Serious Fraud Office estimates cost of its Hanover investigation at NZ$1.1 mln including fees for external advisors

Serious Fraud Office estimates cost of its Hanover investigation at NZ$1.1 mln including fees for external advisors

The Serious Fraud Office says its probe into failed property lender Hanover Finance, which resulted in no charges being laid, cost NZ$1.1 million.

The figure includes an estimate of the cost of SFO staff time spent on the investigation, and the cost of outside contractors, expert advisors, and lawyers.

"The investigation comprised around 12,700 hours of work by SFO staff. SFO does not allocate its internal salary or overhead costs on a case by case basis, but the estimated cost of 12,700 hours’ work is approximately $600,000," the SFO's acting CEO Simon McArley said in a statement.

"SFO was assisted in that work by external contractors supplementing SFO’s resources, expert advisors peer-reviewing and supplementing SFO’s expertise, and legal advisors from the SFO Prosecution Panel. Total external costs incurred were $505,111.40. This is consistent with external costs incurred in SFO’s other flagship investigations such as Capital and Merchant Finance ($295,870.55) and South Canterbury Finance ($493,720.53 to date)," McArley added.

He said it was essential for the SFO to be able make the commitment to this scale of investigation, so  a "credible deterrent" to offending is maintained.

 

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He said it was essential for the SFO to be able make the commitment to this scale of investigation, so  a "credible deterrent" to offending is maintained.
 
A deterent that seemed missing in the ethos underlying some of GCSB's activities - no penalties imposed there just a law change to make it OK - I suppose the citizen's won't get off so lightly - we are forever paying for failure to achieve.

1 million is cheap. It is also quite old news, as I am sure this figure was discussed weeks ago. Look at how much receivers charge compared to the SFO. Surely there is a reason why the hourly rates are so much different?
But I am sure that many investors would have prefered the cash. I mean if an investor still has shares that were originally worth say 40k when allied took over, they wouldn't even be worth the brokerage now.
 

A: Receivers are a law unto themselves...
Unless they are your receivers, have nothing to do with them/cut losses and move on...
 

Shows more short comings of securities legislation or otherwise. We think well done for taking a look. Better they than otherwise having to fall back on commercial litigation funders...

The rules are not the rules, just what we make them.
For example not until mid 80's was insider trading made illegal in Hong Kong.

Look at difference in listing rules between nzx and asx. Or between company material lodged on unlisted and that needed on nzx...

Some investigations take many years and do show results - $616m in this case:
http://www.vanityfair.com/business/2013/06/steve-cohen-insider-trading-case
In mid-March, after years of scoffing at every suggestion any of its traders might have done something untoward, SAC agreed to pay, without admitting guilt, the largest fine in the history of the Securities and Exchange Commission, a stunning $616 million, to settle charges of insider trading in only two trades. Some on Wall Street called it a victory for Cohen, who paid a pittance—for him—to make a messy situation go away. Others were not so sanguine, observing—correctly—that blood was finally in the water, that an S.E.C. fine did nothing to curtail the ongoing criminal investigation, which has already led to guilty pleas from and convictions of at least five onetime SAC employees.
 
The point of note is an investigation before a target collapse and after a collapse. i.e. with money and with money gone/locked away..