FMA expects to reach settlement with Prince and Partners Trustee Co shortly

Monday 21st August 2017

The Financial Markets Authority expects to shortly reach a settlement with Prince and Partners Trustee Co just as civil proceedings kick off in the Auckland High Court.

"The parties have been in settlement discussions and the matter is likely to settle. Any settlement agreement is subject to the court’s approval," an FMA spokesman said in emailed comments.

Prince and Partners Trustee Co was the trustee for finance company Viaduct Capital, which collapsed in 2009 owing 110 investors some $7.8 million.

The civil proceedings against Prince and Partners Trustee Co were brought by the FMA under section 34 of the Financial Markets Authority Act in 2014, when it opted to exercise the rights of action of investors not covered by the retail deposit Crown guarantee and the New Zealand Treasury.

The markets regulator alleges Prince and Partners Trustee Co breached its obligations to Viaduct investors and to the Treasury under the guarantee. The claim alleges Viaduct's conduct "resulted in loss to individual investors and to the Treasury under the Crown guarantee, to which Viaduct was a party."

The FMA spokesman declined to give any detail on the amount involved or any other conditions, such as Prince and Partners admitting liability. "We will comment more fully when this process is complete," he said.

(BusinessDesk)

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