SFO delays Hubbard decision til 2011

SFO agrees to delay Aorangi decision until new year as Hubbard's (unpaid) lawyer prepares more information

10th Dec 10, 2:51pm by Gareth Vaughan

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Serious Fraud Office (SFO) chief executive and director Adam Feeley has confirmed the SFO has agreed to delay a decision on its investigation into Allan Hubbard's Aorangi Securities until 2011.

Feeley confirmed the delay, revealed in a brief press statement from Hubbard's lawyer and Russell McVeagh partner Mike Heron this afternoon.

In it Heron said the SFO had concluded its investigation into Aorangi Securities, but a decision hadn't yet been made.

"Mr Hubbard's lawyer has asked for more time to put further relevant information before the SFO," Heron's statement said.

"Some of that information is not able to be provided until after Christmas and accordingly Mr Hubbard has asked the SFO to delay any decision until the New Year, and the Director of the SFO has agreed to this. Mr Hubbard continues to deny any criminal wrongdoing."

Heron added that Hubbard's statutory managers, Grant Thornton, hadn't paid any of his defence costs to date and this was causing difficulties.

"The Statutory Management has restricted Mr Hubbard's access to his own funds since 20 June 2010, with the Statutory Managers providing him with a weekly allowance only."

Meanwhile, Grant Thornton released its own, even shorter statement, responding to Heron.

"The Statutory Managers have been liaising, and continue to liaise, with Mr Hubbard's personal legal advisers. The Statutory Managers put a proposal for immediate legal support to Russell McVeagh during November," Grant Thornton said.

"The Statutory Managers are confident that appropriate arrangements would be made for Mr Hubbard's personal legal representation should he face charges from the Serious Fraud Office."

Hubbard his wife Jean, Aorangi Securities and seven charitable trusts associated with the Hubbards were placed in government enforced statutory management on June 20. The SFO began investigating Aorangi, over potential breaches of the Crimes Act, after receiving information from the Registrar of Companies.

Subsequently the SFO broadened the investigation to include Hubbard Management Funds, after Grant Thornton's second report revealed it had frozen NZ$70 million in Hubbard Management Funds, a vehicle they weren't previously aware of, raised from an unknown number of investors.

There are 407 investors in Aorangi owed about NZ$98 million.

(Update adds comments from Grant Thornton).

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16 Comments

by Mark Daly | 10th Dec 10, 3:11pm 1291947106

This has to be the biggest stitch up of all time. Put into statutory management, money all taken away from you and they won't even pay for your defence against the charges.

There is something incredibily fishy going on here. Feeley saying for the last few weeks that the decision will be out by Christmas. Obviously someone has interfered and therefore he asks for more information knowing that Hubbard's team cannot reply quickly. When I was at IRD it was a trick that some used there - when you were coming up to an agreed deadline ask for more information and delay things and it also resets the deadline.

Clearly the powers that be don't want this to end anytime soon - can they stretch it out to the next election. The statutory managers will be in favour of that for sure!

by FCM | 10th Dec 10, 3:25pm 1291947920

umm I wonder just how much of the billion odd dollars the government will actually get back..by time take in lawyers fees etc etc..getting half the value back for the well over valued companies..

by Red Dog The Pi… | 12th Dec 10, 3:02pm 1292119371

This article is not about SCF.

It is about HFM and Aorangi.

You are off the topic.

by Nicholas Arrand | 10th Dec 10, 3:31pm 1291948260

It could be a simple as "Feeley doesn't want to upset and old man's Christmas", Mark.

by Mark Daly | 10th Dec 10, 3:36pm 1291948585

Doubt it.

by Mark Daly | 11th Dec 10, 9:03am 1292011387

I see a report in this morning's DomPost that the Statutory Managers say they will fund Hubbard's legal costs if he is charged by SFO.

Clearly he will be charged thereby delaying things till after the election.

by The Real The Man | 11th Dec 10, 9:22am 1292012540

ShonKey ran away overseas so that he wouldn't be around when his cronies got stuck into Hubbard.

Not that I'm saying there was anything wrong with getting stuck into Hubbard, but it was revoltingly gutless and cowardly of that sniveling little worm Key to time the 'intervention' so that he could flee the country before it happened.

John Key seemed okay in 2008 but he's proven himself to be just a bitchy and selfish little girl, and completely unreliable and untrustworthy.

The Governator accused John Kerry of being a girly man, but maybe it was his accent that confused everyone and he actually meant that John Key is the girly man. If so he was 100% correct.

by Red Dog The Pi… | 12th Dec 10, 3:12pm 1292119955

Key is Prime Minister and you are not.

So show the man some respect.

We all know that he is man who has made his coin sitting at a desk.

I'm not a National Party Voter.

But I am happy with how they are performing.

AH has no one to blame but himself.

He did not sell ACF when he should have.

He employed Y generation salespeople to operate it.

The sold money to sharks,clipped the ticket and the sharks ate the money so SCF could not get it back.

It is called lack of Governance.

He should have got out of SCF at age 70,and played around with his toys.

He has got plenty of them.

I have my SCF Debenture funds back.

I have invested them in Real Estate.

by Kunst | 12th Dec 10, 3:37pm 1292121423

Red Dog - why is John Key PM ?

by Gummy Bear Hero | 12th Dec 10, 7:00pm 1292133633

I reckon John Key is PM of NZ 'cos the crew at Merrill Lynch'd got fed up with that inane smirk and his lack of action . So they " arranged " for him to be de-moted to a far flung part of the world , where whatever he did was of no consequence to the rest of humanity ..........

And as we know , ML did so much better after JK's departure ......... Didn't they ?

by Number 6 | 12th Dec 10, 3:50pm 1292122257

Out of the SCF frying-pan and into the real estate fire, eh,....Once bitten, twice shy doesn't appear to be a lesson that The Red Dog has learned.

by Red Dog The Pi… | 12th Dec 10, 3:05pm 1292119505

Given that AH has undertaken to restore the position of the investors at HFM and Aorangi in due course,I do not have an issue with the statutory managers funding the legal costs.

by Red Dog The Pi… | 12th Dec 10, 5:34pm 1292128450

Because he has been appointed by the voting delegates of the National party as their leader .

by Red Dog The Pi… | 12th Dec 10, 5:37pm 1292128625

I never viewed SCF as a risky investment.

I was proved correct,as I received all my capital back.

Real Estate has been the only form of investment from which I have seen people make real money.

The secret is location,timing and gearing yourself at a level at which your bankers do not control you.

by Number 6 | 12th Dec 10, 5:54pm 1292129657

Your risk was mitigated by the Government Guarantee. Your unseen risk was real, as was the risk for Hanover investors You were lucky that the GG was in place; that's all. And, yes people have made 'real money' - (I'd actually dispute that much of it is real ,as it's mostly a price inflated asset that produces little). Go for it, with your property investment! But remember. You are going where the money has been already made, and providing those who went before you with their 'real' profit.

by Red Dog The Pi… | 12th Dec 10, 8:59pm 1292140770

SCF was always a different beast to the Cocktail set who operated Hanover.

There are wheels within wheels in this country.

I told people to get out of Bridgecorp long before it crashes and I told people to get out of Hanover long before it collapsed.

It was known in professional circles that the SCF books historically had not always been what they might seem,but the backing for SCF from the right circles was always there.

They got the GG when others would not have because of their lack of influence.

I was a longterm SCF investor,and did not elect to continue under the extended GG.

As for investment,the many unfortunates who were ensnared by the many dodgy financial planners,would have been far better off buying themselves the odd house or two.

And those who listened to Don Brash & Co and diversified into shares,would have been better off buying themselves a house or two.

Or have you not noticed how much of the western world are tenants.

Top marks to the Chinese guys who were recently in the media with their holdings of commercial property in Wellington...and a brothel or two for good cashflow.