements since 2008.
The directors involved are Kerry Finnigan, Graham Edward Jackson, Marcel Aubrey Lindale, Timothy John Rich, Denis Grenville Thom and David John Wolfenden, the FMA said in a statement.
The directors are now to have an opportunity to respond to the FMA's proposed claim before civil proceedings are filed.
“FMA’s role as a publicly-funded litigant, acting in the public interest, necessitates this announcement to keep the market and investors informed,” said FMA Head of Enforcement, Belinda Moffat.
Strategic investors got a Christmas Eve distribution of 1.5 cents in the dollar, taking their return-to-date to 10 cents, and receiver John Fisk, from accounting firm PwC, estimates they will get between 12 percent and 20 percent of their original investment back.