Hotchin’s assets frozen in ‘preventative’ move by regulator

Hotchin’s assets frozen in ‘preventative’ move by regulator

By Paul McBeth

Dec. 15 (BusinessDesk) – The Securities Commission has won a High Court order freezing assets associated with former Hanover Finance boss Mark Hotchin.

The regulator’s application was granted without notice to Hotchin on Friday, and he intends to apply to revoke the order, the commission said in a statement. The Securities Commission took the action to help meet any successful civil claims brought by investors in Hanover and United Finance, which couldn’t meet payments on about $400 million of debentures.

“The commission decided to take this action against Mr Hotchin after deciding it was in the public interest to do so, enabling us to preserve assets from being sold or transferred,” chairman Jane Diplock said.

Last month, the regulator took the unusual step of making a public statement updating the Hanover investigation, saying it would decide whether to lay charges against the directors of Hanover and its affiliates by Christmas.

The commission said today’s announcement is “purely preventative” and doesn’t indicate civil or criminal liability. It is still investigating Hanover.

This comes after the regulator opened up the extent of its probes into failed financiers earlier this month, when it gave a step-by-step list of how it goes about its investigations and provided an update on the status of its 50 investigations.

Hanover is also the subject of a Serious Fraud Office investigation, which is focusing on the dividend payments and other transactions made immediately before the debt-for-equity swap to Allied Farmers Ltd., which shifted responsibility for the failed lender away from Hotchin and his partner, Eric Watson.

The SFO investigation came after a spat broke out between Allied’s Rob Alloway and the former Hanover directors over the terms of their agreement.

(BusinessDesk)

© Scoop Media