KIWI FINANCE COMPANY OF ALAN HUBBARD the government hve paid out $1.7 billion 31st AUGUST 2010

KIWI FINANCE COMPANY SOUTH CANTERBURY FINANCE

South Canterbury Finance: of Alan Hubbard. This finance and development company is now inreceivership & Alan Hubbard a man who helped many businesses and people came under statutory management then went into receivership to the National Govt. The finance company had its main loans in the troubled; property development & farming dairy sector & just like Hanover fell down like many who relied on the loans & developments. Before statutory mmanagement was announced it would not give investors - or anyone - detailed information about the state of the property developments it had invested in? They, the Timaru-originated business launched its prospectus for a $1.25 billion recapitalisation but the govt had to step in. Allan Hubbard now in his prime in his 80's & really should be enjoying retirement but kept up to $200 million of South Canterbury Finance's loans under his own personal control is now broke. His business under statutory management along with seven charitable trusts and Aorangi Securities, are also being investigated by the Serious Fraud Office. But the news is Hubbard accepted on-call deposits and invested that cash mainly in long-term loans and investments, with a lot of this money going into about 25 dairy farms; unviable businesses etc. That created an “alarming gap” between the company’s loan income and repayments to investors as the dairy industry slowed and not a good idea to do.

Now his finance company is in the cactus owing shareholders around $1.7billion + dollars but the Government has paid investors covered by its retail deposit guarantee, ( it was dopey Labour Government that brought the deposit guarantee in 2008?? and note they say nothing??but we must say many other companies folded as well and maybe NZ would have collapsed if they hadn't intervened. Perhaps the Labour Government should have checked this earlier on as finance companies went on a rampage in the property development game hyped up by our media & sucked many householders in with sales pitches too good to refuse.

Being government guaranteed the tax payer will now pay this & theres no way out as now the Government will take over South Canterbury Finance. But what happens is speculators would have banked on the collapse at a discounted rate thus having their investments safe as houses knowing full well the company was in difficulties as they new SCF extended the cover in April 2010. So the writing was on the wall and the tell tale sign of wow lets buy in was overwhelming???. South Canterbury was now inundated in 2009 by investors to its prospectus for securities and deposits offering yields of up to 8.5% while Westpac could only match 4% and not be govt guarateed? Thus with $$$ rolling in it was only a matter of time for those businesses, dairy farms etc & those property companies who sort loans over properties not yet built to dive in for an advance. And who cares if the rates of repayment would now be 10%+. SCF would have been shell struck with so much money they invested in not so good assets. For the borrowers It was money they couldn't get from the banks & SCF responded---- that would lead to their demise.

But will the SCF Company that the government will absorb now make a profit?? --not likely as the good business investments weren't associated with South Canterbury Finance making this not such a good business and will take years to absorb the payout situation. They will not get the full amount back with a shortfall of around $700m. Paying out all depositors avoiding continuing payments of interest at the high rates SCF offered – up to 8.5 per cent & the government are in the position of sitting on their new assets and waiting for a buyer? The Hubbards will lose all!

SOUTH CANTERBURY FAILED FINANCE COMPANIES

Alan Hubbard and his wife Jean were singled out after a complaint by failed Hospitality Businessman James Botherway and led the charge against the couple when this guy went bust?? Jonathan Botherway's hospitality empire collapsed in July 2009 after SCF, then owed $7.8 million, put it in receivership. Commission Chairwoman Jane Diplock did not believe there was a conflict on interest??????????

A supporter of Mr Hubbard, Paul Carruthers, called for an investigation in a conflict of interest involving Securities Commission member Simon Botherway the brother of James??? Ruth Dyson of the Labour Party got involved but its now too late. The Hubbards helped many with jobs in Canterbury and many businesses. They have worked hard and do not have the fancy cars, boats etc that those other ripoffs like the directors of Hanover Eric Watson and his mate Hotchin who still have peoples money and there flash homes and cars. Wheres the justice in all this NZ? No its never looked at like this once someone defaults they then backtrack and want nothing to do with it. However the facts remain this company as with many are now in trouble and one of the biggest since AirNZ went belly up and needed Government bail out funds of $1.7 billion--the investors are very lucky.

In Nov 2010 a director of Ashburton-based Woodnorth Myers & CoByron Pearson was fined $38,000 over his failure to identify some of the lender’s position in the firm’s report for the six months ended December 31, 2008. He lacked the required depth of experience and expertise of auditing. The New Zealand Institute of Chartered Accountants disciplinary tribunal imposed the fine.

THOSE NZ FINANCE COMPANIES BEING INVESTIGATED

BY THE SFO ( Serious Fraud Office )

Blue Chip - alleged $200m+ investment fraud
Nathans Finance - alleged $50m+ investment fraud
Fivestar - alleged investment fraud
Lane Walker Rudkin - alleged $120m+ funding fraud
Capital + Merchant - alleged $165m+ investment fraud
ACC - alleged corruption or fraudulent payments/investments
Aorangi Securities & Allan Hubbard - alleged $1.4billion in the red

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