Ross investors get $21m settlement offer
The liquidators of Ross Asset Management are going after more than $21 million from 160 investors who withdrew money before the massive ponzi scheme’s collapse.
Meanwhile, nearly $10m has been recovered from 54 investors who settled claims against them before a landmark Supreme Court ruling in May.
Ross Asset Management director David Ross was jailed in 2013 for 10 years and 10 months after fleecing at least 700 investors of $115m.
But many clients had managed to withdraw both their original investments and profits before the scheme collapsed in 2012.
Those profits, however, were fictitious, with customer withdrawals covered by investments from new clients.
When the company collapsed, only a few million dollars in investments were found.
Liquidator PWC was pursuing some clients who were able to withdraw money and had been reaching agreements with some from the end of 2015.
By January this year, 39 former clients had agreed to return a total of $6.8m.
Then in May, PWC’S first test case against Wellington barrister Hamish Mcintosh was resolved by the Supreme Court.
It ordered Mcintosh return $454,000 in fictitious profits he withdrew from Ross, while letting him keep his original $500,000 investment.
Mcintosh had argued he should be allowed to retain the entire amount, while the liquidators had wanted the whole sum repaid to a pool for the benefit of all investors.
The latest liquidators’ report from PWC said 160 investors had been written to following the Supreme Court ruling with an offer to settle claims against them. These claims were worth $21.6m. Investors had until next Friday to decide, or else face possible recovery action.
The total number of investors who settled prior to the Supreme Court decision had also risen, up to 54 for a total of $9.7m.
PWC said it was now working on applying to the court for a distribution model to pay back investors.