South Canterbury Finance Limited

[Beagle]

Don't be too harsh on our judges - the two (age 65 and 70) are going to find a year or so in jail at their ages and after the soft lives they have lived pretty tough.

Meanwhile, sounds like Allan Hubbard's greatest cheerleader and worshipper (before he fell from grace), Chris 'see my own rating system for finance companies but got them even more wrong' Lee, has turned really septic on his previous idol.

He is suggesting best course of action now is against Sandy Maier and Forsyth Barr :

"Another group who should not give up hope are those that want to see accountability for the blatantly poor management of South Canterbury Finance this year.

In September I recorded specific issues that simply must be examined by the NZX, the Securities Commission and perhaps the Commerce Commission.

Specifically the American Samford Maier Junior (“Sandy”), the Forsyth Barr chief executive Neil Paviour-Smith, and SCF’s directors must be asked to explain key concerns.

The biggest issue is why Maier told the market in May 2010 that SCF was breaking even, had no known need for future provisioning, was getting 40% renewal rates, had $240 million of nett shareholders funds, and had an encouraging future.

All of these statements, at the time he made them, and subsequently, were demonstrably inaccurate, in my opinion. I said so, at the time.

The effect of these statements on SCF’s preference shareholders may have been to encourage investors to hold on to the shares, or even buy more.

Nett shareholders funds of $240 million implied a nett asset backing per preference shares of nearly $2.00, in May. In September the nett backing was negative $3.00 at best. Between these two dates, not a word was said about collapsing asset values."

Sounds like a good idea which Enumerate may want to follow.

Meanwhile, not a whisper from our resident human rights champion about poor old Hotchin whose NZ assets and rights have been taken away - without notice!

We're definitly on the same page with the SCF matter and if I was stupid enough to have got caught with hundreds of thousands of SCF pref shares I'd be looking to sue, there's no question whatsoever. I really hope the Directors and Sandy Maier are sued or prosecuted, preferrably both, I think there's excellent grounds on both fronts.

It may well be tough on the five star finance directors but when you see the effect the finance companies fisacos have had first hand, up close and personal on people you know, and feel the cold knife of it on your own investment portfolio, two years 10 months or whatever part of that they actually serve, is pathetic, I simply have to call it as I see it. Perhaps its not really the fault of the Judiciary as the maximum penalty under the Securities Act for the crimes is 5 years imprisonment so until we get a revised Securities Act with real teeth, (FOR GOODNESS SAKE WHEN WILL THE POLITICIANS WAKE UP AND TAKE NOTICE), they have no option but to continue dispensing slaps on the back of the hand with wet bus tickets. Where's the deterrant ?

[minimoke]

I may have to put Enumerates suggested reading on the back burner this Christmas. Looks like the Receivers report on Southbury will be far more interesting. I guess at this time of year I prefer mysteries rather than novels.

It looks like the 30 June YE accounts are a huge mystery. Theres this "Unexplained Differences" line but the amount against that line isn't initially clear. That information is being "withheld". Spooky!

While NZ kids tuck into a good "Wheres Wally" book we can get stuck into "Wheres the Money" SCF has it. No - Southbury have - yes there it is, a whole $103.9m!. Hang on whats this other $84.7m. Oh blind path - thats just another amount Southbury debt owed to SCF. Doesn't that thing that looks like a helicopter look like the money or is it just a mirage?

As the plot thickens we find we can't find the money because the accounts are "Incomplete and Unreliable". Unreliable? Impossible!! The start of the yarn had us believing a clever accountant and skilled auditors had it all under control. Is it perhaps that theres a bit of skulldugery going on?

Wot? we might say. Thats a mystery. How can it be that assets and liabilities can't be quantified. There no doubt going to be lots of twists and turns.

I'm liking the Clockwork Orange theme - you know, where there is this language but it needs special interpretation. Like when in January 2010 they say "Southbury Corporation and its subsidiaries had consolidated total assets of approximately $2.8 billion and net assets of approximately $300 million on a pro forma basis as at 30 June 2009." what do they really mean. Or what did this mean on 20 August ""This will be of far more significance for all stakeholders and we would anticipate that Standard & Poor's will want to undertake a review of the Company's credit rating soon after."

And we even have double entendres with lines like ""Nothing has, or will change, to alter the protection that eligible investors enjoy under that {deposit guarantee} scheme,"

And its the sub plot that might be interesting - who is the mystery Dibby Dobber. Who are the secret governmental agents who conduct raids in the light of day, who are the power brokers getting govt to do things govt has never done before.

I can hardly wait!

[Beagle]

I may have to put Enumerates suggested reading on the back burner this Christmas. Looks like the Receivers report on Southbury will be far more interesting. I guess at this time of year I prefer mysteries rather than novels.

It looks like the 30 June YE accounts are a huge mystery. Theres this "Unexplained Differences" line but the amount against that line isn't initially clear. That information is being "withheld". Spooky!

While NZ kids tuck into a good "Wheres Wally" book we can get stuck into "Wheres the Money" SCF has it. No - Southbury have - yes there it is, a whole $103.9m!. Hang on whats this other $84.7m. Oh blind path - thats just another amount Southbury debt owed to SCF. Doesn't that thing that looks like a helicopter look like the money or is it just a mirage?

As the plot thickens we find we can't find the money because the accounts are "Incomplete and Unreliable". Unreliable? Impossible!! The start of the yarn had us believing a clever accountant and skilled auditors had it all under control. Is it perhaps that theres a bit of skulldugery going on?

Wot? we might say. Thats a mystery. How can it be that assets and liabilities can't be quantified. There no doubt going to be lots of twists and turns.

I'm liking the Clockwork Orange theme - you know, where there is this language but it needs special interpretation. Like when in January 2010 they say "Southbury Corporation and its subsidiaries had consolidated total assets of approximately $2.8 billion and net assets of approximately $300 million on a pro forma basis as at 30 June 2009." what do they really mean. Or what did this mean on 20 August ""This will be of far more significance for all stakeholders and we would anticipate that Standard & Poor's will want to undertake a review of the Company's credit rating soon after."

And we even have double entendres with lines like ""Nothing has, or will change, to alter the protection that eligible investors enjoy under that {deposit guarantee} scheme,"

And its the sub plot that might be interesting - who is the mystery Dibby Dobber. Who are the secret governmental agents who conduct raids in the light of day, who are the power brokers getting govt to do things govt has never done before.

I can hardly wait!

Couldn't agree more, who wants to read the recollections of a very sick old man still croaking on about all the good works he's done over the years ? Arn't there better things to do over the Christmas holidays surely !!

Too add to the mystery as the "plot" thickens, there's no point asking Alan, its become clear he lost it some time ago, everything's Kosher, YEAH RIGHT.

[winner69]

This is kosher ..... "I am a New Zealand hero, nobody in the history of New Zealand has done what I have done. I have turned down two knighthoods but it is just not in my nature to go around crowing about it."

http://www.stuff.co.nz/business/mone...anies#comments

[minimoke]

I'm wondering if SCF offices are being checked?
http://www.stuff.co.nz/national/4555...ll-dogs-Timaru

[winner69]

NBR reports Hubbard having a brain scan ... for the SFO .... kosher

How ridiculaous can this saga get

[sharer]

Thanks to Cunliffe in Parliament, & some good journalism from Fran & others, there are some interesting & very relevant disclosures in news items today re SCF, & multiple frustrated efforts by various parties to save (parts of) the business.
It seems Treasury officials were implacably determined that SCF Preference shareholders should not recover any of their capital.
Why?

[Enumerate]

National Securities and Corporate Compliance Unit manager John McPherson is the best person to ask this question.

[minimoke]

NBR reports Hubbard having a brain scan ... for the SFO .... kosher

How ridiculaous can this saga get

Alan and Jean spending $11,000 a day, seven days a week on legal fees? Its reported today that their legal bill to date is $2.5m. Clearly there is an appetite to spend money that isn't theirs - theres a continuing theme there.

[minimoke]

It seems Treasury officials were implacably determined that SCF Preference shareholders should not recover any of their capital.
Why?

As I recall it was flagged well before things turned to custard that Pref Shares were not covered by the Guarantee. Holders knew this and the risk of that was built into the return they bought into. If they didn't like it they could have looked at exiting.They can't have it both ways.

Of course this is at odd with depositors who could be offered ridiculous rates with the company knowing there was no risk because of the Guarantee. Immoral - probably. Worth further inquiry - probably not.