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Commerce Committee To Hold Inquiry Into Finance Company Failures

Fuseworks Media
Fuseworks Media
Lianne Dalziel
Lianne Dalziel

Wellington, Aug 20 NZPA - Parliament's commerce select committee will hold an inquiry into finance company failures, committee chairwoman Lianne Dalziel announced today.

She said that during the past three years, about 30 finance companies had gone into receivership or liquidation, entered into moratoria or frozen repayments to investors.

"These events have raised a number of significant issues with regard to practices in the finance company sector and the legal frameworks that govern the sector," Ms Dalziel said.

"A number of the issues involved have been identified by the current and previous governments -- in some cases legislative changes have been made and new regimes are being implemented, in other cases major policy processes are under way that are likely to result in further legislative change."

Ms Dalziel said the committee was not going to duplicate work that was already under way.

"Rather, it wishes to focus on issues that do not appear to have been identified within current work programmes, and on particular issues which may benefit from the scrutiny a select committee can bring to bear."

ACT MP John Boscawsen, a member of the committee, claimed credit for the inquiry and said he had been calling for it since February.

"I feel it's a personal victory that the committee has finally agreed with me," he said.

"Billions of dollars have been lost, with some investors having been driven to suicide.

"Many other investors have lost their homes, their life savings, and will now struggle to survive in their retirement years."

The issues the committee has identified are:

* Ensuring investors are well-informed about investment proposals;

* ensuring investors understand the implications of a moratorium proposal before voting;

* ensuring advance actions can be taken to reduce the chances of failure; and

* ensuring adequate measures or redress exist when failure occurs.

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