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

 


CORRECT: Ex-financial adviser ordered to pay $2.56M

CORRECT: Struck off financial adviser Robinson ordered to pay $2.56M to investor

(Corrects to show Mark Turnock facing charges under Financial Reporting Act in 13th graph in story that ran on July 18)

By Paul McBeth

July 18 (BusinessDesk) - Struck off financial adviser Andrew Robinson, who is separately accused of stealing investor funds, has been ordered to pay $2.56 million in damages plus costs to an investor over a series of negligent and misleading deals.

In the Auckland High Court, Justice John Fogarty made the order against Robinson, a former Sunday Star-Times columnist and adviser to Neville Mace and his family trust, over "six disastrous investments" which were "all made on the recommendation of Mr Robinson, as an investment advisor," according to a July 1 judgment, now published on the Justice Ministry's website.

Between 2008 and 2012, the Mace family trust made investments in NZX-listed electricity retailer Pulse Utilities, start-up investments Digi-Clik International, Zeroshift, bio-tech start-up Enviro Energy, and a loan to Pulse director James Martin on the advice of Robinson.

The judge said Robinson didn't provide any significant warnings around the risks involved in the start-up companies, and that when he said he was investing at a similar level, didn't disclose he was doing so by being paid in scrip for finding investors.

Of the four claims made under the Fair Trading Act, "the plaintiffs were induced to enter extremely high risk investments by reason of Mr Robinson, in trade, engaging in conduct that was misleading and deceptive and was likely to, and did, mislead or deceive Mr Mace in having a wholly inappropriate confidence in the merit of the investment," the judge said.

Robinson took advantage of the relationship he'd built with Mace and "relied on the personal confidence that Mr Mace had in him when making these recommendations to invest in these very high risk investments," the judge said.

Justice Fogarty also ruled Robinson was liable in the negligence for the advice he gave on all of the investments, which he said "falls well short of the quality of advice required in the circumstances by an investment advisor.

"But it is an incomplete description of Mr Robinson's conduct to describe it as a lack of proper care and attention or carelessness. It was deliberately misleading," the judge said. "To be sure, the deceptive and misleading conduct carried with it the consequence that Mr Robinson did not take reasonable care to avoid advice which would like cause financial harm to the Mace Trust."

Robinson represented himself and tried to characterise all equity investments as being aggressive, irrespective of the quality of the company, given their unsecured status.

"This absence of risk advice explains the importance of the distinction Mr Robinson endeavoured to maintain from the outset that any investment in equities is aggressive without distinguishing between investment in a proven performing 'blue chip' company and a listed start-up," the judgment said.

Justice Fogarty ordered Robinson to pay damages including interest of $400,000 for the Pulse dealings, $230,000 for the Digi-Clik investment, $30,000 for the loan to Martin via a trust, $1.1 million for the investment in Enviro Energy and $800,000 for the investment in Zeroshift.

If the Mace family trust is able to find a buyer for any of the securities it still holds, any value is to be credited against the judgment.

Separately, Robinson faces charges from the Serious Fraud Office accusing him of stealing $3 million of investor funds. He and fellow SPG Investments director Mark Turnock also face criminal proceedings brought by the Financial Markets Authority under the Financial Reporting Act. They're due to stand trial in the High Court in April next year.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Keep Digging: Seabed Ironsands Miner TransTasman Tries Again

The first company to attempt to gain a resource consent to mine ironsands from the ocean floor in New Zealand's Exclusive Economic Zone has lodged a new application containing fresh scientific and other evidence it hopes will persuade regulators after their initial application was turned down in 2014. More>>

Wool Pulled: Duvets Sold As ‘Premium Alpaca’ Mostly Sheep’s Wool

Rotorua business Budge Collection Limited (Budge) and sole director, Sun Dong Kim, were convicted and fined a total of $71,250 in Auckland District Court after each pleading guilty to four charges of misrepresenting how much alpaca fibre was in their duvets. More>>

Reserve Bank: Labour Calls For Monetary Policy To Expand Goals

Labour's comments follow a speech today by RBNZ governor Graeme Wheeler in which Wheeler sought to answer critics who variously say he should stop lowering interest rates, lower them faster, or that inflation-targeting should no longer be the primary goal of the central bank's activities. More>>

ALSO:

BSA Extension And Sunday Morning Ads: Digital Convergence Bill Captures Online Content

Broadcasting Minister Amy Adams has today announced the Government’s plans to update the Broadcasting Act to better reflect today’s converged market... The Government considered four areas as part of its review into content regulation: classification requirements, advertising restrictions, election programming and contestable funding. More>>

ALSO:

March 2017: Commerce Commission Delays Decision On Fairfax-NZME

The Commerce Commission has delayed its decision on the proposed merger between NZME and Fairfax Media's New Zealand assets, saying the deal is complex and it needs more time to assess the impact on both news content and the advertising market. More>>

ALSO:

Plan Plan: Permanent Independent Hearings Panel Proposed For Planning

The Productivity Commission recommends creating a permanent independent hearings panel like the one that cut through local politics to settle Auckland’s Unitary Plan, for the whole country. More>>

ALSO:

Statistics: NZ Jobless Rate Falls To 5.1% Under New Methodology

New Zealand's unemployment rate fell more than expected in the second quarter as Statistics New Zealand adopted a new way of measuring the labour market to bring the country in line with international practices, and while a growing economy continued to support jobs growth. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news