MR No. 2014 – 046
17 December 2014
The Financial Markets Authority (FMA) has closed its inquiries into potential civil claims relating to South Canterbury Finance Limited (SCF). After careful consideration the FMA has decided not to take any further action.
In making its decision, the FMA took into account that Crown Asset Management Limited (CAML) had taken civil proceedings against the directors of SCF, for failing to comply with their duties as directors and that a large number of investors have received payment under the Crown Retail Deposit Guarantee Scheme.
The FMA’s Director of Enforcement, Belinda Moffat, says the FMA conducted thorough inquiries into several aspects of SCF. These included whether SCF had met its continuous disclosure obligations, and the respective roles of the trustee and the auditor. The FMA has not found sufficient evidence that would justify the significant additional costs of taking further proceedings.
“Given CAML’s civil case and the criminal case that has recently been before the courts, the FMA doesn’t believe further proceedings are appropriate,” Ms Moffat said.
Ms Moffat said further recoveries for investors, or the taxpayer, were unlikely from the FMA proceedings.
“The FMA has made the decision to close these inquiries after very careful consideration of our responsibility to act in the best interests of the public. This decision does not diminish in any way the losses suffered by investors, taxpayers or preference shareholders, many of whom will continue to feel the ramifications of the collapse of SCF for years to come.”
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