Author philosophical about book error

A clerical error in his latest book has cost Gareth Morgan dearly. Photo / Glenn Jeffrey

Gareth Morgan has had to fork out tens of thousands of dollars to fix a "clerical error" that meant he wrongly named and shamed a group of Auckland solicitors.

The embarrassing mistake occurred in his latest book self-published book, After the Panic - Surviving Bad Investments and Bad Advice, in which Morgan names the directors of failed finance companies - a move he now describes as "very bold".

Morgan listed the directors of failed finance company Provincial Finance Company Ltd - but got the wrong company.

An earlier company, with the same name, was struck off in 1996 and its five directors - the Auckland solicitors - are still listed on the Companies Office website.

Morgan said he learned of the mistake while driving to Whangarei shortly after the book was published in June.

"As soon as they let me know I thought, 'Oh my God'."

He ordered all unsold books to be pulled from bookstores and pulped, and then had 4000 new copies reprinted and distributed within 10 days.

This week Morgan was philosophical about the mistake, which he said cost him "heaps". Recalling the books and trashing them cost him $20,000, he said. He hoped to recoup the costs of reprinting from sales of the new books.

"All of my books usually sell," he added.

Morgan would not reveal the amount of the settlement with the wrongly named solicitors because of a confidentiality agreement, but eventually admitted the whole exercise had cost him tens of thousands of dollars.

That included having to publish lengthy apologies in the Public Notices columns of several major newspapers over the next couple of weeks.

The original Provincial Finance Ltd was set up in the 1980s by the Auckland solicitors who were all working for the same legal firm, with the idea of raising second mortgages for clients. But the company had "minimal" activity, according to one of the former directors, solicitor John Ray, and was eventually struck off in 1996.

The following year the directors of a finance company, Provincial Mortgage Company Ltd, took up the disbanded company name and changed its company name to Provincial Finance Ltd. That company went into receivership in 2006.

During the research for Morgan's book, the wrong company was searched and the five Auckland solicitors were named in After the Panic.

In the book, Morgan describes Provincial Finance Ltd as a company that "lent on used cars and many bad debts. Undercapitalised and at the lower end of the market. Poor management, weak balance sheets."

Ray told the Herald on Sunday he first heard he was named in Morgan's book from a client. "He was a pretty understanding guy, but he was looking at us sideways. The whole thing in our eyes had the potential to do a lot of damage."

One of the solicitors, a director of Presbyterian Support Services and handling large sums of money, was "understandably upset".

Negotiations between the two parties over the final wording of the apology and the amount of settlement had taken some months to settle.

* The gist on Gareth

Aged 56, he has a PhD in economics from Victoria University.

Struck it rich after helping son Sam Morgan expand Trade Me. The young Morgan sold out to Fairfax for $700 million and Morgan senior donated his $47m share to charity, setting up the Morgan Family Foundation.

Author of several books, including Pension Panic and the sequel, After the Panic, and another he co-wrote with John McCrystal on climate change, Poles Apart: Beyond the shouting, who's right about climate change.

His new book, due for release this week, is called Health Cheque: the truth we should all know about New Zealand's public health system.

Has a penchant for fast motorbikes.

Runs a boutique investment management firm, Gareth Morgan Investments, a KiwiSaver scheme and Infometrics.

- HERALD ON SUNDAY