Archive | Viaduct Capital

FMA files civil claim against Prince as Viaduct trustee

The Financial Markets Authority said yesterday it had filed civil proceedings against Prince & Partners Trustee Co Ltd as trustee for collapsed finance company Viaduct Capital Ltd.

Viaduct & related company Mutual Finance Ltd went into receivership in 2010, Viaduct owing 110 deposit $7.8 million and Mutual owing 450 investors an estimated $17 million $9.3 million. The authority alleges Prince breached the obligations it owed Viaduct investors and Treasury under the retail deposit Crown guarantee.

It’s the first claim the FMA has filed against a trustee. The authority brought separate criminal charges in March against 5 directors or former directors of Viaduct & Mutual Finance Ltd, and another person who has sought name suppression.That action is still before the High Court.

One of those charged, former Viaduct director Nic Wevers, died in March and the charges against him were withdrawn. The others charged are Paul Bublitz, Bruce McKay, Richard Blackwood, Lance Morrison & the unnamed person. Mr Bublitz, Mr McKay & Mr Blackwood were directors of both companies and Mr Morrison of Mutual.

Financial Markets Authority enforcement director Belinda Moffat said yesterday section 34 of the Financial Markets Authority Act enabled the FMA to stand in the shoes of another, and exercise that person’s right to take action against an individual or company who is or has been in the financial markets industry.

Exercising the right of action of Viaduct investors & Treasury (which holds the rights of investors paid out under the Crown guarantee), the authority alleges Prince failed to fulfil its obligations to protect the interests of investors in Viaduct, and that this conduct resulted in loss to individual investors and to Treasury under the Crown guarantee, to which Viaduct was a party.

Attribution: FMA release.

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Propbd on Q W20Aug14 – 4 sell at City Sales, both units passed in at Bayleys, strong yields for NZ Post buildings, Connaught repair job popular, Viaduct Capital trustee faces claim

4 units sell under hammer at City Sales
Both apartments passed in at Bayleys
2 NZ Post buildings sell at auction
Traders swoop on damaged Connaught unit
FMA files civil claim against Prince as Viaduct trustee

5.15pm:
4 units sell under hammer at City Sales

3 city apartments and a leasehold Parnell townhouse sold under the hammer at City Sales’ auction today. Auction results:

The Quadrant, 10 Waterloo Quadrant, unit 1223, sold for $190,000, sales agent Maryanne Wong
Longview Apartments, 6 Whitaker Place, unit 4B, sold for $393,000, Lucy Piatov
George Court, 238 Karangahape Rd, unit 1B, sold for $535,000, Iona Rodrigues
Eclipse Apartments, 156 Vincent St, unit 5B, passed in at vendor bid of $340,000, David Hamlyn
Q-Central, 34 Liverpool St, unit 3B, leasehold, passed in at $110,000, Gabrielle Hoffmann
Parnell Terraces, 44F Ngaoho Place, leasehold townhouse with maintenance & repairs pending, sold for $85,000 on as is where is basis, David Hamlyn

Both apartments passed in at Bayleys

2 apartments up for sale at Bayleys’ residential auction today were both passed in. Auction results:

Whitcoulls Building, 6 Victoria St East, unit 6J, passed in at $375,000, sales agent David Anderson
Winsun Heights, 113 Vincent St, unit 1A, passed in at $135,000, Andrew Bond

2 NZ Post buildings sell at auction

2 buildings owned by NZ Post were sold under the hammer at Barfoot & Thompson’s auction today. Auction results:

Birkenhead, 22 Mokoia Rd,sold for $1.875 million at a 5.16% yield, sales agents Cam Paterson & Grant Magill
Avondale, 1990 Great North Rd,sold for $1.9 million at a 6.15%, Cam Paterson & Dave Palmer

Traders swoop on damaged Connaught unit

An apartment in the Connaught – much the worse for wear in an otherwise highly rated building – attracted plenty of traders at Crockers’ auction yesterday and was sold under the hammer. The other apartment on the list, in the Grand Chancellor, was passed in. Auction results:

Grand Chancellor, 1 Hobson St, unit 707,passed in at $725,000, Zoran Farac & Josh Muriwai
Connaught, 14 Waterloo Quadrant, unit 4E, sold for $223,000, Liz McCarthy

FMA files civil claim against Prince as Viaduct trustee

The Financial Markets Authority said today it had filed civil proceedings against Prince & Partners Trustee Co Ltd as trustee for collapsed finance company Viaduct Capital Ltd.

Viaduct collapsed in 2009. The authority alleges Prince breached the obligations it owed Viaduct investors and Treasury under the retail deposit Crown guarantee.

It’s the first claim the FMA has filed against a trustee. The authority has brought separate criminal charges against individuals associated with Viaduct which are still before the High Court.

Attribution: Auctions, FMA release.

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Wevers dies as FMA files Viaduct & Mutual Finance charges

Nearly 3 years after the Serious Fraud Office abandoned its investigation of Viaduct Capital Ltd & Mutual Finance Ltd (now Ex-MFL Ltd), the Financial Markets Authority has filed criminal charges against 5 directors or former directors of the 2 companies and another person who has sought name suppression.

One of those charged, former Viaduct director Nic Wevers, died on Wednesday aged 59. The Financial Markets Authority said on Friday it would withdraw the charges against Mr Wevers following his death. A service for him will be held at All Saints Chapel, Purewa, on Tuesday at 1.30pm.

The authority filed charges under the Crimes Act & Companies Act against Mr Wevers, Paul Bublitz, Bruce McKay, Richard Blackwood, Lance Morrison & the unnamed person. Mr Bublitz, Mr McKay & Mr Blackwood were directors of both companies and Mr Morrison of Mutual.

Both companies went into receivership in 2010, Viaduct owing 110 deposit $7.8 million and Mutual owing 450 investors an estimated $17 million $9.3 million.

The charges allege theft in a special relationship, laid under section 220 of the Crimes Act and carrying a maximum sentence of 7 years in jail, and making false statements in a prospectus, laid under section 242 of the Crimes Act and carrying a maximum 10-year jail sentence. The authority has also filed charges under section 377 of the Companies Act relating only to Viaduct, alleging false statements made to Viaduct’s trustee, which carry a maximum sentence of 5 years’ jail or a $200,000 fine.

The defendants’ first court appearance has been scheduled for the Auckland District Court on Wednesday 7 May.

The Serious Fraud Office began investigating Mutual Finance in December 2010 when the company’s receiver, the Ministry of Economic Development & the Securities Commission passed information on, but closed the investigation in June 2011, saying the allegations didn’t currently identify sufficient evidence of fraud. However, the office’s chief executive at the time, Adam Feeley, said the 2 companies’ affairs could continue to be scrutinised, and some information that had raised concerns would be best considered by the Financial Markets Authority.

Although Mr Bublitz wasn’t a director of Viaduct Capital, he had numerous other relationships with the start-up finance company, which wanted to raise $50 million from the public in term deposits & $5 million in capital notes. Viaduct signed a management services agreement with Mr Bublitz & one of his companies, Hunter Capital Group Ltd, in August 2009. Before & after that agreement was signed there were related-party transactions between Viaduct and Mr Bublitz & his interests which raised a string of questions from Treasury. In each case the company argued transactions were at arm’s length.

Mr Bublitz & 2 partners built up a large property portfolio in the 1990s and entered into a joint venture with NZI Life to own & develop commercial properties. In 1999 he founded Strategic Finance Ltd, left it in 2006 when Allco of Sydney bought in and re-entered the finance company market early in 2009 to support the development of Viaduct Capital.

More recently he’s been a director of Hunter Capital Ltd, Noske Kaeser Group Ltd & Titan Hunter Holdings Ltd.

Mr Wevers worked at Marac Finance Ltd in the 1980s. A brother of Sir Maarten Wevers, who retired as head of the Department of Prime Minister & Cabinet in 2012, Mr Wevers took the Government Property Service to listing as Capital Properties NZ Ltd in 1998 and led its expansion in 1999 through the takeover of Shortland Properties Ltd. Since then, he was briefly chief executive at Blue Chip Financial Solutions Ltd, also briefly a director of NZX-listed Kermadec Property Fund Ltd, managing director of ING Real Living Group when ING was looking at establishing a retirement village business, set up a property management company, and was an agent for Bayleys for a short time before opening an NAI Harcourts franchise on the other side of the Viaduct business centre courtyard. He was president of the Property Council for 3 years.

Mr Wevers quit as chief executive of Capital Properties NZ Ltd to take on the same role at financial services group Blue Chip NZ Ltd in time for its backdoor NZX listing through Newcall Group Ltd in June 2004.

Within weeks of listing, Blue Chip’s founder & 75% shareholder, Mark Bryers, was back on the board and Mr Wevers became managing director. But Mr Wevers didn’t last. Less than 3 months after listing, he resigned as managing director, making way for Mr Bryers to assume full control.

Mr Morrison was a director of Palmerston North accountancy firm Morrison Advisory Ltd, and then of Morrison Creed Advisory Ltd until he retired in October 2009. He was appointed a director of Mutual Finance in December 2009, along with Mr Bublitz & Paul Hocking, of Martinborough.

Mr Blackwood is a director of Rockefeller Finance Ltd & Rockefeller Funds Management Ltd. Mr McKay is a director of Esperance Capital Ltd & Saffron Capital Ltd. Mr Hocking is an independent director & chairman of the audit committee of Trustees Executors Ltd and the other director of Esperance Capital.

Earlier stories:

5 June 2012: Intensive development site above Albany wins consent, up for mortgagee tender fortnight later
21 June 2011: SFO closes Mutual Finance & Viaduct Capital investigation
31 December 2010: SFO launches investigation into Bublitz’s Mutual Finance
15 July 2010: Treasury withdrew guarantee from Viaduct Capital, gets caught by second Bublitz company
22 April 2009: Treasury withdraws guarantee from Wevers’ new company Viaduct Capital
6 March 2009: Wevers launches Viaduct Capital with $50 million prospectus
10 September 2004: Wevers out, Bryers takes over at Blue Chip

Attribution: FMA release, company checks.

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Treasury withdraws guarantee from Wevers’ new company Viaduct Capital

Published 22 April 2009

Treasury gave notice on Monday that it’s withdrawing the Crown retail deposit guarantee from Viaduct Capital Ltd, headed by Nic Wevers.

 

The Treasury notice said it was withdrawing the guarantee for all new deposits because it “reasonably considers that the business or affairs of Viaduct are being, or are intended or likely to be, carried on in a manner which:

 

(i) may extend the effective benefit of the Crown guarantee to persons who are not intended to receive that benefit, and

(ii) is otherwise inconsistent with the intentions of the Crown in entering into the guarantee.

 

Eligible deposits up to the date of withdrawal continue to be covered. Deposits covered by the guarantee include the principal sum deposited, along with interest accruing in accordance with the terms of the deposit, up to $1 million/depositor.

 

Treasury said Viaduct hadn’t failed and there was no event of default under the guarantee triggering the claims process. The notice said Treasury wouldn’t comment further at this stage, “due to commercial & legal considerations”.

 

Mr Wevers bought Noel & Kent Gillman’s small Christchurch finance company, Priority Finance Ltd, in February, renamed it Viaduct Capital and opened under the new name in March, with the guarantee and the launch of a $50 million prospectus.

 

Mr Wevers worked at Marac Finance Ltd in the 1980s and took the Government Property Service to listing as Capital Properties Ltd. Since then, he was briefly chief executive at Blue Chip Financial Solutions Ltd, also briefly a director of NZX-listed Kermadec Property Fund Ltd, then set up a property management company.

 

Executive director Bruce McKay has experience in financial modelling, business & strategic analysis covering a number of industries, including senior finance roles in companies involved in finance, transport, manufacturing, media, technology & retailing. He’s a board member of the Institute of Finance Professionals NZ.

 

Earlier stories:

6 March 2009: Wevers launches Viaduct Capital with $50 million prospectus

10 September 2004: Wevers out, Bryers takes over at Blue Chip

 

Want to comment? Email [email protected].

                                       

Attribution: Treasury release, story written by Bob Dey for the Bob Dey Property Report.

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Wevers launches Viaduct Capital with $50 million prospectus

Published 6 March 2009

Property investor Nic Wevers has bought a small Christchurch finance company and issued a prospectus seeking $50 million in debenture money, with the aim of lending on property & business.

 

Mr Wevers, with fellow director Bruce McKay, has bought  Noel & Kent Gillman’s Priority Finance Ltd and renamed it Viaduct Capital Ltd. It opens under the new name with a guarantee under the New Zealand deposit guarantee scheme covering secured & unsecured term deposits.

 

Mr Wevers worked at Marac Finance Ltd in the 1980s and took the Government Property Service to listing as Capital Properties Ltd. Since then, he was briefly chief executive at Blue Chip Financial Solutions Ltd, also briefly a director of NZX-listed Kermadec Property Fund Ltd, then set up a property management company.

 

Mr McKay, an executive director of Viaduct Capital, has experience in financial modelling, business & strategic analysis covering a number of industries, including senior finance roles in companies involved in finance, transport, manufacturing, media, technology & retailing. He’s a board member of the Institute of Finance Professionals NZ.

 

Mr Wevers said: “We believe that opportunities to finance good quality projects are now becoming available as asset prices reach levels that produce positive returns and stimulate investor interest. Further, the experience of our team will allow Viaduct Capital to acquire & actively manage receivables, fund business expansion and provide working capital directly or through factoring.”

 

At the date of takeover, 13 February, Viaduct Capital had investors’ funds comprising secured deposits of $7.39 million & capital notes of $850,000. Mr Wevers said he didn’t expect to fill the $50 million issue “in no time flat”.

 

He said the new owners had picked up a book of about 30 loans, mostly in the South Island, but would close those out and focus more on Auckland: “We’ll be all over, but being closer to home base is important.”

 

Investment in the company’s deposits are priced around 7% and for terms of 12-16 months. On the debit side, the company has to pay the Government 3% under the guarantee scheme as an unrated company.

 

Want to comment? Email [email protected].

                                       

Attribution: Company release, phone interview, story written by Bob Dey for the Bob Dey Property Report.

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