tmmonline.nz  |   landlords.co.nz        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Last Article Uploaded: Monday, March 1st, 7:29PM

News

rss
Latest Headlines

Commission bans contributory mortgage broker

The Securities Commission has banned Contributory Mortgage Investments Ltd (CMI) from acting as contributory mortgage broker for two of its mortgages.

Wednesday, December 20th 2006, 6:24AM
Crichton Horne & Associates Mortgage Brokers has been appointed as contributory mortgage broker for these mortgages.

CMI has also been banned from offering interests in contributory mortgages to the public for four months. During this time the commission will continue to review CMI’s operations to determine whether any other action should be taken.

The commission considers CMI breached the Contributory Mortgage Regulations in relation to the two mortgages, which were the Otahuna Property Limited first and second mortgages, by:

  • paying investors’ money to the borrower when it ought to have known that the offer document for the Otahuna first mortgage was misleading as it failed to disclose that the security for the first mortgage was limited to a priority amount; and by
  • failing to notify investors of the borrower’s default and the action CMI was taking in respect of the default, within a reasonable time.
“CMI has not met the standards of care and good governance expected of those who raise funds from the public. It is in the public interest to prohibit further fundraising until the extent of CMI’s failure to comply with the law is fully established,” Commission chairman Jane Diplock says.

CMI told the commission about its failure to disclose that the security for the first mortgage was limited to a priority amount and admitted it has a conflict of interest in the continued management of these mortgages. CMI’s failure to disclose to first mortgage investors that their security was limited to a priority amount may give grounds for an action against it by those investors. In these circumstances although CMI proposed steps intended to manage the conflict the commission considers that the only realistic way to manage a conflict of this nature is for an independent party to represent the interests of investors.

CMI has a history of securities law breaches. In 2004 it was convicted for providing misleading information to investors in relation to a contributory mortgage and for paying investors’ money to a borrower when there were insufficient funds to complete the development for which the money was being lent, events occurring in 2000.

Earlier this year the commission accepted an enforceable undertaking from CMI in relation to events occurring in 2004 and 2005.

« Macquarie signs up to AegisSovereign takes regulation bull by the horns »

Special Offers

Commenting is closed

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
Subscribe Now

Weekly Wrap

Previous News

MORE NEWS»

Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA 4.55 ▼2.29 ▼2.59 ▼2.65
ANZ 4.44 2.89 3.25 3.39
ANZ Special - 2.29 2.69 2.79
ASB Bank 4.45 2.29 2.59 2.65
Bluestone 3.49 3.34 2.99 3.34
BNZ - Classic - 2.29 2.59 2.79
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
BNZ - Std, FlyBuys 4.55 2.89 3.19 3.39
BNZ - TotalMoney 4.55 - - -
CFML Loans 4.95 - - -
Lender Flt 1yr 2yr 3yr
China Construction Bank 4.49 4.70 4.80 4.95
China Construction Bank Special - 2.65 2.65 2.80
Credit Union Auckland 5.45 - - -
Credit Union Baywide 5.65 3.95 3.85 -
Credit Union South 5.65 3.95 3.85 -
First Credit Union Special 5.85 2.95 3.45 -
Heartland Bank - Online 2.50 1.99 2.35 2.45
Heretaunga Building Society 4.99 3.50 3.40 -
HSBC Premier 4.49 2.25 2.35 2.65
HSBC Premier LVR > 80% - - - -
HSBC Special - 1.99 - -
Lender Flt 1yr 2yr 3yr
ICBC 3.69 2.25 2.35 2.65
Kainga Ora 4.43 2.79 3.04 3.13
Kainga Ora - First Home Buyer Special - 2.25 - -
Kiwibank 3.40 3.20 3.50 3.50
Kiwibank - Offset 3.40 - - -
Kiwibank Special 3.40 2.35 2.65 2.65
Liberty 5.69 - - -
Nelson Building Society 4.95 3.20 3.24 -
Pepper Essential 4.79 - - -
Resimac 3.39 3.35 2.99 3.35
SBS Bank 4.54 2.79 2.79 3.15
Lender Flt 1yr 2yr 3yr
SBS Bank Special - 2.29 2.29 2.65
Select Home Loans 3.49 3.34 2.99 3.34
The Co-operative Bank - First Home Special - 2.09 - -
The Co-operative Bank - Owner Occ 4.40 2.29 2.59 2.79
The Co-operative Bank - Standard 4.40 2.79 3.09 3.29
TSB Bank 5.34 3.09 3.29 3.45
TSB Special 4.54 2.29 2.49 2.65
Wairarapa Building Society 4.99 3.55 3.49 -
Westpac 4.59 3.09 3.29 3.39
Westpac - Offset 4.59 - - -
Westpac Special - 2.29 2.69 2.79
Median 4.55 2.79 2.99 2.80

Last updated: 26 February 2021 11:27am

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox
 
Site by Web Developer and eyelovedesign.com