How Big Are The Regulators Balls?

September 15, 2024

NZ as we know is commonly known as a ‘wet bus ticket’ operator.

Soft on crime. In fact just soft. Woke. Pathetic.

As the Du Val Group horror show continues we are asking “just how big are the balls on New Zealand’s regulators ?”

The FMA (after god knows how long) decided to swoop on Du Val and its Directors, Kenyon & Charlotte Clarke.

Through the PWC report we’ve learned of a million dollar plus loan out of the Mortgage Fund to a party (multiple sources tell us it’s Charlotte Clarke’s sister) who is not in any way connected to Du Val or the wholesale investor funded Mortgage Fund.

Whilst it appears that the loan plus interest was repaid, and it could be described as a victimless crime, it’s nonetheless a crime, as nowhere does the IM say the funds can be used for anything the Clarke’s deem as ok.

We saw similar behaviour by the late Allan Hubbard with Aorangi Securities. Hubbard was charged with 50 charges by the SFO.

We will leave you with something else to consider – was Du Val and its Directors acting as a Criminal Group?

S98A of the Crimes Act 1961 would suggest so below –

98A Participation in organised criminal group

(1) Every person commits an offence and is liable to imprisonment for a term not exceeding 10 years who participates in an organised criminal group—

(a) knowing that 3 or more people share any 1 or more of the objectives (the particular objective or particular objectives) described in paragraphs (a) to (d) of subsection (2) (whether or not the person himself or herself shares the particular objective or particular objectives); and
(b) either knowing that his or her conduct contributes, or being reckless as to whether his or her conduct may contribute, to the occurrence of any criminal activity; and
(c) either knowing that the criminal activity contributes, or being reckless as to whether the criminal activity may contribute, to achieving the particular objective or particular objectives of the organised criminal group.

(2) For the purposes of this Act, a group is an organised criminal group if it is a group of 3 or more people who have as their objective or one of their objectives—

(a) obtaining material benefits from the commission of offences that are punishable by imprisonment for a term of 4 years or more; or
(b) obtaining material benefits from conduct outside New Zealand that, if it occurred in New Zealand, would constitute the commission of offences that are punishable by imprisonment for a term of 4 years or more; or
(c) the commission of serious violent offences; or
(d) conduct outside New Zealand that, if it occurred in New Zealand, would constitute the commission of serious violent offences.

(3) A group of people is capable of being an organised criminal group for the purposes of this Act whether or not—

(a) some of them are subordinates or employees of others; or

(b) only some of the people involved in it at a particular time are involved in the planning, arrangement, or execution at that time of any particular action, activity, or transaction; or
(c) its membership changes from time to time.

Harsh penalties are needed to deter further criminal offending in NZ.

More to come…