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Wellington Capital PIF/Octaviar (MFS) PIF

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Cookie1 said:
Reports from Bentleys the liquidator's examination of David Kennedy in the NSW Supreme Court yesterday. It's a sad case and this is only the beginning....

From the Australian:
http://www.theaustralian.com.au/bus...staff-court-told/story-e6frg8zx-1225852944889

From the Sydney Morning Herald:
http://www.smh.com.au/business/cour...executives-hostile-culture-20100412-s46a.html

From the Age:
http://www.theage.com.au/business/mfs-spending-out-of-control-20100412-s42x.html
Click to expand...

Thanks Cookie, At last we are on the way to finding out the truth which led to the collapse of MFS/OCV and hopefully the details of where the PIF Funds were alledgedly illegally redirected.

No thanks to ASIC to date who were alerted to possible fraud and misconduct within the ranks of MFS/OCV directors and some other employees by PIF investors OVER TWO YEARS AGO!!!!

Is ASIC waiting for others to do the work and have the evidence handed to them on a plate? All will be revealed!! Seamisty (I hear the sale of brown undies have sky rocketed recently!!)

http://www.smh.com.au/business/rearguard-action-fails-for-big-jim-20100412-s469.html

ON THE RECORD

Octaviar's liquidators will be hoping the start of the hearing into the corporate disaster better known as MFS is not a harbinger of what is to come. Events got off to a slow start from the opening bell of the public grilling in the NSW Supreme Court yesterday.

Shortly after walking in, senior deputy registrar Andrew Musgrave mentioned that transcripts of the hearing should be available at the end of the day. But it was quickly pointed out to him that the courtroom did not have any microphones - needed to allow transcripts to be made - let alone a shorthand typist. Thus, the hearing had a late start of more than half an hour as those gathered waited for a typist to be quickly found.
 
From the article in the Australian today: "Mr Kennedy says he was effectively told to "back off"' by Mr King over his reservations about sending funds to the company's Dubai operations.

"He was pushing people for it to be done by yesterday," Mr Kennedy said. "He would push for things before the Is were dotted and the Ts were crossed."

At the Newcastle WC roadshow during question time an older man with an accent who was sitting near me asked JH if she knew that "the money" had been sent to Dubai - he repeated "that's where the money is!"

JH gave him an indignant look and basically went on to ignore the question/statement. Breaker, do you remember this? What did he know or suspect?
 
........ Anyone care to forcast how long this case will last??

Thank Goodness we have moved on from the last page........... I am sure that I am not the only one who cringed each time one scrolled down!!!
 
"The case, which will run for several weeks, is looking at certain transactions within the group, including $1bn of intercompany loans, the sale of assets and the granting of securities." - the Australian. The sale of assets session may well be very interesting...
 
http://www.etravelblackboard.com/showarticle.asp?id=103638&nav=130


MFS/Octaviar CFO dishes the dirt in court

'This week sees Octaviar, formally known as MFS Group, entering into the New South Wales Supreme Court as liquidators seek to determine who is responsible for the collapse, and when exactly the business became insolvent.


More than two years' after the MFS/OCV collapse we may finally find out just when the company was INSOLVENT!!!!

Nick Nichols and his reporting skillls conspicuous by their absence?????

Seamisty
 
THE SAGA CONTINUES!!!!! Extracts from the link below. Seamisty

Octaviar exec 'refused to sign document' April 13, 2010 - 6:59PM

http://news.smh.com.au/breaking-new...c-refused-to-sign-document-20100413-s7e8.html


A former senior executive at the failed Octaviar Ltd says he was asked to sign backdated documents about a board meeting he never attended, a court has heard.

Former Octaviar chief operating officer David Kennedy says he was asked in February 2008 to sign minutes of a board meeting supposedly held in some time in November 2007.

But he refused, telling the NSW Supreme Court on Tuesday that he had no knowledge of the meeting.

"They were backdated documents and I didn't recall having that meeting," Mr Kennedy told the court.

"I have never knowingly backdated any document.

"That's fraught with danger."

Mr Kennedy said that some time later he was shown the "exact same minutes that had me listed as an apology".


Mr Kennedy also unloaded on KordaMentha, which former MFS chief executive and deputy chief executive Craig White engaged in January after the corporate advisory firm indicated it had potential suitors willing to invest in the company.

Mr Kennedy criticised KordaMentha's "excessive fees" and said the nine or ten staff working in the MFS office was "more about giving comfort to the board" rather than doing something to help the company."

"I thought they were a waste of money," Mr Kennedy said.

He brought his concerns directly to KordaMentha partner Mark Korda in February 2008.

During a discussion Mr Korda said employees of the failed airline Ansett back got about 99 cents in the dollar.

Mr Kennedy told the court he responded: "To me that just means unsecured creditors got nothing".

After the discussion, Mr Kennedy told the court he was asked by Mr White to "back off".

The examination before senior deputy registrar Andrew Musgrave continues on Wednesday, with Mr Kennedy to face questions for a third day.
 
For PIF investors receiving centrelink payments please note that PIF units are being offered for sale on the NSX for a pitiful 8cents!!! Todays sales started at 0.085 and the last trade was 0.080. The current highest bid is for 100,000 units @ 0.071 followed by another bid of 100,000 @ 0.065.

Wellington Capital merchant Bank and their team of experts can take the credit for the abysmal NSX PIF unit price performance, the blame lies entirely with their lack of ability to take this Fund forward to date as originally promised.

Seamisty
 
The latest PIF unit price is confirmation that the worst fears regularly expressed on this forum about WC's capabilities are well founded. I still believe that an EGM is required urgently, but that proposition doesn't appear to have much support. If it were a good tactic, I guess the AG would have planned for such a meeting.
 
selciper, in my view it is all a question of timing. Given what is coming out of the Liquidators examination, it is worth waiting to see how Bentleys and ASIC react. Just the little that has emerged (fabricating and back dating of Board Minutes etc) coupled with what is contained in the amended ASIC application before the Brisbane Supreme Court, it is starting to look like gaol time for some of the MFS pack.

And I think that the class action may need to include others - other MFS Directors who may not have advised ASIC about their concerns about the theft from PIF, Korda Mentha for not detecting the theft, RBS for lending money without any security details that were only fraudulently supplied nearly 2 months later, Fortress for taking the funds when they knew MFS did not have cash to meet the repayment deadline and Delloitts for not detecting the fraud, the CBA branch that advanced the PIF funds to Fortress after approval from Perpetual who did not adequately check whether the funds would be applied for proper purposes as per the PIF Constitution - and there will be more.

And then there is the future examination of JH and WC over possible unfair payments of $5M and $3M as directed by Justice McMurdo in his judgement, and how you can gain the RE of a fund for no real payment.

There is a long way to go on this one - and it won't do our case any harm to have the PIF losses maximised before we sue the pants off all those responsible. As a lawyer colleague of mine frequently used to say - Don't get angry, get litigious!
 
Marcom - I enjoyed reading your detailed list of possible positives that can develop over time in this three ring circus that we PIF investors now inhabit. Thanks. I'll do my best to keep patient.
 
Yes Marcom, patience will be a key issue for future actions. I strongly suspect we are in for some interesting reading over the next few weeks! Failing memories and buck passing will no doubt be out in abundance. Seamisty
Extracted from the below article::

Ex-Octaviar boss can't recall sign-offs JORDAN CHONG
April 14, 2010 - 7:04PMEx-Octaviar boss can't recall sign-offs JORDAN CHONG


A former senior executive at Octaviar Ltd says he does not recall signing documents certifying the accounts or approving certain transactions of various subsidiaries of the failed company, a court has heard.

Former Octaviar chief operating officer David Kennedy told the NSW Supreme Court on Wednesday that although he could not recall signing certain documents, he would have only done so based on the assurances of others.

"I relied upon representations made to me," Mr Kennedy told the court.

"I would have relied extremely heavily on David Anderson."

He described Mr Anderson, a fellow senior executive, as a man of "extreme integrity" and "beyond reproach".

"If a document came to me to sign and I wouldn't know about it, I wouldn't sign," Mr Kennedy said.


He was also questioned by lawyers for liquidators of Octaviar Investment Notes Ltd and Octaviar Investment Bonds Ltd - two subsidiaries of parent company Octaviar - who showed him a series of documents bearing his signature.

These included one showing he had signed off on a $17.5 million funds' transfer to MFS Pacific Finance Ltd, a New Zealand-registered company.

Another was the accounts of MFS Financial Services for the year ending June 2007, where the balance sheet had net assets of $138 million.

The accounts for the period ending June 2008 showed MFS Financial Services had zero net assets.

Asked if he knew why, Mr Kennedy responded: "Absolutely not".

Asked about a letter in January 2008 regarding a default on the loan with Fortress Credit, Mr Kennedy replied: "I certainly don't recall seeing it."::::
 
It looks like WC is somehow maximising the fund's losses, as marcom has so brilliantly deduced.

What about the PIF investors who have to sell and the ones part of a PIF investor estate?
This does not seem fair and looks like the richer will just get richer.

As going by previous court proceedings involving our PIF and up and coming ones(ie class action, etc), all will fail and nothing given back to any PIF investor.
People may go to jail but it does not get my money back.
You all do not seem to realise that because Andrew Peacock was with MFS
and then Labor came to power, means they are still laughing at its
demise and will never help us. Better hope the Liberals get in.

I still say thet WC must resign and give to someone else.
 
On the trail of the missing millions and the Dubai connection -

"HUNDREDS of millions of dollars disappeared from MFS company accounts in a 12-month period, the NSW Supreme Court heard yesterday.

Barrister Dominic O'Sullivan showed Mr Kennedy the accounts of various MFS companies, one of which had net assets of $138m at the end of 2007 but by June 2008 had zero assets.

"Do you have any information about why that might be the case?" Mr O'Sullivan said.

"Absolutely not," Mr Kennedy replied.

Another company had $139m cash in the bank in 2007, which later disappeared. Mr Kennedy said he did not know where the money went."

And just in time this article in today's SMH: ATO turns focus on foreign accounts of at least 100,000 customers. http://www.smh.com.au/business/ato-...-at-least-100000-customers-20100414-se36.html
PETER MARTIN ECONOMICS CORRESPONDENT
April 15, 2010

THE Tax Office has ramped up pressure on Australians with undeclared accounts in tax havens by gazetting orders allowing it to question 57 Australian institutions about the behaviour of at least 100,000 customers.

The orders allow the Tax Office to ask institutions including Westpac, Mastercard and Citibank Australia about customers who have merely made inquiries about setting up overseas accounts.

''Sometimes the bank will have an operation in a tax haven and put their customers in touch; other times they will refer their customers to foreign institutions with which they have arrangements,'' assistant commissioner Malcolm Allen told the Herald.

''We will ask for those records, approach the customers and say, 'at one stage you were interested in opening an account in this country, what did you end up doing?'''

Most of the institutions on the list have agreed to hand the information to the Tax Office rather than challenge the order. The order also empowers the office to ask for details of a broader range of transfers than those routinely reported to Austrac, including transfers by credit card and cheques.

''We have asked for this information in the past, but generally only in specific cases. This is a more strategic operation,'' Mr Allen said.

''We will be seeking records about anyone who has ever made such inquiries between July 2005 and June 2009.''

Among the 48 so-called secrecy jurisdictions and countries of interest covered by the order are Malta, Cyprus, the Cayman Islands, Britain and New Zealand, which are ''often used as conduits to offshore jurisdictions of interest to the Tax Office'', Mr Allen said.

The Tax Commissioner, Michael D'Ascenzo, stressed there was ''nothing wrong with holding an offshore account or investing overseas as long as you pay any Australian tax due''.

''Our aim is to identify people who may be deliberately trying to hide income or assets offshore. I urge them to come to us before we come to them.''

An amnesty-like arrangement announced in November gives Australians with undeclared overseas accounts until June 30 to come forward in return for reduced penalties and the chance of an assurance they will not face criminal investigation.

Mr Allen said: ''They come in on a no-names basis, and on the basis of the facts they have given us we will tell them whether or not we would be looking at initiating a criminal investigation.

''With that advice from us they can then come forward and make that disclosure in the knowledge that that is not going to happen.''

Since November about 150 taxpayers have come forward, declaring foreign accounts worth $18 million. ''But the experience with similar initiatives offshore is that most people make those disclosures towards the end of the period. It takes a while to think about what to do, get information together and talk to advisers; generally about 70 days,'' Mr Allen said.

''If people are going to take up the offer by June 30 they need to be thinking about it now,'' he said, stressing that the ''no-names'' offer of anonymous advice would end then too.
 
here is the batting order for the Bentley's examinations of MFS/Otaviar directors:

Public Examinations: commencing on 12 April 2010.

The first tranche of public examinations for the liquidation of Octaviar Administration Pty Ltd will commence on 12 April 2010 at 11.00am.

There has been a recent change of venue for the public examinations. The public examinations will now be held at:

Court 3.2
Industrial Relations Commission
47 Bridge Street
Sydney NSW 2000

The following key personnel will be examined in the first tranche:

* David Kennedy
* Kim Kercher
* Craig White
* David Anderson
* Michael King

If you have any questions please forward an email to Octaviar@bris.bentleys.com.au
 
There are rumours that Carney's and the others have got wind of that
WC is somehow maximising the fund's losses, so as a favourable outcome, comes out from the class action.

If this is true then this is very unfair on PIF investors who have to sell and the ones part of a PIF investor estate.

As I have iterated many times:-

WC must resign and hand the fund to someone else.
 
http://www.lexology.com/library/detail.aspx?g=7902c2da-a669-42ee-a5b9-7b64e6edbf32

Australia
April 15 2010
In brief

The first part of the Australian Consumer Law reforms is effective today.
Businesses should ensure that they are familiar with the implications of the Australian Consumer Law and implement appropriate risk management procedures.
The Australian Consumer Law Bill 2009 has received Royal Assent and the first part of the Australian Consumer Law reforms are effective today. The Australian Consumer Law amends the Trade Practices Act 1974 and Australian Securities and Investments Commission Act 2001.

From today, 15 April 2010, the ACCC and ASIC can take actions seeking monetary penalties of up to $1.1 million against corporations and $220,000 against individuals that make false or misleading representations or engage in unconscionable conduct.

This change will have enormous ramifications. To date, monetary penalties have only been available in criminal prosecution, requiring proof "beyond reasonable doubt". A civil penalty regime requires a lower onus of proof (the "balance of probabilities").

There is likely to be a significant increase in actions being commenced by the ACCC (and ASIC) in respect of misleading or deceptive conduct.

In addition, from today the ACCC and ASIC have additional investigatory and enforcement powers to seek or issue:

disqualification orders;
substantiation notices;
orders to redress loss or damage suffered by non-party consumers;
infringement notices; and
public warning notices.
Second part of the Australian Consumer Law reforms

The second part of the Australian Consumer Law reforms dealing with unfair contract terms will come into effect on 1 July 2010. Those reforms will void unfair terms in standard form business-consumer contracts. The ACCC announced today that it intends to provide public guidance to business and consumer organisations prior to the unfair contract terms regime coming into force.

Businesses should ensure that they are familiar with the implications of the Australian Consumer Law and implement appropriate risk management procedures. This should include reviewing any business-consumer standard form contracts and implementing comprehensive documentation policies to enable companies to quickly and effectively defend any queries by the regulators about marketing activities or other business conduct.
 

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