Mark Hotchin

ᔥ NZ Herald

Does anyone else find it strange that hte Herald and cub reporter David Fisher fawns all over a convicted embezzler and insider-trading, currently facing more charges fat, jolly, German fellow and his every utterance but maintains open hostility to another Kiwi citizen who so far remains un-charged for any crime and yet has all his assets frozen.

Every time the German fratboy goes to court to get his assets unfrozen the media laps it, yet when Mark Hotchin goes to court they snarl and snap.

Comparing the the two cases becomes very Fawlty Towers-esque…especially with the wife. Whatever you do don’t mention the wh….

Cactus Kate has an opinion piece in the NZ Herald this morning excoriating the dirty underhand way the FMA is dealing with the Hanover case.

Fittingly on April Fools morning, it came down to Sean Hughes from the Financial Markets Authority chest-beating civil proceedings against six Hanover directors and loosely termed “promoters”.

At least one individual claims to have not received the 69 pages of Statement of Claim at the time of Hughes’ very public announcement.

Hanover was deliberately sensationalised by leaks, drip-fed to media and anti-big business bloggers as their conduit. Should you attempt blogging balance, within minutes hatemail hit the inbox invoking your deceased Grandmother’s legacy.

It was billed as the FMA’s show-stopper but sizzled like cold sausages on the Mad Butcher’s gasless barbecue to just $35 million from a 7-month timeframe, an unknown tiny percentage of investors with civil proceedings involving alleged prospectus violations that unless a suitably vintaged professional, no one has a hope of comprehending.

That is interesting, because just yesterday the full 69 page statement of claim in the proceedings was leaked to the NBR (subscriber content)…looks like more underhand tactics from the FMA intent on running the case in the media rather than in the court room.

The FMA played a dirty game freezing whipping-boy Mark Hotchin’s assets back in December 2010. They strategically stretched the truth and patience of Justice Winkelmann in a way the writers of Shortland Street could not beat with Christmas specials as tantalising. Last year more promises until Hughes paraded himself unquestioned by business media on morning television as a big game hunter back from a shoot with the equivalent of the head of an aged tame pet goat.

It is not uncommon for regulators to play with accused through media. They know conservative lawyers advise clients to keep silent. It may be legally sage but lacks commerciality as business is all about investor confidence and telling your story first.

The FMA know the battle that goes on between client and adviser and milked it for all it is worth, knowing the first wave of bad publicity Hotchin received was almost impossible to come back from.

The moment there are market rumours of an investigation your life is effectively stalled and close to ruin.

The family ask questions, friends shun you, bankers stop taking you out in public and even the kids’ schoolteachers start gossip.

And the bottom line is after all the bluster and all the puffery and all the delays from Sean Hughes and the FMA, all they have come up with is a 69 page statement of claim and civil action against the directors and promoters of Hanover.

Cactus Kate suggests the FMA would ahve been better advised to look closely at the asset stripping and destruction wrought by Rob Alloway at Allied:

Precisely what happened to investor value since is where a more worthy FMA investigation should lie. Allied professionally due diligenced Hanover, accepted the deal, cherry picked $100 million of value off the tree and oversaw the ultimate loss of value. Allied then conveniently blamed Hanover after stripping out assets directors wished to keep.

Sean Hughes has been clear that no criminal intent was present in Hanover and pumped these civil pleadings as the “easiest” for the FMA to prove.

A civil action on behalf of a select few investors for 7 per cent of total value of funds invested.

ᔥ NZ Herald

Damien Grant has some balls, he has said what many are now whispering.

It is deeply frustrating to see public funds being wasted to defend those who lost money in the Hanover debacle.

What is often forgotten in this long-running saga is that any of the 16,000 investors who lost money in Hanover have been entitled to avail themselves of the same sections of the Securities Act that the FMA has elected to use.

They have not. Not one of the 16,000. Yet taxpayers are funding this expensive legal fishing trip on their behalf.

He is dead right. The FMA have shown they don;t have the gonads to pursue criminal charges and instead have gone all limp-dicked and decided after many, many months that they will focus on but a few paragraphs and some misplaces semicolons and commas and proceed with a civil action.

Their reasoning is that the threshold for proof is lower and so they have more chance of success…in other words they are not entirely sure of their case so are going for a slap on the hand with an extremely wet bus ticket. Sean Hughes has proven to be all mouth and no trousers.

The FMA seeks to restore confidence in the securities market and they are entitled and perhaps even obligated to pursue this matter. Yet I find something disquieting about seeing Hotchin’s assets frozen for more than a year, not charged with any crime and having a civil case against him funded by taxpayers rather than those who suffered losses. If only he were as charming as Kim Dotcom.

This is a very good point. A man who still is not charged with any crime has had his assets frozen indefinitely. This is an outrage, both constitutionally and legally.

If the FMA wins, the aggrieved Hanoverians will get paltry compensation and taxpayers will get some, but not all, of their legal costs back. If the FMA loses, as it very well may, taxpayers will get what we always get. The bill.

Still at least the taxpayer hasn’t had to bail out Hanoever like it did with South Canterbury Finance.

The FMA’s case is this: Hotchin, Watson, Sir Tipene and others agreed to the release of a prospectus, and possibly some advertising, to the public. That prospectus and or said advertising contained untrue statements. If these two things are correct then those named face civil liability for the losses suffered.

They could face a pecuniary penalty as well but the FMA must bring this case within two years of finding the dishonesty so it may be too late. Seeking a pecuniary penalty is an action limited to the FMA.

However, before any compensation is awarded it must be shown that money was invested “on the faith of an advertisement or registered prospectus”.

It seems unlikely that those who invested in Hanover were reading the prospectuses being issued, even more unlikely to have been influenced by their contents. They recognised the brand, liked Richard Long, and would not know an Ebit from an elf.

I bet that “investors” simply looked at the headline rate advertised. Never read a single line fo the prospectus and simply wrote cheques to their broker.

However, the 16,000 have an even bigger problem winning any compensation because, back in 2009, they elected to swap their impaired debt for shares in Allied Farmers.

Now, that deal looks to have been about as smart as kissing a scorpion but that is what these “investors” did.

Guardian Trust, at the time, told them they needed to weigh up what they were giving up for “… an investment in Allied, which may be traded on the stock market at the prevailing market price” before pointing out that the prevailing market price would be lower than Allied’s current price.

They walked away from their rights as bond holders when they voted for that deal.

If they want to sue someone for their past mistakes let them do so on their own dime.

It is very hard to disagree with Damien Grant isn’t it?

ᔥ NBR

John Bowie channels Cactus Kate on Hanover:

You would have to say the Financial Markets Authority’s civil suit against the Hanover directors is something of a damp squid [sic] after a long three-year wait by out-of-pocket investors.

The anticipation of a criminal trial and the front-page-ranking of frozen Hotchin assets, as if he were the only director, has evaporated like morning dew. The small civil claim, being for a mere $35 million for which the directors may even be covered by insurance, will achieve next to nothing.

All eyes must now turn to Tim Rainey, the Auckland litigator representing something over 2500 investors, to see if he can turn up the recovery heat with his own action. But without the FMA resources to shoot home any liability, investors will doubtless not be holding their collective breath.

It would be interesting to find out how much the FMA begged Hanover to settle out of court so they could claim a victory…I guess we will never know now. The FMA talked large for more 15 months…they delayed and delayed and delayed, and this is all they have come up with, a pissy little civil action…John Bowie is right, this is small beer indeed.

ᔥ Cactus Kate

Cactus Kate isn’t impressed with the limp dick response of the Financial Markets Authority:

The latest in this regulatory debacle appears to be that charges have been laid, on Friday 30th March, a day before accounting year end against six directors totalling a mere $35 million or $5.8 million each. The closest Sean Hughes and his clowns at the FMA could have got to April Fools Day.

$35 million - less than the alleged $40 million cost of the Hotchin house that has become a symbol of the Hanover case. Hughes believes that this prospectus based civil prosecution is the strongest they have.

Once again I ask – how many of those investors even bothered to read the prospectus? Such is the silliness of charges based on a document that most Mum and Dad investors would not have even opened. For example Richard Long was not named as a promoter which is interesting. More Mum and Dad investors would have put their money in based on his recommendation than the prospectus documents. I would be looking to put each investor, or a random cross section on the stand and ask them precisely why they invested in Hanover and then analyze their knowledge of the actual prospectus they allegedly relied on that resulted in that loss.

April Fools Day fell on a Sunday this year. Therefore denying us this complete fairytale ending. Although not quite, the FMA seem to have confirmed the charges on April Fools Day with Sean Hughes appearing on television prior to midday to swing his now rather shriveled excalibur.

Basically it appears that the FMA civil action hangs on a few misplaced commas and poor grammar in just a few sentences:

But what he has achieved here after talking up a game really is the equivalent of a parking fine. Fraud and jail to begin with, now a technical prospectus civil prosecution.

We also have a regulatory authority that appears on television to announce charges to the public after the past six months getting the public used to the simple fact they could not pin a $500 million criminal fraud on Hanover. The magic number being chucked around with all sorts of dirty allegations about Mark Hotchin and Eric Watson.

Mark Hotchin just one of the six directors, suffered 15 months of asset freeze on what seems to be just the trust’s Paritai Dr property left.

Investigations have been ongoing for three whole years to get us to this point.

There will be no criminal prosecution from the FMA. Hughes made this comment today.

I explained to the public back in December that we did not think that this case merited a criminal prosecution. That was certainly the advice that we received, and were comfortable with that outcome.

If you were a woman in a bar and Sean Hughes picked you up promising this much and on return to his home he whipped this out, you’d laugh, run outside and call for a cab home.

Heh, spanked like only Cactus can spank.

The race for the National aprty nomination for Tamaki is between these five:

I have been forwarded a summary of candidate biographies by the electorate chair, Andrew Hunt, who is making a good fist of the selection. HE is approachable and seems to be be running everything precisely by the rules. He has sent me the summary because candidates aren;t allowed to talk to media.

Candidate Bios

My summary will follow the same format as previous selections. Links on their names are to their iPredict stock.

Denise Krum:

Selection Record: Maungakiekie 2008 (Successfully won selection for United Future), Botany 2011 (Did not make it through Preselection),  Epsom 2011 (Dropped at 2nd ballot)

Denise is a pleasant journey woman who is unlikely to make mistakes as an MP, but also unlikely to make an impact. Her solid and stable family background and Christian values platform may endear her to some locals. A female MP for Tamaki would be a first, and probably not a bad thing either. If Krum can present more like a corporate and less like a suburban housewife, she would have the potential to win the selection.

Advantages:

• strong track record of community involvement including getting seriously off side with Greenpeace after cleaning up the Ellerslie town centre and having them poster it with anti corporate messages.
• Political background including father Graeme Lee being a former National MP.
• Would help the gender balance in the National caucus

Disadvantages:

• Political background including father Graeme Lee being a former National MP.
• Ran for United Future in 2008
• Was United Future Party President
• A very attractive woman who’s causal dress sense and hippy style hair does not do her justice
• Needs serious speech training to stop her coming across as a stoner.
• No proven track record as a vote winner
• Has not won a selection so far and Tamaki may not want a woman who is a repeat loser

Toni Millar:

Selection Record: To this blogs knowledge has not stood for National Selection previously

A former local councillor with a reputation for abrasiveness and bossiness. Her strong local connections 9she has lived in the electorate for decades) would make her an excellent candidate for right now, but her “spoilt child” reputation proceeds her, and will turn off some delegates. Local community groups would adore Millar as the local candidate, as she is a very social person. Not one to make a contribution to policy – think of her as a Sandra Goudie without gumboots. No longer married, but also no children, which means she would have the time to apply to the role of ribbon cutter. Would be an effective local MP and loyal to the party. Her weight might be held against her by some delegates.

Advantages

• Proven electability as a C&R councilor on the old Auckland City Council
• Experienced political operator who would have a head start on newbies in parliament
• Great links into a wide range of community groups
• Very good with voter contact and very good manner with voters
• Known to enjoy doing the hard yards in her electorate, and enjoy the contact with constituents
• Would help the gender balance in caucus
• Would not mind taking on hostile audiences of morons like teachers unions as she is known to have a hide like a rhinoceros

Disadvantages

• An assertive woman in a world where assertiveness in women can unfairly be used to call a woman a “school marm”, “bossy” or “a bitch”
• Former Teacher
• Would not add to the intellectual and policy heft of the party
• Perhaps not the best long term prospect

Simon O’Connor:

Selection Record: Stood unsuccessfully for selection in Maungakiekie in 2008.

Seen as a nice fellow, a hard working volunteer for the party over the years, but not considered a rising star. O’Connor used to be a priest in training, but mysteriously left the seminary with his studies uncompleted. However, his Catholic connections will probably be popular in Tamaki. He is unmarried, so may be seen as less than settled as a choice for a conservative seat like that. Has not been a seat candidate for National before, was unsuccessful as a local board candidate for the Waitemata ward in 2010. He is a Contracts Manager for Southern Cross Health Society

The selection in Maungakiekie in 2008 was marked by extreme unethical behaviour, with O’Connor and the electorate chair trying to stack selection in O’Connor’s favour against Peseta Sam Lotu-Iiga. O’Connor then went on the offensive to attack Sam on the grounds he was a councillor and could not campaign properly due to his council responsibilities. Like Brent Robinson in Rodney, O’Connor lost.

What is it with fundies and unethical selection campaigns? Maybe we need to get candidates to swear on the bible they will not be unethical during selection.

Advantages

• None

Disadvantages

• Unethical selection campaign in 2008 means he will never receive a positive comments from this blog.

Seby Reeves:

Selection Record: None

I have never heard of him, but who is reputedly an early 30-something lawyer, is unlikely to have upset anyone, and so could become everyone’s second choice because he hasn’t done enough to cause people to vote against him. It is unconfirmed if he has a strong party connection. He is the son of Graeme Reeves.

Advantages

• No previous negative form in National, meaning if he presents well, works the delegate list hard and delivers the best speech on the night he has a chance.
• People will not have formed an opinion of him, so he has a chance to convince them to vote for him in a weak field.

Disadvantages

• Unknown in National
• Looks like an opportunist.

Mark Thomas:

Selection Record: Successful Wellington Central 1996. (Bolger shafted him so Prebble could win the seat).

Current Orakei Board member, with a reputation for talking but not walking. Thomas has a number of negatives causing political risk to National. His work as PR stooge for Mark Hotchin would be poison to locals and a bright shiny bullseye for Labour. Thomas is unmarried with children, which won’t be popular with locals either. His becoming an MP would also trigger an expensive by-election for Auckland ratepayers, or potentially cause another round of double-dipping accusations like Sam Lotu-iiga went through. Famously knifed by Bolger in Wellington Central in 1996. Comes across as a bit effeminate.

Advantages

• Of the known candidates Mark is the most talented and has done more good for the National Party
• Sound strategic and political mind, and a good backroom operator
• Will present well and speak well, with a very clear, logical message

Disadvantages

• Too close to party president Peter Goodfellow, who has no support in Tamaki
• Good talker, not such a good walker
• PR man for Mark Hotchin, which will be used against him
• To intellectual to be really liked by middle New Zealand and not great at pressing the flesh
• Not a retail politician
• Unfairly blamed for Melissa Lees campaign debacle, rather than being credited for the highly successful campaign for Sam Lotu-Iiga in Maungakiekie in 2008

A note for readers: The tip line has been running hot with all sorts of stories about marriage, sexuality and other personal details. I do not believe these points deserve public airing, and I also do not believe they will be factors in selection. In 1976 Marilyn Waring was outed by the Truth, but remained in parliament until 1984, with the provincial New Zealand seats of Raglan and Waipa accepting her for who she was rather than being all preachy and judgmental.

The SFO has announced that the Mr Magoo of New Zealand finance is to face 50 charges.

The Serious Fraud Office has confirmed it has laid 50 charges against failed financier Allan Hubbard.

SFO chief executive Adam Feeley said in a statement just released: “after an exhaustive investigation, we have concluded that there is sufficient evidence to lay fraud charges against Mr Hubbard.”

Feeley said that fifty charges under sections 220, 242 and 260 of the Crimes Act had been laid today in the District Court in Timaru.

The SFO said it did not intend to lay charges against any other current or former director of Aorangi Securities Limited.

This man has cost the taxpayer billions in the collapse of his fancy Ponzi scheme called South Canterbury Finance. It is evident now that the SCF should never have been in the deposit guarantee scheme in the first place.

The pity is he will be long dead before the SFO can sort out its internal mess and even start to prosecute this case.

This case now provides stark contrast with the case of the treatment of Mark Hotchin by the authorities and the media. Mr Magoo cost this country billions because of the guarantee scheme, the depositors all got their money back and now Mr Magoo faces charges. Meanwhile Hanover cost the taxpayers nothing and as a reward for that Mark Hotchin is being victimised by authorities who so far, after looking for many months longer than they have for Hubbard have come up with nothing.

Let’s see the media now go into a frenzy over Hubbard and while they are at it go ask some very pointed questions of the Finance Minister as to why SCF was even in the scheme to start with. It is as clear as the nose on my face that there was material differences between stated positions.

Schlock Jock Anderson has still got a bad case of Hotchin Derangement Syndrome and the NBR is still trying to sell subscriptions to their paid content by selling off of the back of Mark Hotchin.

The latest example shows just how low, their ethics, and their editing qualities have sunk. Despite their vaunted techno solutions to prevent people spreading their stories around no matter how poor quality they are, here is a taste of their crap.

Not only is Schlock Jock Anderson suffering from a bad case of Hotchin Derangement Syndrome but he is now also using the name of Rodney Hide to try to sell subscriptions.

Anyone learned person easily knows that Jekyll and Hyde is spelled with a ‘Y’ and to spell it with an ‘i’ is only serving to use another persons name in an attempt to get readers to buy content.

Apart form the outrageous headline, attempting to leverage of the Hotchin name, Schlock Jock Anderson then proceeds to mangle a few facts into a whole lot of un-necessary paragraphs repeating several times the “Hide” error. About the only mainstream media technique he didn’t use in this poor quality schlock piece was to use his now infamous epithet:

Perhaps he is learning. Cactus Kate certainly bashed him hard the last time he went all silly and she doesn’t hold back now either.

In her post slamming him before she called him “Shock” Jock ANderson. After this poor showing I think he really should be called “Schlock” Jock Anderson.

The Wikipedia description of the word “schlock” certain seems to apply:

Schlock is an English word of Yiddish origin meaning “something cheap, shoddy, or inferior (perhaps from German Schlag, Yiddish shlak, meaning ‘a stroke’)”

In the field of science, “schlock” refers to shoddy or unreliable results. In art, “schlock” is sometimes used as a synonym for kitsch.

The insistence of mainstream media outlets to continue to try to sell papers and content with sensationalist headlines and outrageous word-smithing is certainly” cheap, shoddy and inferior”. It is the sort of thing Barry Colman accuses bloggers of in his attempt to remain high-brow and charge for his schlock content.

A man I was convicted of naming was today convicted of indecent assault.

A former prominent figure was today found guilty of indecent assault on a girl after a trial in the Nelson District Court.

The man who faced three charges of indecent assault has name suppression.

The jury took 14 hours to reach its guilty verdict on all three charges after a three-day hearing.

The Crown says the assaults happened at a Nelson house on December 30, 2009.

The Crown said the man touched the girl on the breasts while they were alone watching TV in the living room.

The man indecently assaulted the girl later when she had gone to bed, by touching her leg and genitalia with his fingers and then kissing her on the back when she rolled away, the Crown said.

The defence maintains the events did not take place. The man was remanded on bail until June 16 for sentencing.

So now a man convicted of indecent assault is roaming free on bail in Nelson until his sentencing. No one is allowed to know who this sexual predator is. Why can he not be named? Surely the Cappill precedent could be used.

I wonder if the Herald will spend more $100,000 pursuing this man like they did with Mark Hotchin?

The other thing is this man breaks one of Whaleoil’s Rules of Politics.

I see yesterday that Mark Hotchin has finally had a gutsful of the witchhunt being run at the NZ Herald by them and in particular Brian Gaynor. He has decided to sue their arses off them for defamation.

Former Hanover Finance director Mark Hotchin is suing the Herald and leading business commentator Brian Gaynor for defamation over criticisms about the company’s collapse.

In a statement of claim lodged with the High Court at Auckland, Hotchin referred to a number of columns and a profile feature published in the Weekend Herald between 2008 and 2011.

It says the articles had damaged his personal and commercial reputation and caused him to lose commercial opportunities in Australia and New Zealand.

The Herald attempts to editorialise in their headline claiming they are being sued for “alleged defamation”. You can’t of course be sued for alleged anything let alone defamation but that didn’t stop the herald.

I’m surprised they didn’t mention John Hotchin as the brother of Mark. i am also still waiting for The Herald to spend the same amount of money finding out the name of the politician with the secret dogs names as they spent overturning the historic name suppression of a victim.

I imagine that some of the evidence may well relate to the persecution and witch0hunt that the Herald has pursued against Mark Hotchin. There have been 125 days this year so far and the Herald has amassed 66 articles online that mention Mark Hotchin in the same time period. That is one article every two days.

To put that in perspective a similar search for Don Brash shows just 80 articles since the beginning of the year and most of those are in the past two weeks with more than 40. The other 40 are spread over the whole time period.

It is clear that the Herald has been running a campaign against Mark Hotchin in a bid to sell papers. I think he may well have a good case here.