By Kate Chapman of NZPA

Wellington, June 21 NZPA - South Canterbury Finance chief executive Sandy Maier was last night stressing the company's independence from former chairman, multi-millionaire Allan Hubbard, who is under statutory management and being investigated by the Serious Fraud Office (SFO).

Mr Hubbard's company, Aorangi Securities, his wife, Margaret, and seven of their charitable trusts were yesterday placed under statutory management in relation to unsecured and undocumented loans.

The matter was also referred to the SFO for possible breaches of the Crimes Act.

More than 400 investors and about $130 million were involved in Aorangi and the trusts.

Companies are put into statutory management to prevent fraud and reckless company management and to protect investors.

South Canterbury Finance, with which Mr Hubbard, 82, was closely associated, was not part of the statutory management order.

Mr Maier told NZPA Mr Hubbard, a significant shareholder in South Canterbury Finance, was no longer a director or chairman with the company. However, he was recently made president for life.

Mr Maier said he was keen to make sure public confidence in South Canterbury was not affected.

However, he was concerned because of the long and close link between the company and Mr Hubbard.

South Canterbury had not been contacted officially in relation to the statutory management, Mr Maier said.

In late May, rating agency Standard & Poor's lowered South Canterbury's long term credit rating by two notches to B plus.

The company had already been accepted for the Government's extended retail deposit scheme, which goes through to December 31, 2011.

Mr Hubbard was "part of the heart" of South Canterbury, and Mr Maier wished him well.

Treasury's director of financial operations, Brian McCulloch, said South Canterbury's depositors remained covered by the deposit guarantee.

Commerce Minister Simon Power announced the statutory management yesterday and said Mr and Mrs Hubbard were personally placed under statutory management because they were so closely related with the businesses.

The seven charitable trusts included in the statutory management were Te Tua, Otipua, Oxford, Regent, Morgan, Benmore and Wai-iti.

Mr and Mrs Hubbard were involved with Aorangi and the trusts as depositors, managers and borrowers.

"These decisions have been taken to protect investors and the matters are now in the hands of the statutory managers and the Serious Fraud Office," Mr Power said.