SFO confirms investigation into NZF Group

22 March 2012

SFO confirms investigation into NZF Group

The Serious Fraud Office (SFO) confirmed today that it has commenced a Part II investigation into NZF Group Limited, NZF Money Limited, and their related companies.

NZF Money has traded as a finance company and primarily provided commercial and residential loans. On 22 July 2011, the company was placed into receivership owing debenture holders approximately $16.4 million.

SFO and the Financial Markets Authority (FMA) together have been assessing a range of allegations relating to the conduct of the group. The primary focus of the SFO assessment relates to alleged related party transactions between members of the group, its directors and officers. The transactions cover a period from 2006 to the present.

SFO Chief Executive Adam Feeley said, “We are extremely conscious of the need to respond quickly where material concerns arise. We are satisfied that there are valid grounds for an investigation into the wider group, and that there is a legitimate interest in publicly advising investors of this investigation.”

SFO acknowledged the assistance received from FMA to date.

Mr Feeley said, “The public can take confidence from the fact that both regulators and law enforcement agencies are working closely on these matters, and our investigation will continue to proceed in close co-operation with the FMA’s activities.”

Investors who have information relating to this case that may be of interest to the SFO are encouraged to contact the investigation team in the first instance on 0800 109 800 or complaints@sfo.govt.nz

Role of the SFO

The Serious Fraud Office (SFO) was established in 1990 under the Serious Fraud Office Act in response to the collapse of financial markets in New Zealand at that time.

The SFO operates three investigative teams:
• Fraud Detection & Intelligence;
• Financial Markets & Corporate Fraud; and
• Fraud & Corruption.

The SFO operates under two sets of investigative powers.

Part I of the SFO Act provides that it may act where the Director “has reason to suspect that an investigation into the affairs of any person may disclose serious or complex fraud.”

Part II of the SFO Act provides the SFO with more extensive powers where: “…the Director has reasonable grounds to believe that an offence involving serious or complex fraud may have been committed…”

The SFO’s Statement of Intent 2011-2014 sets out the SFO’s three year strategic goals and performance standards. It is available online at: www.sfo.govt.nz

ENDS

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