When the Government assumed control of Allan Hubbard’s companies, they were attacked by many in South Canterbury, and beyond. Hubbard was a saint who could do no wrong, and Simon Power was savaged for agreeing to statutory management.
Now Hubbard was a well intentioned individual, but as the Herald reports, his financial management was deficient in recent years:
Allan Hubbard, the late boss of South Canterbury Finance, which collapsed and required a $1.6 billion government bailout, “had little interest” in meeting accounting or legal requirements, and three of his most trusted colleagues went along with the massive fraud, a court has been told today. …
Long-time SCF chairman, Timaru financier Mr Hubbard, who died in a September 2011 car crash, aged 83, ignored various accounting and legal regulations that he was bound to adhere to, the court was told.
One witness described Mr Hubbard’s attitude as being, “Trust me, I know what I am doing”.
“The evidence has been that he had a disdain for disclosing related party transactions, a peculiar view of what constituted one, a penchant for swapping cheques to cleanse the accounts … and took assets off the balance sheet if they were impaired,” Crown lawyer Colin Carruthers QC said. …
The Crown says that on July 25, 2007, the defendants prepared a letter to Mr Hubbard expressing their concerns with the business practices.
“That is an extraordinary document, setting out a long list of issues directly relevant to these charges, from related party advances, the single entity exposure limit, advances being made without security, loan and drawdown authorisation, and so on,” Mr Carruthers said.
But despite the concerns, nothing changed, Mr Carruthers said.
A decision in the trial is due in October.
Tags: Allan Hubbard, South Canterbury Finance