Samantha Barrass, chief executive of the Financial Markets Authority. Photo / Supplied
Samantha Barrass, chief executive of the Financial Markets Authority. Photo / Supplied
Rowan Kearns, the former sole director of the Forestlands Group, has pleaded guilty to several charges related to disclosure and financial record keeping.
Three charges were brought by the Financial Markets Authority (FMA) against Kearns in September 2020 and were expected to be tried by jury in March 2023 following an initialnot-guilty plea.
At the time of the filing, the FMA said security arrangements of a million-dollar loan were knowingly omitted from financial statements, misrepresenting the financial position to investors.
With Kearns’ guilty plea, the case will progress directly to sentencing at the Nelson district court on May 2.
Two of the charges brought by the FMA related to the Financial Reporting Act 1993. One was for making a false statement, which carries a maximum penalty of five years’ imprisonment or a $200,000 fine, and the other was for failing to deliver financial statements, a maximum of a $100,000 fine.
The third charge of failing to lodge financial statements under the Financial Markets Conduct Act 2013, carries a maximum penalty of a $50,000 fine.
Background
The FMA began investigating the Forestlands group of companies in 2017 following a series of complaints from investors.
It was found that Kearns set up 18 companies to solicit investment to generate fees and other returns to Kearns’ family trust and other entities owned by Kearns and his wife Sharon Kearns.
Forestlands owned 1,934 hectares of forest land through a group of companies on the east coast of the North Island and in the south-west of the South Island, according to its website.
In 2018, the Nelson high court appointed KordaMentha to liquidate the companies.
