RAM investor must return fictitious profit

A Ross Asset Management investor has been ordered to pay liquidators $454,000.

Tuesday, June 23rd 2015, 2:04PM

The test case taken against barrister Hamish McIntosh is part of an attempt to claw back $3.8 million from investors.

Liquidators had been seeking $954,000 from McIntosh, who previously had name suppression.

Justice Alan McKenzie ordered him to pay $454,000 – the “fictitious profit” he received from his $500,000 investment. He does not have to repay the initial investment.

The liquidators, John Fisk and David Bridgman from PwC, say they intend to proceed with remaining two cases against investors. They are also looking at other investors who received payments from Ross.

The withdrawals before Ross’ collapse in 2012, particularly those in 2011, are considered to be voidable under the Companies Act. A small number of investors received significant returns from Ross, while most lost money. It has been suggested that there could be $20 million to $25 million clawed back from investors who received payouts in the two years before the scheme was uncovered.

In that period, it is believed that 200 investors made money and 600 lost.

Ross is now serving a 10-year, 10-month jail sentence.

The money clawed back will improve the return of the burned investors, who lost about $100 million through Ross Asset Management.

Bruce Tichbon, representing investors, said it was a gain in principle for those who lost money but it had taken far too long to get to court.

"Having to wait so long for such small progress is debilitating for the mostly elderly investors whose money was stolen. The amount recovered in this first test case is less than 0.5% of the money that was stolen by Ross from investors. The objective must be to recover 100% of the money Ross stole, about $115 million in all. As yet we have no idea yet where this first case will lead. It has to be established whether this first case can possibly lead to recovery of all the stolen money, or whether it is effectively a ‘one off’ and the prospects with the other cases are materially different."

Tags: Ross Asset Management