SFO reviews Aorangi transactions after Hubbard submission

Photo / Sarah Ivey

The Serious Fraud Office is going back through some of the Aorangi Securities transactions and won't have a clear view on whether to proceed with a prosecution for another three or four weeks.

The white-collar crime investigator started reviewing its probe after receiving a submission from Timaru businessman Allan Hubbard's lawyers last month, which identified a small number of areas that need further investigation before a final decision on pursuing a case can be made.

That will take several weeks of analysis, according to Simon McArley, SFO general manager of financial markets and corporate fraud. "We realised we had some stuff we didn't know,"

McArley told BusinessDesk. "There's a little bit more work to do - three or four weeks more."

The SFO put off making a decision last year having completed the substantive part of its investigation in late November when Hubbard's lawyers requested time to put together a response.

Aorangi's statutory managers put off releasing their sixth report into the investment vehicle after last week's earthquake in Christchurch meant documents were still within the cordoned off area.

The November report said the process of sorting out the firm's affairs continued to be hampered by a lack of information, including missing or non-existent loan documents and limited or no recent financial information from borrowers.

Aorangi had mortgage loans amounting to $59 million, as well as 15 direct and a $24 million loan to Te Tua Charitable Trust.

The report said only one in five borrowers was paying interest on their loans to Aorangi Securities.

Separately, the SFO is looking at several transactions involving Hubbard's failed lender, South Canterbury Finance. The firm was the biggest collapse in the finance sector, and prompted a $1.6 billion call on the government's retail deposit guarantee in August last year.