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Australian-backed class action over finance company collapses gathers 2,200 claimants, including family trusts and others who lost millions

Australian-backed class action over finance company collapses gathers 2,200 claimants, including family trusts and others who lost millions

A class action law suit to recover compensation for investors in New Zealand finance companies has received more than 2,200 claims in the six weeks since it was launched, law firm Turner Hopkins has announced.

The class action backed by Australian heavweight law firm Slater and Gordon is targeting the professional services firms tasked with oversight of finance companies who have lost billions of dollars in St Laurence, Hanover Finance, Capital + Merchant and MFS Pacific. Those firms targeted include trustees. 

Turner Hopkins Partner Andrew Hooker said expressions of interest from around 940 individual claimants had been received.

“The volume and the nature of claims that we received has been significant. We have had an extremely positive response,” Hooker said.

“Mum and dad investors and family trusts make up a considerable portion of the claims so far, but we have also seen interest from companies and institutional investors in a number of countries," Hooker said.

Hooker said more than 30 financial companies were named in the claims received so far. The amounts lost varied, but some investors had registered losses in the vicinity of NZ$1 million. See our DeepFreeze list of which companies collapsed and how much was lost.

“We are at a preliminary stage in the process, but currently it looks like the majority of investors lost most of their original investment – including investors from those firms that have already been through receivership or liquidation,” Hooker said.

The majority of investors were from Australia and New Zealand, but claims had also been received from European, Asian and North American investors, he said.

See Amanda Morrall's March 23 article that broke the news of the lawsuit.

“We continue to seek interest from investors who sustained losses following the collapses that took place within the New Zealand financial sector between 2006 and 2009.”

Slater and Gordon is helping Turner Hopkins to progress potential claims against the trustees of the failed companies. 

See Gareth Vaughan's article on Perpetual Trust's lack of concern over any action.

Australia's biggest class action law firm settled last month with Sandhurst Trustees, the corporate trustees responsible for monitoring collapsed Australian financial company Fincorp.

Turner Hopkins said expressions of interest were still open here.

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2 Comments

Hi Bernard,  do you know if investors in Credit Sails, sold through Forsyth Barr, are eligible

in this class action? Or is it just NZ finance companies? We lost 100% of our original investment in Credit Sails after F.B. sold it as a safe fixed income investment for a 100% fixed income portfolio. Cheers, mgdwalker

2200. Hmmm

Pass the hat around and get $1000 of each. A South African friend advises that it would cost about $5K to deal appropriately with each debtor, that would be more than enough to cover all the directors involved and I bet you wouldn't even get halfway down the list before the rest paid up:-P

I wish them all the best regardless.