finPOWER Newsletter 27 Aug 2009
There have been a couple of very interesting articles in the Press recently relating to finance companies. We thought you might like to have a read ...
The inquiry into finance company failures by Parliament's commerce select committee is woolly in its thinking and populist while missing areas of significance.
This is according to a report by law firm Chapman Tripp, which pulls the committee up for not investigating why New Zealand regulators are less pro-active than Australian regulators.
"Surely it is worth asking why the Australian Securities and Investment Commission stopped Bridgecorp from seeking deposits, when no New Zealand regulatory agency did the same," Chapman Tripp said in a report entitled Once More into the Breach.
Bridgecorp collapsed in July 2007 owing $459 million to 14,360 secured debenture holders.
Parliament's commerce select committee chairwoman Lianne Dalziel announced the inquiry this month and said it would be looking at gaps in the system. Read More
The Government is introducing measures to ensure trustees are qualified to do the job and have the right systems to protect investors, after a string of finance company failures.
Other changes announced by Commerce Minister Simon Power in a speech in Wellington today were around improving transparency when finance companies use moratoria - an alternative to receivership - and for disclosure information around investments.
Power said the Government was bringing in a new regime for corporate trustees and statutory supervisors, who supervise debt issuers and some collective investment schemes. Read More