FMA closes four more finance company probes
FMA closes four more finance company probes, warns Allied Nationwide
Sept. 9 (BusinessDesk) - The Financial Markets Authority has warned the failed Allied Nationwide Finance for probably breaching securities law, but won’t pursue tougher action as it wraps up another four investigations into the collapsed finance sector.
The market watchdog won’t take enforcement proceedings against Allied Nationwide, Equitable Mortgages, LDC Finance or Irongate Property, and expects to make announcements on its remaining five cases before the end of the year, it said in a statement.
The FMA said Allied Nationwide was probably in breach of securities law and needed better disclosure, but weighing up the costs and public interest, decided a warning letter was enough sanction.
“The directors of these failed finance companies have been reminded of their obligations to comply with all financial markets legislation and we will continue to monitor their conduct within our general surveillance activities,” chief executive Sean Hughes said. “It is our expectation that the directors of these companies will disclose to the market the positions they held at the time of the collapse.”
The FMA inherited 25 investigations into failed finance companies from its predecessor organisation, the Securities Commission. Among the remaining firms still under investigation are St Laurence, Mutual Finance, OPI Pacific Finance, and Viaduct Capital.
The regulator is still in talks with the directors of Strategic Finance to negotiate a settlement of its civil proceedings, and is a party to the Serious Fraud Office’s prosecution of South Canterbury Finance. It is also pursuing a civil suit against the directors and promoters of Hanover Finance.