"...annual statements prepared by Hubbard and sent to investors have over stated the investors position by at least 25% ..." Isn't that a classic Ponzi scheme? It infers that existing invetors will be repaid their P&I from new investors?

Madoff?

Rally on main street Timaru this arvo?

See you there...

Guys?

Guys?

Hello?

Might I be the first to ask if Hubbard's cupboard was bare?

“The statements sent to the investors by Mr Hubbard for the year ended March 31 show a value for HMF of about NZ$82 million,” the statutory managers say.

“Shares and other investments in excess of NZ$13 million which do not exist have been allocated by Mr Hubbard to investors within the HMF portfolio.”

Correct me if I am wrong but isn't this plain and simple FRAUD?

Comes as no surprise does it?

Where are all the Hubbard supporters now?

Smacks of Ponzi?Madoff? You bet.

When will these finance companies finish their endless connivance?

Too many people ripped off, too much money taken out of our  financial system.

'ol Mr Hubbard ,   'ees all right , ''e will pay us back one day ...."

(Tui ad )

Haere Ra to your money O Aoranginvesta

HMF =  How Many Fools invest in f-f-f-f-f-f-f-f-f-farms  !

theyll be waiting til the cows come home for their money.

iMAGINE the b-b-b-b-b-b-bill from Mr Grant Thornton for sorting this mess out

Looks like Alan used one of those Wall St. pens for his mark-to-market calculations ~ A Magic Marker.

Any Hubbard supporters out there want to give their 2 cents in light of this new information?

I think a few too many south island folk  dangerously and deliberately blurred the lines between business & personal with SCF...

Hubbard Funds...

We specialise in wealth distributon

OK... so there are some more Farms about to come on the market... no big deal...

There are plenty of Foriegn Nationals out there with Deep Pockets.

I can't quite understand why the auditors aren't taken to task (court, in plain english) over such obvious and significant shortcomings in the way the accounts are documented and signed off!

If I told my accountant (who does not audit my business, he just prepares a set of accounts based on my bank statements and info from me) that he should put in some dreamed up figure as a 'cash at hand' item, he would tell me to find some other accountant. Because he opens himself up to prosecution and losing chartered accountant status! So, why does that not happen to accountants who prepare accounts, and more importantly AUDIT those finance companies?

Bernard, would that not call for some investigative report on how standards of chartered accountants are monitored, since they are appointed auditors to such entities and who should be relied upon to ensure accounts are actually kept properly and reported correctly?

Before we scapegoat finance companies we ought to look at the whole system that led to two square meters of books about "realestate riches" down at your local bookstore.

It could have been an employee of the auditors who blew the whistle?

NOT SURPRISED !!....Investore should be happy the shortfall is only around (at least?) 25%.

If all the finance companies still standing is given the same treatment, the same result will be announced !!

Janie Annear, where are you, or are you too busy trying to see through the egg on your face?

Hang on- there's a 'new investor' about to be announced?  That's why SCF share-trading has been suspended?

The question I have to ask is when is the SFO going to go after the Bad boys like Hotchins and his play girl wife and Eric Watson etc or do they prefer to start with the weaker targets first. Maybe they are scared of their lawyers or maybe they have hit men.

And when are they going to give the guilty some real punishment when proven guilty.

Our country's new slogan: Rob Peter to pay Paul.

Imagine what would have happened if the SFO had put many of these finance companies into stat. man. Guess there are a lot of powerful influential people who have invested in Hubbards funds to get the regulators to actually act vs the other finance companies. Guess it is all about who you know.

Winston Peters brought the WineBox inquiry and has been hounded/ridiculed for it ever since.Little crooks go to jail in NZ. The big crooks don't.

"The Lord is my shepherd and I want all he sheep" - Saint Alan of  the 'Most Bountiful Tabernacle of the Wholly Deceiving Children of Jesus'.

Todays Hymn:

'Oh Come and Gone All Ye Faithful'

The only difference between a young crook and an old crook is the number of hot dinners they've eaten.

Ronald Biggs.

It must be nice to play santa claus with other peoples money.

I know SCF is supposedly "not involved" but that seems a little incredulous.

I read that the government guarantee would not apply if fraud was found to have taken place...but the government seems to be at pains to stress that SCF is seperate...why??

As a taxpayer I don't want to bail out SCF and pay 8% interest to all of it's investors!!

Keep your money in a shoe box

I also wonder why SCF is not included in the stat management. That should be checked for fraud and then US poor taxpayers may not have to pay out! Any recent depositors greedy to get the 8%. If should go to the wall and other businesses will get the chance to come up out of the ashes.

Where are all the Hubbard supporters now? Talk about the blind leading the blind. A ponzi scheme all right. Hubbard borrowing and putting into his own interests and what a web that seems to be.

Can someone please tell me whether Hubbard has broken any laws? Will there be charges pending?

To make a media release if not backed up by charges is pretty poor form. Sure, you should inform the investors directly, but to shame the man publicly is disgraceful.

V,

What I don't understand in this saga is the following:

Wasn't Aorangi a private investment vehicle, where most of the investors knew AH personally? If so then why can't the assets be written down and the investors take their haircut? After all they probably earned good returns in the good times and should take the losses when they occur now that asset prices and earnings are under pressure.

As far as SCF goes, whilst they seem to have some dubious quality loans on their books, the other issues surrounding AH haven't helped investor sentiment. Would you put money into SCF under such circumstances?

More broadly, how much of this is simply related to the world of fractional-reserve banking that we live in that results in a debt pyramid?

For example, if say tomorrow the government announced that there was going to be an SFO investigation into ANZ bank and aspects of it were to be put under statutory management, this would cause an instant run. Without a government backstop this would make the bank insolvent instantly, given that there would be no way the bank could call in all it's NZ residental mortgage loans overnight.

Good post V.

A couple of things I don't understand - Where is the tax department in all this - has tax been paid correctly?  And the Hubbard Fund that the SFO did not know about? How can that be?

The fact that Hubbard has been so generous all round? Loans forgiven and interest free loans and the community gifts - now we will find out who has actually paid for all this. And his humble living conditions - his SFC cronies live very large - hope as taxpayers we are not going to have to subsidise all that.

Plenty of hysteria on this site - as usual.

A couple of things:

This isn't a ponzi scheme. 26 large dairy farms underpin this company. Dairy is NZ's only sure thing after tourism.

Valuations are subjective. I could get a valuer to value the farms 25% above Hubbards valuation.

The missing 'cash' is simply old school classification of liquid assets.

The stat managers opinion re accounting records and an 'alarming gap between income and debt' are irrelevant and alarmist.

The question is, is the fund solvent? Will it remain solvent? Neither of these questions have been addressed by the stat managers. Why is that?

There was a man called HUBBARB and when they open the CUPBOARD  they found the same as they found with all the other 96 Broke Ponzie Finance Schemes A LEMON.....?

Poor old AL misjudged the market and lost the lot.....anyway he was also probally drawning down the pension as well.................;)

I find it curious that of the 157 comments on this post, the large majority are juvenile sarcastic mud slinging comments totally lacking in any intelligence whatsoever.

I'm wondering who all you people are who are gleefully being vultures and why are you all so self righteous and smug and taking such pleasure in seeing the government publicly try and make an 82 year old fall.  

I'm interested in a comment that PWC may have also audited HMF as PWC are the usual statutory managers' appointed by the government. Grant Thornton have never done it before so they are novice statutory managers capable of error.

It must also be remembered that Madoff didn't make bad investments, or make mathematical mistakes. He admitted he had never invested any money in anything in his entire life. He owned nothing but his own personal private fortune of homes all over the world and cars and a fleet of yachts. He had no financial training. He dropped out of law school. He didn't own any shares or companies. Madoff was a thief.

Mr Hubbard is a qualified chartered accountant who has maybe made a few mistakes or misguided investments but he did make investments. He does buy shares and investments. There is no way as a shareholder of SCF that he could have put Simon Botherway's brother into receivership if he didn't have the paperwork to prove that Simon Botherway's brother owed SCF just a few million dollars.

It is obvious at 82 he may be getting a bit past it and probably he would be a happy man today if he had retired some time in the last 17 years since he reached the age of 65, the year the Companies Act of 1993 came into force.

I take no pleasure in seeing an 82 year old man take a fall, however, if you are going to be a philanthrophist, do it with your own money. Not investors in your company!!