Apologetic Hotchin cries poor in PR blitz

Mark Hotchin arrives at the TVNZ studios for the Close Up interview last night. Photo / Dean Purcell

Hanover Finance founder Mark Hotchin launched a public relations blitz last night, saying he was broke and sorry - but not afraid to walk the streets.

At times sounding slightly nervous, Mr Hotchin told TVNZ's Close Up that he had not been living a life of luxury and that his personal worth was now "incredibly low".

When host Mark Sainsbury said, "You're not broke, are you?", Mr Hotchin replied, "I am at the moment", and denied having any money "stashed away".

"My personal worth is incredibly low ... I've got assets frozen. I've got bills to pay, I've got tax to pay ... I can tell you that my financial position now compared to, say, three years ago is dramatically different.

"I don't have money stashed away. I've had to fill this out for the Securities Commission, for the courts etc - there's no money stashed away."

When it was put to him that he was still a millionaire, Mr Hotchin, dressed in a smart suit and yellow tie, said: "No, well at the moment I'm far from a millionaire."

Late last year, the Securities Commission froze his assets in case any of the 16,500 out-of-pocket Hanover investors wanted to bring civil claims against the company and its directors.

The commission allowed him $1000 a week to live on. He initially said it wasn't enough for him and his family.

He is now in a court battle to get the freeze order lifted. This week, a High Court judge reserved her decision.

Mr Hotchin's lifestyle has created a furore. Attention has been focused particularly on his $30 million mansion under construction in Paritai Drive, Auckland, and revelations he hosted a lavish 50th birthday bash with dozens of mates at a luxury resort in Fiji.

Mr Hotchin said the birthday was planned at least three years ago when "life was a bit different".

The Paritai Drive house, which is owned by a trust and is covered by the court order, was started six years ago - "a very different time".

"It wasn't a vanity project - it grew over time and ended up somewhat larger than we anticipated."

Mr Hotchin admitted that with the benefit of hindsight, a trip he took his family on to Hawaii last year was clearly "a mistake".

"I got a good deal. I did feel I wanted to get away. We had had an enormously stressful period ... "

Hanover and its associate, United Finance, froze $554 million of investors' funds in 2008.

Investors agreed to a moratorium proposal but were later asked to swap their fixed-income securities for new shares in Allied Farmers.

Allied Farmers drastically wrote down the value of the assets. Hanover and Allied have since criticised each other, alleging mismanagement of the assets.

Last night, Mr Hotchin said he had not been living a life of luxury.

"There's been a lot of media attention, there's been a lot of misinformation - this lavish lifestyle, 90 per cent of it has been exaggerated."

Mr Hotchin said he knew investors were "doing it hard".

"Certainly this wasn't what we intended. The plan had been to move from a platform that wasn't working to a better one at Allied. "A lot of people believed Allied and they believed me when I said I thought the Allied deal was good."

Asked what he wanted to say to the investors, he said: "I guess the biggest thing is I'm sorry."

Mr Hotchin said he was a decent citizen and was not afraid to walk the street.