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FMA Files Civil Proceeding Against Individual For Making Alleged False Or Misleading Representations And Other Breaches

The Financial Markets Authority (FMA) – Te Mana Tātai Hokohoko – has filed civil proceedings against Rangi Wyatt Stephen Savage for making an unregulated public offer for the sale of shares in The Powder Shed Tokoroa Limited (Powder Shed). Mr Savage was the sole director of Powder Shed.

Mr Savage is accused of breaching the Financial Markets Conduct Act 2013 (FMC Act) by:

· Making false or misleading representations1

· Making a regulated offer without a Product Disclosure Statement (PDS)2

· Accepting an application for a transfer of financial products without a PDS3

Mr Savage is alleged to have made false or misleading representations between April and July 2020 in online presentations and social media videos when promoting the sale of shares in Powder Shed to potential investors. At no point during the time the offers were made was a PDS for the offer lodged or provided to investors.

More than 160 individual investors applied to purchase shares in Powder Shed. Approximately 65,000 shares in the company were sold and issued to investors at USD$1.20 per share. Investors paid in USD and in cryptocurrency. The total amount obtained equates to approximately NZD$122,000.

The FMA is seeking a declaration that Mr Savage breached the FMC Act, that Mr Savage pay compensation to investors, Mr Savage pay a pecuniary penalty to the Crown, and a banning order preventing Mr Savage from being a director or involved in the management of a company.

Notes

Sections of the FMC Act alleged to have been breached:

  • 1Section 22
  • 2Section 48(1)
  • 3Section 50
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