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Statutory management for eight companies

20 June 2003 Media Statement

Statutory management for eight companies


Eight finance and property companies have been placed into statutory management, Commerce Minister Lianne Dalziel announced today.

This action follows an urgent meeting of the Prime Minister and senior Cabinet Ministers this morning, and was taken on the recommendation of the Securities Commission, Lianne Dalziel said.

The companies are CH Finance Limited, ICMG Leasing Limited, The Independent Creative Management Group Ltd, Toi Te Atatu Ltd, Sleinad Finance Company Ltd, Opol Ltd, ICMG Holding Ltd, and ICMG Property Company Ltd.

“These companies appear to have been operating ‘buy back’ schemes involving housing.

“Statutory management is used very rarely, and only where the government is satisfied that:

- the companies are, or may be, operating fraudulently or recklessly;
- it is considered necessary to protect interests of creditors or the wider public interest;
- it is necessary to prevent further deterioration of the companies’ finances.

“I received a report yesterday evening from the Securities Commission, recommending that action be taken on the basis these grounds had been met.

“The principal purpose of statutory management in this case is to limit the effects of any fraudulent or reckless act or activity and, to provide for the affairs of the companies to be dealt with in a more orderly way.”

Lianne Dalziel said statutory management was only proposed for a limited period to allow a full assessment of the position of the companies involved.

John Waller and Richard Agnew, from PriceWaterhouseCoopers in Auckland have been appointed statutory managers for the companies.

“The reason there has been such urgency around this matter, is because I understand that a tender process involving 10 properties would have concluded at 4pm today.

“That would have meant that the moratorium imposed by statutory management would have been ineffective against any sales that could have happened before Monday.

“I was not prepared to take the risk of waiting until Monday’s scheduled Cabinet meeting, hence the government’s urgent consideration of this matter. At the meeting of the Prime Minister and senior Ministers this morning, it was agreed that a special Executive Council be convened to approve the Order. This was held at midday and the Order in Council was made, the order being effective from 1pm.

“I am urging home owners affected by this or any similar ‘buy back’ scheme to come forward. There may be other companies that are involved that we don’t know about. We can’t investigate unless complaints are made.

“Today’s announcement shows that the government will act on the recommendations of the Securities Commission where it is satisfied that there are reasonable grounds to do so,” Lianne Dalziel said.

ENDS

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