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Bust Australian broker could owe up to 4000 New Zealand investors

The collapse of an Australian finance company has put the investment of possibly thousands of New Zealanders at risk.

Sydney-based administrators were appointed to Halifax Investment Services last week and investors accounts were frozen.

The lead administrator of Halifax Investment Services, Morgan Kelly of Ferrier Hodgson, told RNZ there were about 4,000 investor accounts in this country.

He said he did not know how much New Zealand investors money was affected, but he planned to meet local creditors in Auckland on 7 December.

"I am reluctant to give you any misleading information," Mr Kelly said, adding that a full statement would be released later this week.

Australian creditors were told last week that the company was unlikely to be able to pay them.

Halifax is an Australian company registered to operate in New Zealand through offices in Auckland and Wellington.

It also had a local subsidiary called Halifax New Zealand which made a net profit after tax of $16,726 in the year to March.

The Sydney-based director of Halifax Investment Services, Jeffrey Worboys, ceased his directorship of the New Zealand subsidiary on Sunday evening, Companies Office records showed.

The managing director and major shareholder of Halifax New Zealand, Andrew Gibbs, ignored RNZ's efforts to contact him.

Financial statements show he was paid nearly $400,000 in the 2018 financial year, while a company associated with him received a commission payment of $82,788.

The Financial Markets Authority, which issued the New Zealand business with a licence, said it was working with the company, the administrators and the Australian Securities and Investments Commission.

Administration is the first step of business recovery, where a legal ring fence is put around a company to protect it from being broken up and preserve the rights of all creditors.

Madison Reidy

rnz.co.nz

Finance and business investment concept. Graph and rows with statistic growth of coins on table.
Source: istock.com