FMA: Investors will be disappointed
FMA chief executive Sean Hughes acknowledges that investors will not be happy at the organisation's decision not to take action against four finance companies.
Monday, September 9th 2013, 11:30AM 4 Comments
FMA announced today it has finished its investigations into four of its remaining finance company cases but will not be taking enforcement action against Allied Nationwide, Equitable Mortgages, LDC Finance or Irongate Property.
It had looked at possible breaches of the Securities Act and identified some evidence of non-compliance. But, taking into account the prospect of success and potential defences, existing returns to investors and public interest considerations, it decided not to take action.
Allied Nationwide's directors were issued with a warning letter, telling them they likely breached the Securities Act and that they should have made better disclosure to investors about the risks associated with their investments.
FMA chief executive Sean Hughes said investors would be disappointed but factors including the best use of public resources had to be weighed up.
"It would not have been appropriate to take proceedings."
He said it was the FMA's expectation that the directors would disclose to the market the positions they held at the time of the collapse. "The directors of these failed finance companies have been reminded of their obligations to comply with all financial markets legislation and we will continue to monitor their conduct within our general surveillance activities."
Hughes said announcements would be made on the five outstanding investigations by the end of the year.
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Comments from our readers
It would also be safe to assume the prosecution piggy bank is running on empty and the defendants ain’t got any money for the victims’ settlement fund.
But what irks me the most, is the rat bags have got away with it. We now have a duty to make sure they don’t have a chance to do it again.
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This doesn't instill a lot of confidence in the process, when the villians are let off the hook because it's a bit too hard...
I would suggest that there is significant public interest in allowing this to run its course... just ask those who lost their money!