Strategic directors to pay $22m

Directors and auditors of Strategic Finance will pay the company’s receivers $22 million in a settlement deal.

Thursday, June 5th 2014, 12:58PM 1 Comment

The Financial Markets Authority and receivers John Fisk and Colin McCloy announced today they had finalised the settlement.

It will allow them to make another distribution to investors.

The directors, Kerry Finnigan, Graham Edward Jackson, Marcel Aubrey Lindale, Timothy John Rich, Denis Grenville Thom and David John Wolfenden, have given the FMA an undertaking they will not act as a director or promoter of a public issuer of securities for five years, or act as a chief executive officer or chief financial officer of a public issuer of securities for three years, without written approval from the FMA.

In February 2013, FMA announced its investigation into Strategic found the directors were likely to have breached the Securities Act by making untrue statements in a registered prospectus, investment statement and in an advertisement between March 2008 and August 2008.

Separately, the receivers have pursued claims against the directors, including under the Companies Act 1993, and against the auditors in respect of the December 31, 2007, audit.

“In reaching this settlement we are providing certainty and compensation to investors. We have also been mindful of avoiding a lengthy and costly court case, with potential litigation risk.  The terms of the settlement deliver a strong deterrence message and include enforceable undertakings from the directors of Strategic not to act as a director of an issuer of securities to the public for five years,” said FMA director of enforcement and investigations, Belinda Moffat.

“While the directors do not admit liability, FMA remains of the view that they are likely to have breached their disclosure obligations under the Securities Act,”  she said.

“However, given the limited personal assets of the directors, this settlement represents the best outcome for investors in the circumstances.”

The settlement resolves all claims as between FMA, the receivers, liquidators, trustees, directors and auditors.

The settlement sum will be paid over the next six months to the receivers, who will distribute funds to investors in the same manner that the receivers will distribute proceeds from the realisation of assets in the receivership.

« Advisers promoting ETFsIFA working on pro-bono offering »

Special Offers

Comments from our readers

On 7 June 2014 at 12:49 pm Ivan said:
The question that needs to be asked is why has it taken seven years for this to happen. Statute of limitations nearly up maybe.

Sign In to add your comment

www.GoodReturns.co.nz

© Copyright 1997-2020 Tarawera Publishing Ltd. All Rights Reserved