Hubbard probe could hit MPs

Allan Hubbard
Allan Hubbard
Southern National MPs should brace for some hard questions if, as expected, the Serious Fraud Office fails in its quest to prove South Canterbury businessman Allan Hubbard committed fraud.

The three MPs most likely to feel the wrath of supporters of Mr Hubbard and his wife, Jean, are Rangitata MP Jo Goodhew, Waitaki MP Jacqui Dean and Clutha-Southland MP Bill English.

Mr English was Acting Prime Minister when Commerce Minister Simon Power announced the Hubbards' company Aorangi Investments and seven charitable trusts had been placed in statutory management.

Mr Hubbard maintained this step would not have been taken had Prime Minister John Key been in the country.

The Otago Daily Times is aware that during a visit to Dunedin, Mr Key asked leading Otago financiers about the future for Mr Hubbard and South Canterbury Finance, the company he founded.

The financiers assured Mr Key neither SCF nor Mr Hubbard would fail financially.

Mrs Goodhew has Timaru, Temuka and Ashburton in her electorate, areas in which Aorangi Investments investors have been hard hit by their funds being frozen for months during the SFO investigation.

Mrs Dean's electorate stretches from Wanaka to Geraldine and surrounds the areas not included in Rangitata.

Many farmers in that electorate will be indebted to Mr Hubbard for providing finance when retail banks retrenched.

Thousands of people have expressed support for the Hubbards on internet sites, a protest march has been held in their support and a charitable trust raised more than $30,000 to help mainly elderly people in need.

Investments in Aorangi have been frozen and the ODT has previously reported elderly people were begging banks for money to pay their electricity and food bills.

Mr Hubbard has been using his $1000-a-week allowance from the statutory managers to help pay their bills.

The New Zealand Herald has reported the Cabinet was bracing for the possibility the SFO would not find evidence of complex fraud.

The Government seized control of Mr and Mrs Hubbard's finances on June 20 after a recommendation from the Securities Commission.

Brokers contacted yesterday said they believed Mr Hubbard might have been let down by his professional advisers, who failed to appraise him of the changing standards required for dealing with investments.

It was generally understood Mr and Mr Hubbard's book-keeping was rudimentary and that they had failed to adopt new technology.

But no-one was suggesting fraud.

There were some questions about whether investment returns were directly linked to rates on the lending side of the ledger and that could take some unravelling.

SFO director Adam Feely would not comment on the outcome of his office's investigations.

"I expect a preliminary report will be with me by next week - and I stress preliminary report. This will state there is no offending or we still need to do more work on this, or there are matters that will be charged.

"I cannot give an indication - but we are well advanced."

It was not a popularity contest, he said.

"We are going to get it right and in getting it right it will almost inevitably not be popular with someone."

QC John Billington QC, of Auckland, had been brought in to advise on the issue.

It was becoming clear what the issues were, Mr Feely said.

 

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