Huljich Wealth Management's KiwiSaver fund would have been among the worst performing in the market if not for top-ups by director Peter Huljich, a court has been told.
Huljich, along with Huljich Wealth Management (now known as HWM NZ Holdings) are being sentenced in the Auckland District Court today for alleged breaches of the Securities Act.
Huljich faced one charge under section 59 of the Securities Act, and his company two charges - one under section 59 and another under section 58.
Huljich and the company pleaded guilty in September.
The case was brought by the new Financial Markets Authority (FMA), which replaced the Securities Commission.
The charges relate to claims investors were misled by misrepresentations of the performance of the company's KiwiSaver scheme in offer documents.
FMA lawyer Christine Gordon said that without the top-ups the performances of the funds would have materially worse.
She said that in the years after the top-ups were paid, Huljich Wealth performed towards the bottom or at the bottom in terms of the funds in the KiwiSaver market."
She said Huljich's actions had undermined the public's confidence in Kiwisaver and in investing generally.
If Huljich did not know that the company's investment statements were misleading that he should have given his position as a director, she said.
Huljich Wealth advertised itself as a market leader in terms of KiwiSaver performance and investment returns and it grew to be the largest privately owned KiwiSaver fund.
During its operation 74,000 people entered the scheme.
- By Hamish Fletcher of the New Zealand Herald
