South Canterbury Finance Limited

[macduffy]

The government guarantee engineered a vast flood of "hot money" into SCF due to the fact that the deposits were government guaranteed.

Clearly, SCF was not in a position to rationally allocate all this money. Given, at the the time, SCF was held in high regard ... this money kept flowing

I can't buy that!

just because money carried the govt guarantee is no reason to keep on accepting it. The sensible course was surely to close the issue and withdraw the prospectus before the point was reached when money couldn't be "rationally allocated".

[Enumerate]

just because money carried the govt guarantee is no reason to keep on accepting it. The sensible course was surely to close the issue and withdraw the prospectus before the point was reached when money couldn't be "rationally allocated".

At the risk of labouring the point ... the reason why I am not saying things were rosy in 2008 was the fact that SCF were clearly not able to cope with the flood of money that came their way.

They should have borrowed long, to forestall a credit crunch due to short loan liquidity issues. They should not have borrowed as much - just to reset equity as a percentage of debtor assets at the high end of the scale. They did neither.

[Enumerate]

Lets not forget the Deposit guarantee scheme was an "opt in" scheme.

Are you seriously proposing that once the scheme was enacted that there was any option to "opt out"? Failure to "opt in" would have been commercial suicide.

Its debatable if SCF was held in high regard.

Chris Lee, circa 2008, would beg to differ.

Mini, you keep addressing your "straw man" point that SCF will fine and dandy in 2008. No one is arguing this ... just you, in reverse ...

[minimoke]

They should have borrowed long,

They should have - but no one would lend to them.

[Balance]

Chris Lee, circa 2008, would beg to differ.

.

And Chris Lee also thought that Strategic, St Laurence and Provincial were all fine as well.

In actual fact, Chris Lee thought that Allan Hubbard walked on water. Needless to say, not any more.

[fungus pudding]

In actual fact, Chris Lee thought that Allan Hubbard walked on water. Needless to say, not any more.

I think Mr. Hubbard himself thought the very same thing.

[Balance]

I think Mr. Hubbard himself thought the very same thing.

Notice how Chris Lee has taken all of his pre 2010 articles out of archives? Also, all the wonderful articles he used to do on rating the finance companies etc.

Strange behavior that.

PS. Forsyth Barr used to think the sun shone out of Allan Hubbard's nostrils?

[Beagle]

[QUOTE PS. Forsyth Barr used to think the sun shone out of Allan Hubbard's nostrils?

That's a reputation that was already in tatters before the SCF fiasco. Credit Sails, Feltex e.t.c. Forbar's list of winners just goes on and on.
Wonder if they'll get named in any forthcoming legal action.

[minimoke]

Counsel for "Kosher as" honest AH may be looking at Nathans Finance Directors convictions with interest. Despite acting honestly they distributed misleading information which conveyed a false impression. We are still waiting for the SFO's view on SCF. John Hotchin pleaded guilty and got a bit of Home D. These guys couldn't see the error of their ways so will be interesting to see what their sentence is. It might give AH a sense on how to plead for his current charges. I'd be surprised if the collapse of NZ's largest finance Co could be let pass by without some charges being laid.

[Beagle]

Counsel for "Kosher as" honest AH may be looking at Nathans Finance Directors convictions with interest. Despite acting honestly they distributed misleading information which conveyed a false impression. We are still waiting for the SFO's view on SCF. John Hotchin pleaded guilty and got a bit of Home D. These guys couldn't see the error of their ways so will be interesting to see what their sentence is. It might give AH a sense on how to plead for his current charges. I'd be surprised if the collapse of NZ's largest finance Co could be let pass by without some charges being laid.

The real problem my friend is that maximum penalties under the Secutities Act are totally pathetic, $300,000 or 5 years imprisonment and of course nobody gets anywhere near the max.
Go into your local bank with a gun and rob them of $1,000, the tellers will all suffer terrible trauma for sure and you'll probably get 7-10 years if you get caught.
On the other hand, if he's at the very least found to be culpable for the loss of $1 billion plus, amoung other things and he'll probably get Home D. Worse still the other directos of other finance companies who are confirmed criminals and who have been sentenced to date have received absolutly pathetic sentences considering the tens of thousands of people's lives that have been incredibly seriously affected.

N.Z. Securities Laws are very, very seriously flawed. If the Govt doesn't write legislation that really allows the judges to bite hard on these bastards how can they ? Until we get really meaningful deterrant sentences and judges that will impose the maximum where the heck is the deterrant to committ serious white colour crime ? At present it simply doesn't exist. Many finance company directors are laughing all the way to their family trust private bank fund in Switzerland and with the Swiss currency going through the roof, they're laughing even harder.