SFO alleges $1.7b fraud with South Canterbury Finance
December 7th, 2011 at 6:12 pm by David FarrarStuff reports:
SFO boss Adam Feeley confirmed the total estimated value of the allegedly fraudulent transactions was about $1.7 billion, which includes an esimated $1.59 billion from entering the Crown Retail Deposits Guarantee Scheme. …
“The collapse of SCF was one the most significant of all the failed finance companies. The value of the fraud alleged to have been committed exceeds anything in the history of white-collar crime in New Zealand, and the time we have taken to complete this matter is a reflection of that scale,” Feeley said.
The SFO spent 14 months investigating the company and the charges it has laid cover a variety of offences, including theft by a person in a special relationship; obtaining by deception; false statements by the promoter of a company; and false accounting. The offences carry maximum penalties of between seven and ten years imprisonment.
“It is not appropriate at this point to comment on details of the allegations, but the investigation itself has been one of the most resource-intensive and time-consuming in recent history,” Feeley said.
SCF founder and chairman and Allan Hubbard, was facing 50 fraud charges relating to his private investment vehicles Aorangi Securities and Hubbard Management Funds, but was killed in a car accident in September.
This won’t restore the money to those who lost it, principally taxpayers, but it is important there is accountability over SCF’s management and alleged mismanagement.
Of course it is up to the trial process to determine if any laws were broken, and by whom.
Related posts:
- The Hubbard charges
- Is it just bad book keeping or criminal behaviour?
- Imperator Fish on South Canterbury Finance
- SFO announces SCF now under investigation
December 7th, 2011 at 6:22 pm
Considering Hubbard is brown bread it all becomes a bit academic, doesn’t it?
(I wonder if Feeley nicked any bottles of shampoo from Hubbards fridge?)
Vote:December 7th, 2011 at 6:26 pm
JamesS: [Ahem...] According to the Herald, five people are facing 21 charges. I’m sure at least 4 of them will be alive….. 8)
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10771616
Vote:December 7th, 2011 at 6:32 pm
$1.7 Billion……. sheeee-yit, that’s a lot of money……
Vote:SFA chance of getting much of it back too, I’d say.
December 7th, 2011 at 6:46 pm
Actually, Hubbard CANNOT be involved. Anyway, why the CONTINUED whitch hunt against that man? The SFO would have had bugger-all chance of getting a serious coinviction against Hubbard since the charges were all technical and might be considered BS.
Vote:If the SCF (different from Hubbard though most folk dont see the distinction) charges are something more than that then that will be great.
But smashing people over the head for the sort of breeches that Parliament fixes for its own (Clark / Peters on election spending) is hardly cause for celebration .
The real issue is: will there be any recovery of our money? It is NOT Government money it is OUR money.
December 7th, 2011 at 6:48 pm
Seems the alleged skulduggery which is being investigated ,if discovered at the time ,perhaps SCF would not have qualified for the taxpayer guarantee.Thus saving the nation the total amount paid out.I heard on the Larry Williams show that it is the biggest fraud in NZ history if proven.Yet the NZ TV news channels appear to have ignored the latest charges coming out of the Serious Fraud Office.They seem more interested in a guy from Labour called Shearer who could be the next leader of the opposition.They did not mention he is an alleged millionare.Why should they,same goes for John Key ,yet they do, go figure.
Vote:December 7th, 2011 at 7:00 pm
Oh please! would everybody grow up for a moment? there is nothing wrong, it is just that after the SFO bloke was caught out stealing and running a kangaroo court he has to do something to keep his job so he invented this rubbish last night – probably whilst pissed.
He grabbed a handful of typists and cleaning ladies from South Canterbury Finance and charged them with nefarious activities, bandies about figures in the billions, gullible people swallow it whole and he keeps his job.
If you believe this rubbish then I have a bridge in London to sell you.
Vote:December 7th, 2011 at 7:06 pm
Accountability. Like most millionaires who make their money with finance and housing, they’ll hide their cash (overseas, in wife’s, kids’ and mother’s name) and declare themselves bankrupt. Only to start the whole thing over again after a nice holiday on the Greek Islands.
Vote:December 7th, 2011 at 7:13 pm
Why don’t we wait until the trial to declare people innocent or guilty? 1500 companies in 40 years is a lot in anyone’s book.
Vote:December 7th, 2011 at 7:34 pm
I wish Feely would actually get on and do his job and stop hunting headlines. Bollocks 80% of SCFs book was fraudulent it’s a ridiculous headline. Sure there are some questionable loans but making out its on Madoffs level is plain stupid headline hunting.
Vote:December 7th, 2011 at 7:34 pm
James,
Vote:I don,t think anyone is saying that there is nothing wrong with SCF.
SCF and Hubbard/Aorangi are not one and the same. Had he survived that accident, Hubbard may have had SCF charges laid against him. But charges do not amount to findings of guilt. We simply do NOT know.
In respect of those now charged, let us hope that they are real fraud charges and not also technical matters. Since the FMA is also involved technicalities may be involved. It may be that the publicity relates to matters that do not amount to fraud. We shall await details with interest.
December 7th, 2011 at 9:31 pm
I would suggest the trials should be removed to Auckland or Wellington, where we might get a fair jury.
If they proceed in Canterbury, the willful blindness of SCF supporters there is likely to result in one or more jurors not having an open mind when impaneled.
Vote:December 7th, 2011 at 9:37 pm
Oh right toad we move the trial up North. Why do that toad or do you think Canterbury justice is a farce?
Vote:December 7th, 2011 at 9:51 pm
toad – the problem with removing trials to the likes of Wellington is that the local population has the extra burden of supplying juries for out of town cases.
Vote:December 7th, 2011 at 10:04 pm
@dad4justice 9:37 pm
No, not generally. But given the highly publicised and well supported campaign in Canterbury to persuade the SFO and the Securities Commission to back off any investigation of SCF, I suspect it is highly unlikely that any jury selected in Canterbury would not have at least one juror with a pre-determined position.
Vote:December 7th, 2011 at 10:09 pm
For once I agree with Toad.
The trial cannot be held in Chch.
For some strange reason many in the south still think Hubbard was a saint when all the evidence points to him running a ponzi scheme that cost all tax payers a bloody fortune.
Vote:December 7th, 2011 at 10:09 pm
Oh come on toad, your opinion is worthless shit. You greens think natural justice comes in a commie can. Get a life as justice is blind you fool.
NB – Edit – Amanda told you about Graeme eh? Do observe you are going to learn something. Second time did you get the first one. email -cheers.
Vote:December 7th, 2011 at 11:30 pm
Clearly an indication as to how weak the Overseeing is in this country..
Off with their heads.. ( The Overseers that is ).
Vote:December 8th, 2011 at 8:20 am
At least Key paid tax on his earnings. Shearer made a fortune working for the UN and that’s all tax free. You didn’t think he did it for love, did you??
Vote:December 8th, 2011 at 8:23 am
Toad has a good point.
Conspiracy theories seem to be alive and well in South Canterbury regarding Mr Hubbard’s treatment, and to hold a trial there would probably be pointless if you were looking for an impartial jury. On the other hand, shifting it further north would feed the conspiracies further. Dunedin perhaps?
Vote:December 8th, 2011 at 8:26 am
Well except Hubbard isnt on trial
Vote:December 8th, 2011 at 8:46 am
Bet Goff is wishing he had their fund raising skilz now.
Vote:December 8th, 2011 at 9:47 am
This is now before the court so I imagine there will be a fairly detailed review by the courts on what happened and how it happened. At issue is the $1.5b paid by the Government under the deposit Guarantee scheme and whether there was falsification of information to ensure this payment was made.
Whether the Government will come under scrutiny in this process remains to be seen but if a fraud has been committed then the advice given to Bill English by his officials, and the Governments decision to proceed to cover the losses under the Guarantee will quite possibly come under the microscope.
Clearly the SFO considers that it has a case and they have put it before the court. It is an important case if for no other reason to ensure that there are processes in place to ensure that it does not happen again.
Vote:December 8th, 2011 at 9:52 am
beautox (206) Says:
December 8th, 2011 at 8:20 am
At least Key paid tax on his earnings. Shearer made a fortune working for the UN and that’s all tax free. You didn’t think he did it for love, did you??
How do you know that Key paid tax on his earnings or are you speculating? How do you know that Shearer made a fortune working for the UN or again is it speculation? Clearly you must have sources of information that us regular mortals are not privy to
Vote:December 8th, 2011 at 10:55 am
Mark – UN officials are well looked after in terms of accommodation and living standard, as well as salary. Whether or not Mr Shearer made a fortune working for them depends largely on your definition of ‘fortune’ – for most of us in NZ, this would be income well beyond our normal expectations.
Even in Rome, an easy and safe place to live, UNFAO officials have a standard of living extraordinary even by expatriot standards. I haven’t personally seen UN accommodation in countries other than in Italy, but assume they are of a similar standard. I think we’re safe in saying that Mr Shearer did well from his employment, which is probably fair enough. Where it becomes an issue is where his supporters imply that he didn’t.
Vote:December 8th, 2011 at 11:34 am
You would think the Hubbardite tools would welcome this news. Surely finding the “real” culprits will help in clearing Saint Allan’s name?
But no. They trot out the same unsubstantiated bullshit that this matter should just be dropped, that everyone should ignore it, and that the SFO is corruptly conducting a witch hunt.
Why?
Its probably because they think that Hubbard was actually guilty as charged, and dont want a trial to avoid having this confirmed to everyone else.
Vote:December 8th, 2011 at 11:39 am
Yep, the IRS in the US is one of the most forgiving tax departments in the world.
Vote:December 8th, 2011 at 12:50 pm
SFO can only prosecute FRAUD.
Vote:Not financial retribution – that will follow in the Civil Courts.
It is very possible that some well known names will be in this trial, but of course cannot be named until January in the Courts.
December 8th, 2011 at 11:50 pm
Hubbards managed funds don’t add up. Grant Thornton are going to the high Court to get a ruling on how to distribute the funds as if they dish out what actual assets exist some people will get 90% and others 20%, so the plan is to treat them as a pool.
Vote:By the way your XXX shares are now worth $$$ and you have $x cash on hand… titter, titter!